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● Certain of our officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in allocating their time and determining to which entity a particular business opportunity should be presented.
+Added: ● If the trading price of our Class A common stock decreases, the amount of cash the Combined Company receives through the Forward Purchase Agreement mechanisms will decrease.
+Added: ● If Meteora purchases any shares pursuant to the Forward Purchase Agreement, the Combined Company will have cash payment obligations that could, as a result, significantly reduce the Combined Company’s cash reserves.
+Added: ● Other events may result in Meteora having no payment obligations to the Combined Company at settlement under the Forward Purchase Agreement.
+Added: ● Shares sold under the Forward Purchase Agreement will not count towards the Combined Company’s Public Float.
+Added: ● The Combined Company may be required to make a future cash payment or issue additional shares of Class A Common Stock to Meteora pursuant to the Forward Purchase Agreement at the Maturity Date, which would reduce the amount of cash available to the Combined Company to fund its operations or dilute the percentage ownership held by the existing stockholders.
Risks Relating to our Search for, Consummation or, or Inability to Consummate, a Business Combination and Post Business Combination Risks
−Removed: Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the recent coronavirus (COVID-19) pandemic.
−Removed: The COVID-19 pandemic has resulted in a widespread health crisis that has adversely affected the economies and financial markets worldwide, and the business of any potential target business with which we consummate a business combination could be materially and adversely affected.
−Removed: Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit the ability to have meetings with potential investors or the target company’s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner.
−Removed: The extent to which COVID-19 impacts our search for a business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others.
−Removed: If the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time, our ability to consummate a business combination, or the operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected.
Our public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination.
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The Anchor Investors have agreed to vote any Founder Shares held by them in favor of our initial business combination.
−Removed: As a result, in addition to our initial stockholders’ Founder Shares we would need only 34,501 or 0.36%, of the 9,338,000 public shares and Representative Shares sold in the offering to be voted in favor of an initial business combination (assuming only the minimum number of shares representing a quorum are voted) or 2,369,001 or 25.36% (assuming all issued and outstanding shares are
−Removed: voted) in order to have our initial business combination approved.
+Added: As a result, in addition to our initial stockholders’ Founder Shares we would need only 119,032 or 1.23%, of the 9,676,125 public shares and Representative Shares sold in the offering to be voted in favor of an initial business combination (assuming only the minimum number of shares representing a quorum are voted) or 2,538,063 or 26.23% (assuming all issued and outstanding shares are voted) in order to have our initial business combination approved.
In the event that our Anchor Investors vote their public shares in favor of our initial business combination, no affirmative votes from other public stockholders would be required to approve our initial business combination.
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As a result of the Founder Shares that the Anchor Investors may hold, each Anchor Investor may have different interests with respect to a vote on an initial business combination than other public stockholders.
−Removed: Among other matters, the Anchor Investors’ investments in the Founder Shares will generally be worthless if we do not consummate an initial business combination within 12 months, or if we decide to extend the period of time to consummate our business combination up to two times by an additional three months each time, at $0.10 per extension, for a total of $0.20 aggregate in trust, within 18 months, from the closing of the IPO, as described in more detail in this prospectus, and these investors will benefit more than our public stockholders from our completion of an initial business combination and may benefit from an initial business combination even if our public stockholders experience a loss.
+Added: Among other matters, the Anchor Investors’ investments in the Founder Shares will generally be worthless if we do not consummate an initial business combination within 24 months from the closing of the IPO, as described in more detail in this prospectus, and these investors will benefit more than our public stockholders from our completion of an initial business combination and may benefit from an initial business combination even if our public stockholders experience a loss.
Accordingly, these investors may be more likely to favor any proposed initial business combination transaction even if our public stockholders do not favor the transaction.
The Anchor Investors will also have the potential to realize enhanced economic returns and overall economic outcome from their investment in us in comparison to our other public stockholders who are not making anchor investments and purchasing Founder Shares.
−Removed: Our initial stockholders will own shares representing approximately 14.6% of our outstanding shares of common stock immediately following the completion of the IPO and the private placement (including the representative shares and assuming the initial stockholders and Anchor Investors do not purchase any units in the IPO).
+Added: Our initial stockholders currently own 17.5% of our outstanding shares of common stock.
Accordingly, if we seek stockholder approval of our initial business combination, the agreement by our initial stockholders to vote in favor of our initial business combination, and the agreement by the Anchor Investors to vote any Founder Shares held by them in favor of our initial business combination will increase the likelihood that we will receive the requisite stockholder approval for such initial business combination.
Since our Anchor Investors own Founder Shares, a conflict of interest may arise in determining whether a particular target business is appropriate for our initial business combination.
−Removed: The Anchor Investors own Founder Shares.
+Added: The Anchor Investors own Founder Shares and have agreed to vote such shares owned by them in favor of any proposed initial business combination.
The Anchor Investors will benefit from any appreciation in the value of the Founder Shares above that nominal amount, provided that we successfully complete a business combination.
−Removed: As a result of their interest in the Founder Shares, the Anchor Investors may have an incentive to vote any public shares they own in favor of a business combination, and, if a business combination is approved, they may make a substantial profit on such interests, even if the business combination is with a target that ultimately declines in value and is not profitable for other public stockholders.
−Removed: Unlike other blank check companies, we may extend the time to complete a business combination by up to two times by an additional three months each time, at $0.10 per extension, for a total of $0.20 aggregate in trust, for a maximum total of 18 months, without a stockholder vote or your ability to redeem your shares.
−Removed: We have until May 13, 2023 to consummate an initial business combination.
−Removed: However, if we anticipate that we may not be able to consummate our initial business combination by that time, we may extend the period of time to consummate an initial business combination, up to two times, by an additional three months each time, at $0.10 per share outstanding after the redemptions per extension, for a total of $0.20 per share outstanding after the redemptions aggregate in trust, for a maximum total of 18 months, without submitting such proposed extension to our stockholders for approval or offering our public stockholders redemption rights in connection therewith.
−Removed: Pursuant to the terms of the amended and restated certificate of incorporation and our registration statement/prospectus in connection with the Initial Public Offering, if we decide to exercise the Extension Option and do not complete the initial business combination within the prescribed time frame, (i) we shall redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein;
−Removed: and (ii) investors will have no voting rights and no redemption rights in connection with the additional three-month extensions.
+Added: As a result of their interest in the Founder Shares, if a business combination is approved, they may make a substantial profit on such interests, even if the business combination is with a target that ultimately declines in value and is not profitable for other public stockholders.
+Added: Unlike other blank check companies, we have until May 13, 2024 to complete a business combination, without a stockholder vote or your ability to redeem your shares.
+Added: We have until May 13, 2024 to consummate an initial business combination pursuant to the Current Extension.
+Added: Pursuant to the terms of the amended and restated certificate of incorporation and our registration statement/prospectus in connection with the Initial Public Offering, if we do not complete the initial business combination within the prescribed time frame, (i) we shall redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein;
+Added: and (ii) investors will have no voting rights and no redemption rights.
Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of the initial business combination.
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If too many public stockholders exercise their redemption rights, we would not be able to meet such closing condition and, as a result, would not be able to proceed with the initial business combination.
−Removed: Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 both immediately prior to and upon consummation of our initial business combination and after payment of underwriters’ fees and commissions (so that we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination.
−Removed: Consequently, if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 both immediately prior to and upon consummation of our initial business combination and after payment of underwriters’ fees and commissions or such greater amount necessary to satisfy a closing condition as described above, we would not proceed with such redemption and the related business combination and may instead search for an alternate business combination.
Prospective targets will be aware of these risks and, thus, may be reluctant to enter into an initial business combination with us.
The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure.
−Removed: At the time we enter into an agreement for our initial business combination, we will not know how many stockholders may exercise their redemption rights, and therefore will need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption.
−Removed: If our initial business combination agreement requires us to use a portion of the cash in the Trust Account to pay the purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the Trust Account to meet such requirements, or arrange for third-party financing.
+Added: At the time we entered into the Merger Agreement or if we enter into another agreement for our initial business combination, we did not and will not know how many stockholders may exercise their redemption rights, and therefore have or may need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption.
In addition, if a larger number of shares are submitted for redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the Trust Account or arrange for third-party financing.
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The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating an initial business combination and may decrease our ability to conduct due diligence on potential business combination targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders.
−Removed: Any potential target business with which we enter into negotiations concerning an initial business combination will be aware that we must complete our initial business combination by May 13, 2023 (or November 13, 2023 if we use our options to extend the period of time to consummate a business combination) from the closing of our Initial Public Offering.
+Added: Any potential target business with which we enter into negotiations concerning an initial business combination will be aware that we must complete our initial business combination by May 13, 2024.
Consequently, such target business may obtain leverage over us in negotiating an initial business combination, knowing that if we do not complete our initial business combination with that particular target business, we may be unable to complete our initial business combination with any target business.
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We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may only receive $10.10 per share, or less than such amount in certain circumstances, and our Warrants and Public Rights will expire worthless.
−Removed: Our amended and restated certificate of incorporation provides that we must complete our initial business combination by May 13, 2023 (or November 13, 2023 if we use our options to extend the period of time to consummate a business combination) from the closing of our Initial Public Offering.
+Added: Our amended and restated certificate of incorporation provides that we must complete our initial business combination by May 13, 2024.
Our ability to complete our initial business combination may be negatively impacted by general market conditions, volatility in the capital and debt markets and the other risks described herein.
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In the event that our Sponsor, directors, officers or their affiliates purchase shares in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights or submitted a proxy to vote against our initial business combination, such selling stockholders would be required to revoke their prior elections to redeem their shares and any proxy to vote against our initial business combination.
−Removed: The price per share paid in any such transaction may be different than the amount per share of a public stockholder would receive if it elected to redeem its share in connection with our initial business combination.
+Added: price per share paid in any such transaction may be different than the amount per share of a public stockholder would receive if it elected to redeem its share in connection with our initial business combination.
The purpose of such purchases could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination, or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met.
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Our public stockholders will be entitled to receive funds from the Trust Account only upon the earliest to occur of:
−Removed: (i) our completion of an initial business combination, and then only in connection with those shares of Class A Common Stock that such stockholder properly elected to redeem, subject to the limitations described herein, (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination by May 13, 2023 (or
−Removed: November 13, 2023 if we use our options to extend the period of time to consummate a business combination) from the closing of our Initial Public Offering or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity and (iii) the redemption of our public shares if we are unable to complete an initial business combination by May 13, 2023 (or November 13, 2023 if we use our options to extend the period of time to consummate a business combination) from the closing of our Initial Public Offering, subject to applicable law and as further described herein.
+Added: (i) our completion of an initial business combination, and then only in connection with those shares of Class A Common Stock that such stockholder properly elected to redeem, subject to the limitations described herein, (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination by May 13, 2024, or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity and (iii) the redemption of our public shares if we are unable to complete an initial business combination by May 13, 2024, subject to applicable law and as further described herein.
In no other circumstances will a public stockholder have any right or interest of any kind in the Trust Account.
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Since the net proceeds of our Initial Public Offering and the sale of the Private Placement Warrants are intended to be used to complete an initial business combination with a target business, we may be deemed to be a “blank check” company under the United States securities laws.
−Removed: However, because we will have net tangible assets in excess of $5,000,000 upon the successful completion of our Initial Public Offering and the sale of the Private Placement Warrants and will file a Current Report on Form 8-K, including an audited balance sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419.
+Added: However, because we filed a Current Report on Form 8-K, including an audited balance sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419.
Accordingly, investors will not be afforded the benefits or protections of those rules.
−Removed: Among other things, this means our Units will be immediately tradable and we will have a longer period of time to complete our initial business combination than do companies subject to Rule 419.
+Added: Among other things, this means our Units were immediately tradable and we will have a longer period of time to complete our initial business combination than do companies subject to Rule 419.
Moreover, if our Initial Public Offering were subject to Rule 419, that rule would prohibit the release of any interest earned on funds held in the Trust Account to us unless and until the funds in the Trust Account were released to us in connection with our completion of an initial business combination.
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This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses.
−Removed: Furthermore, because we are obligated to pay cash for the shares of Class A Common Stock which our public stockholders redeem in connection with our initial business combination, target companies
−Removed: will be aware that this may reduce the resources available to us for our initial business combination.
+Added: Furthermore, because we are obligated to pay cash for the shares of Class A Common Stock which our public stockholders redeem in connection with our initial business combination, target companies will be aware that this may reduce the resources available to us for our initial business combination.
This may place us at a competitive disadvantage in successfully negotiating an initial business combination.
If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.10 per share on the liquidation of our Trust Account, or less in certain circumstances, and our Warrants and Public Rights will expire worthless.
−Removed: If the net proceeds of our Initial Public Offering and the sale of the Private Placement Warrants not being held in the Trust Account are insufficient to allow us to operate for at least the next 12 months (or up to 18 months if we use our options to extend the period of time to consummate a business combination), we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10 .
−Removed: 10 per share, or less than such amount in certain circumstances, and our Warrants and Public Rights will expire worthless .
−Removed: The funds available to us outside of the Trust Account may not be sufficient to allow us to operate for at least the next 12 months (or up to 18 months if we use our options to extend the period of time to consummate an initial business combination), assuming that our initial business combination is not completed during that time.
−Removed: We believe that the funds available to us outside of the Trust Account will be sufficient to allow us to operate for at least the 12 months following our Initial Public Offering (or up to 18 months if we use our options to extend the period of time to consummate a business combination);
+Added: If the net proceeds of our Initial Public Offering and the sale of the Private Placement Warrants not being held in the Trust Account are insufficient to allow us to operate for at least 24 months from the date of the IPO, we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.10 per share, or less than such amount in certain circumstances, and our Warrants and Public Rights will expire worthless.
+Added: The funds available to us outside of the Trust Account may not be sufficient to allow us to operate for at least 24 months from the date of the IPO, assuming that our initial business combination is not completed during that time.
+Added: We believe that the funds available to us outside of the Trust Account will be sufficient to allow us to operate for at least the 24 months following our Initial Public Offering;
however, we cannot assure you that our estimate is accurate.
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If we are unable to obtain these loans, we may be unable to complete our initial business combination .
−Removed: Of the net proceeds of our Initial Public Offering and the sale of the Private Placement Warrants, only $525,000 was available to us initially outside the Trust Account to fund our working capital requirements.
−Removed: If we are required to seek additional capital, we would need to borrow funds from our Sponsor, management team or other third parties to operate or may be forced to liquidate.
+Added: Of the net proceeds of our Initial Public Offering and the sale of the Private Placement Warrants, only $525,000 was available to us initially outside the Trust Account to fund our working capital requirements and we had $5,947 available to us outside the Trust Account to fund our working capital requirements as of December 31, 2023.
+Added: We have borrowed funds from our Sponsor and may need to continue to borrow funds from our Sponsor, management team or other third parties to operate or may be forced to liquidate.
None of our Sponsor, members of our management team nor any of their affiliates is under any obligation to advance funds to us in such circumstances.
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During the year ended December 31, 2023, the Sponsor loaned the Company $582,457 in Working Capital Loans.
+Added: As of December 31, 2023, we had $739,457 in Working Capital Loans outstanding.
The Working Capital Loans are to be repaid upon consummation of a Business Combination, without interest, or, at the lender’s option, up to $1.5 million of the outstanding Working Capital Loans are convertible into Private Warrants at a price of $1.00 per warrant.
−Removed: Prior to the completion of our initial business combination, we do not expect to seek loans from parties other than our Sponsor or an affiliate of our Sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our Trust Account.
+Added: Prior to the completion of our initial business combination, we do not expect to seek loans from parties other than our Sponsor, ConnectM or an affiliate of our Sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our Trust Account.
If we are unable to obtain these loans, we may be unable to complete our initial business combination.
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If any third party refuses to execute an agreement waiving such claims to the monies held in the Trust Account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party’s engagement would be significantly more beneficial to us than any alternative.
−Removed: Marcum LLP, our independent registered accounting firm, and the underwriters of the Initial Public Offering, would not execute agreements with us waiving such claims to the monies held in the Trust Account.
+Added: Adeptus Partners, LLP, our independent registered accounting firm, and the underwriters of the Initial Public Offering, would not execute agreements with us waiving such claims to the monies held in the Trust Account.
Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver.
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Pursuant to the letter agreement, our Sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $10.10 per public share and (ii) the actual amount per public share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.10 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the Trust Account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of our Initial Public Offering against certain liabilities, including liabilities under the Securities Act.
−Removed: However, we have not asked our Sponsor to reserve for such indemnification obligations, nor have we independently
−Removed: verified whether our Sponsor has sufficient funds to satisfy its indemnity obligations and believe that our Sponsor’s only assets are securities of our company.
+Added: However, we have not asked our Sponsor to reserve for such indemnification obligations, nor have we independently verified whether our Sponsor has sufficient funds to satisfy its indemnity obligations and believe that our Sponsor’s only assets are securities of our company.
Therefore, we cannot assure you that our Sponsor would be able to satisfy those obligations.
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(i) the completion of our initial business combination;
−Removed: (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months if we use our options to extend the period of time to consummate an initial business combination) from the closing of our Initial Public Offering or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity;
−Removed: or (iii) absent an initial business combination within 12 months (or up to 18 months if we use our options to extend the period of time to consummate an initial business combination) from the closing of our Initial Public Offering, our return of the funds held in the Trust Account to our public stockholders as part of our redemption of the public shares.
+Added: (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of our Initial Public Offering or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity;
+Added: or (iii) absent an initial business combination within 24 months from the closing of our Initial Public Offering, our return of the funds held in the Trust Account to our public stockholders as part of our redemption of the public shares.
If we do not invest the proceeds as discussed above, we may be deemed to be subject to the Investment Company Act.
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Under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution.
−Removed: The pro rata portion of our Trust Account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 12 months (or up to 18 months if we use our options to extend the period of time to consummate an initial business combination) from the closing of our Initial Public Offering may be considered a liquidating distribution under Delaware law.
+Added: The pro rata portion of our Trust Account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 24 months from the closing of our Initial Public Offering may be considered a liquidating distribution under Delaware law.
If a corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution.
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As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend beyond the third anniversary of such date.
−Removed: Furthermore, if the pro rata portion of our Trust Account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 12 months (or up to 18 months if we use our options to extend the period of time to consummate an initial business combination) from the closing of our Initial Public Offering is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.
+Added: Furthermore, if the pro rata portion of our Trust Account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 24 months from the closing of our Initial Public Offering is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.
We may not hold an annual meeting of stockholders until after the consummation of our initial business combination, which could delay the opportunity for our stockholders to elect directors.
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The grant of registration rights to our initial stockholders may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of our Class A Common Stock.
−Removed: Our initial stockholders and their permitted transferees can demand that we register the Private Placement Warrants, the Private Placement Warrants, the shares of Class A Common Stock issuable upon exercise of the Private Placement Warrants and upon conversion of the Founder Shares held, or to be held, by them and holders of securities that may be issued upon conversion of Working Capital Loans may demand that we register such warrants or the Class A Common Stock issuable upon conversion or exercise of such
+Added: Our initial stockholders and their permitted transferees can demand that we register the Private Placement Warrants, the Private Placement Warrants, the shares of Class A Common Stock issuable upon exercise of the Private Placement Warrants and upon conversion of the Founder Shares held, or to be held, by them and holders of securities that may be issued upon conversion of Working Capital Loans may demand that we register such warrants or the Class A Common Stock issuable upon conversion or exercise of such warrants.
We will bear the cost of registering these securities.
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In addition, if we announce a prospective business combination with a target that does not meet our general criteria and guidelines, a greater number of stockholders may exercise their redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain amount of cash.
−Removed: In addition, if stockholder approval of the transaction is required by
−Removed: applicable law or stock exchange requirements, or we decide to obtain stockholder approval for business or other legal reasons, it may be more difficult for us to attain stockholder approval of our initial business combination if the target business does not meet our general criteria and guidelines.
+Added: In addition, if stockholder approval of the transaction is required by applicable law or stock exchange requirements, or we decide to obtain stockholder approval for business or other legal reasons, it may be more difficult for us to attain stockholder approval of our initial business combination if the target business does not meet our general criteria and guidelines.
If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.10 per share on the liquidation of our trust account, or less in certain circumstances, and our Warrants and Public Rights will expire worthless.
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Should the target business’s management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and profitability of the post-combination business may be negatively impacted.
−Removed: Accordingly, any
−Removed: stockholders who choose to retain their securities following the business combination could suffer a reduction in the value of their securities.
+Added: Accordingly, any stockholders who choose to retain their securities following the business combination could suffer a reduction in the value of their securities.
Such stockholders are unlikely to have a remedy for such reduction in value.
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This lack of diversification may negatively impact our operating results and profitability.
−Removed: As of December 31, 2022, we had funds available for an initial business combination in the amount of $90,088,638 assuming no redemptions and after future payment of $3,680,000 of deferred underwriting fees, and $441,166 in franchise and income taxes, and before fees and expenses associated with our initial business combination.
+Added: As of December 31, 2023, we had funds available for an initial business combination in the amount of $75,053,357 assuming no redemptions and after future payment of $3,680,000 of deferred underwriting fees, and before fees and expenses associated with our initial business combination.
We may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within a short period of time.
However, we may not be able to effectuate our initial business combination with more than one target business because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that present operating results and the financial condition of several target businesses as if they had been operated on a combined basis.
−Removed: By completing
−Removed: our initial business combination with only a single entity, our lack of diversification may subject us to numerous economic, competitive and regulatory developments.
+Added: By completing our initial business combination with only a single entity, our lack of diversification may subject us to numerous economic, competitive and regulatory developments.
Further, we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete several business combinations in different industries or different areas of a single industry.
24 unchanged sentences
The absence of such a redemption threshold may make it possible for us to complete an initial business combination with which a substantial majority of our stockholders do not agree.
−Removed: Our amended and restated certificate of incorporation does not provide a specified maximum redemption threshold, except that in no event will we redeem our public shares unless our net tangible assets to be less than $5,000,001 both immediately prior to and upon consummation of our initial business combination and after payment of underwriters’ fees and commissions (such that we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination.
+Added: Our amended and restated certificate of incorporation does not provide a specified maximum redemption threshold.
As a result, we may be able to complete our initial business combination even though a substantial majority of our public stockholders do not agree with the transaction and have redeemed their shares or, if we seek stockholder approval of our initial business combination and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our Sponsor, officers, directors or their affiliates.
5 unchanged sentences
Amending our amended and restated certificate of incorporation requires the approval of holders of 65% of our common stock, amending our Rights Agreement will require a vote of holders of at least a majority of the then outstanding Public Rights, and amending our Warrant Agreement will require a vote of holders of at least 65% of the Public Warrants.
−Removed: In addition, our amended and restated certificate of incorporation requires us to provide our public stockholders with the opportunity to redeem their public shares for cash if we propose an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or certain amendments to our prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months if we use our options to extend the period of time to consummate an initial business combination) from the closing of our Initial Public Offering or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity.
+Added: In addition, our amended and restated certificate of incorporation requires us to provide our public stockholders with the opportunity to redeem their public shares for cash if we propose an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or certain amendments to our prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of our Initial Public Offering or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity.
To the extent any such amendments would be deemed to fundamentally change the nature of any securities offered through this registration statement, we would register, or seek an exemption from registration for, the affected securities.
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It may be easier for us, therefore, to amend our amended and restated certificate of incorporation and the trust agreement to facilitate the completion of an initial business combination that some of our stockholders may not support .
−Removed: Our amended and restated certificate of incorporation provides that any of its provisions related to pre-initial business combination activity (including the requirement to deposit proceeds of our Initial Public Offering and the Private Placement of warrants into the Trust Account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein and including to permit us to withdraw funds from the Trust Account such that the per share amount investors will
−Removed: receive upon any redemption or liquidation is substantially reduced or eliminated) may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our Trust Account may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon.
+Added: Our amended and restated certificate of incorporation provides that any of its provisions related to pre-initial business combination activity (including the requirement to deposit proceeds of our Initial Public Offering and the Private Placement of warrants into the Trust Account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein and including to permit us to withdraw funds from the Trust Account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated) may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our Trust Account may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon.
In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the DGCL or applicable stock exchange rules.
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Our stockholders may pursue remedies against us for any breach of our amended and restated certificate of incorporation.
−Removed: Our Sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination by May 13, 2023 (or November 13, 2023 if we use our options to extend the period of time to consummate a business combination) from the closing of our Initial Public Offering or (ii) with respect to any other provision relating to the stockholders’ rights or pre-initial business combination activity of our Class A Common Stock, unless we provide our public stockholders with the opportunity to redeem their shares of Class A Common Stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, divided by the number of then outstanding public shares.
+Added: Our Sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination by May 13, 2024, or (ii) with respect to any other provision relating to the stockholders’ rights or pre-initial business combination activity of our Class A Common Stock, unless we provide our public stockholders with the opportunity to redeem their shares of Class A Common Stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, divided by the number of then outstanding public shares.
These agreements are contained in a letter agreement that we have entered into with our Sponsor, officers and directors.
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To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate.
−Removed: Further, the amount of additional financing we may be required to obtain could increase as a result of future growth capital needs for any particular transaction, the depletion of the available net proceeds in search of a target business, the obligation to repurchase for cash a significant number of shares from stockholders who elect redemption
−Removed: in connection with our initial business combination and/or the terms of negotiated transactions to purchase shares in connection with our initial business combination.
+Added: Further, the amount of additional financing we may be required to obtain could increase as a result of future growth capital needs for any particular transaction, the depletion of the available net proceeds in search of a target business, the obligation to repurchase for cash a significant number of shares from stockholders who elect redemption in connection with our initial business combination and/or the terms of negotiated transactions to purchase shares in connection with our initial business combination.
If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.10 per share plus any pro rata interest earned on the funds held in the Trust Account and not previously released to us to pay our taxes on the liquidation of our Trust Account and our Public Warrants and Public Rights will expire worthless.
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Compliance obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial financial and management resources, and increase the time and costs of completing an initial business combination.
−Removed: Section 404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with this Annual Report on Form 10-K for the year ending December 31, 2022.
+Added: Section 404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls.
Only in the event we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting.
Further, for as long as we remain an emerging growth company, we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting.
−Removed: The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a target company with which we seek to complete our initial business combination may not be in compliance with the provisions of the Sarbanes-Oxley
−Removed: Act regarding adequacy of its internal controls.
+Added: The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a target company with which we seek to complete our initial business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls.
The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such business combination.
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Such officers and directors may not be familiar with United States securities laws.
−Removed: If our new management following our initial business combination is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar with such
+Added: If our new management following our initial business combination is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar with such laws.
This could be expensive and time-consuming and could lead to various regulatory issues which may adversely affect our operations.
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The role of our key personnel in the target business, however, cannot presently be ascertained.
−Removed: Although some of our key personnel may remain with
−Removed: the target business in senior management or advisory positions following our initial business combination, it is likely that some or all of the management of the target business will remain in place.
+Added: Although some of our key personnel may remain with the target business in senior management or advisory positions following our initial business combination, it is likely that some or all of the management of the target business will remain in place.
While we intend to closely scrutinize any individuals we employ after our initial business combination, we cannot assure you that our assessment of these individuals will prove to be correct.
28 unchanged sentences
Until we consummate our initial business combination, we intend to engage in the business of identifying and combining with one or more businesses.
−Removed: Our Sponsor, officers and directors are, and may in the future become, affiliated with entities (such as operating companies or investment vehicles) that are engaged in a similar business, although they may not participate in the formation of, or become an officer or director of, any other special purpose acquisition companies with a class of securities registered under the Exchange Act until we have entered into a definitive agreement regarding our initial business combination or we have failed to complete our initial business combination by May 13, 2023 (or November 13, 2023 if we use our options to extend the period of time to consummate a business combination).
+Added: Our Sponsor, officers and directors are, and may in the future become, affiliated with entities (such as operating companies or investment vehicles) that are engaged in a similar business, although they may not participate in the formation of, or become an officer or director of, any other special purpose acquisition companies with a class of securities registered under the Exchange Act until we have entered into a definitive agreement regarding our initial business combination or we have failed to complete our initial business combination by May 13, 2024.
Our officers and directors also may become aware of business opportunities which may be appropriate for presentation to us and the other entities to which they owe certain fiduciary or contractual duties.
7 unchanged sentences
Accordingly, such persons or entities may have a conflict between their interests and ours.
−Removed: The representative may have a conflict of interest if they render services to us in connection with our initial business combination.
−Removed: We may elect to engage EF Hutton, division of Benchmark Investments, LLC (who was the representative of the underwriters of the IPO) to assist us in connection with our initial business combination, although we have not with respect to the proposed initial business combination with ConnectM.
+Added: The representative has a conflict of interest because they render services to us in connection with our initial business combination.
+Added: We have engaged EF Hutton, division of Benchmark Investments, LLC (who was the representative of the underwriters of the IPO) to assist us in connection with our initial business combination with ConnectM.
The representative shares held by the representative and/or its designees will also be worthless if we do not consummate an initial business combination.
−Removed: Therefore, if the representative provides services to us in connection with our initial business combination, these financial interests may result in the representative having a conflict of interest when providing such services to us.
+Added: These financial interests create a conflict of interest when providing such services to us.
We may engage in an initial business combination with one or more target businesses that have relationships with entities that may be affiliated with our Sponsor, officers, directors or existing holders which may raise potential conflicts of interest.
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These securities will also be worthless if we do not complete an initial business combination.
−Removed: Holders of Founder Shares have agreed (A) to vote any shares owned by them in favor of any proposed initial business combination, (B) not to redeem any Founder Shares held by them in connection with a stockholder vote to approve a proposed initial business combination and (C) the Anchor Investors will not be entitled to (i) redemption rights with respect to any Founder Shares held by them in connection with the completion of our business combination, (ii) redemption rights with respect to any Founder Shares held by them in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation that would affect the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination by May 13, 2023 (or November 13, 2023 if we use our options to extend the period of time to consummate a business combination), or (iii) rights to liquidating distributions from the trust account with respect to any Founder Shares held by them if we fail to complete our business combination by May 13, 2023 (or November 13, 2023 if we use our options to extend the period of time to consummate a business combination), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our business combination within such time period.
+Added: Holders of Founder Shares have agreed (A) to vote any shares owned by them in favor of any proposed initial business combination, (B) not to redeem any Founder Shares held by them in connection with a stockholder vote to approve a proposed initial business combination and (C) the Anchor Investors will not be entitled to (i) redemption rights with respect to any Founder Shares held by them in connection with the completion of our business combination, (ii) redemption rights with respect to any Founder Shares held by them in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation that would affect the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination by May 13, 2024, or (iii) rights to liquidating distributions from the trust account with respect to any Founder Shares held by them if we fail to complete our business combination by May 13, 2024, although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our business combination within such time period.
In addition, we may obtain loans from our Sponsor, affiliates of our Sponsor or an officer or director.
6 unchanged sentences
These financial interests of our sponsor, executive officers and directors may influence their motivation in identifying and selecting a target business combination and completing an initial business combination.
+Added: Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the recent coronavirus (COVID-19) pandemic.
+Added: The COVID-19 pandemic has resulted in a widespread health crisis that has adversely affected the economies and financial markets worldwide, and the business of any potential target business with which we consummate a business combination could be materially and adversely affected.
+Added: Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit the ability to have meetings with potential investors or the target company’s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner.
+Added: The extent to which COVID-19 impacts our search for a business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others.
+Added: If the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time, our ability to consummate a business combination, or the operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected.
+Added: If the trading price of the Class A Common Stock decreases, the amount of cash the Combined Company receives through the Forward Purchase Agreement mechanisms will decrease.
+Added: Generally, under the Forward Purchase Agreement, Meteora may purchase Recycled Shares and within one business day following the Closing of the Business Combination, the Combined Company will prepay the Prepayment Amount.
+Added: At the written request of Meteora, the Prepayment Amount must be deposited into an escrow account simultaneously with the Closing.
+Added: From time to time, Meteora may sell the Recycled Shares and the Combined Company will recoup the proceeds at 95% of the Reset Price (as defined therein) less the Prepayment Shortfall.
+Added: While the Combined Company may receive cash proceeds out of the escrow account from sales of Recycled Shares by Meteora, Meteora may not have any incentive to sell such Recycled Shares unless the trading price of the Class A Common Stock is above the Reset Price.
+Added: There is no guarantee that the trading price of the Class A Common Stock will equal or exceed the Reset Price at any given time.
+Added: In such a case, Meteora may not sell the Recycled Shares, in which case the Combined Company may not receive cash settlement proceeds from the Forward Purchase Agreement and Meteora may retain ownership of all of the Recycled Shares it purchased pursuant to the Forward Purchase Agreement.
+Added: In addition, if Meteora decides to sell the Recycled Shares into the market, it may cause the trading price of our Class A Common Stock to decline significantly.
+Added: If Meteora purchases any shares pursuant to the Forward Purchase Agreement, the Combined Company will have cash payment obligations that could, as a result, significantly reduce the Combined Company’s cash reserves.
+Added: If Meteora purchases any Recycled Shares pursuant to the Forward Purchase Agreement, within one business day following the Closing of the Business Combination, the Combined Company will be required to prepay the Prepayment Amount (into the escrow account) and pay the Share Consideration and the Cash Consideration to Meteora, and, as a result, the Combined Company’s cash reserves following Closing could be reduced significantly.
+Added: In addition, pursuant to the Forward Purchase Agreement, at the Maturity Date, the Combined Company is required to purchase from Meteora all of the unsold Recycled Shares for consideration equal to the Maturity Consideration, payable in cash or stock at the Combined Company’s option.
+Added: If the Combined Company elected to pay the Maturity Consideration in cash, the amount of cash on hand to fund operations would be reduced accordingly, which could adversely affect the Combined Company’s ability to make necessary investments, and, therefore, could adversely affect its results of operations.
+Added: Other events may result in Meteora having no payment obligations to the Combined Company at settlement under the Forward Purchase Agreement.
+Added: In addition to the risk of a substantial decline in the market price of the shares of Class A Common Stock, the occurrence of certain events will accelerate the maturity date and may result in Meteora having no payment obligation to the Combined Company at settlement.
+Added: Such events include (a) if the VWAP Price, for any 20 trading days during a 30 consecutive trading day-period beginning 30 days following the closing of the Merger, is below $5.00 per share, (b) if the Combined Company’s shares of Class A Common Stock cease to be listed on a national securities exchange or upon the filing of a Form 25, or (c) if the Registration Statement is not declared effective by the Commission within the time periods set forth in the Forward Purchase Agreement, or if the Registration Statement after it is declared effective ceases to be continuously effective as required by the Forward Purchase Agreement, which will result in the unregistered shares being excluded from the calculation of the amounts due at settlement.
+Added: Shares sold under the Forward Purchase Agreement will not count towards the Combined Company’s Public Float.
+Added: Nasdaq has indicated in its FAQs that because the investor to the Forward Purchase Agreement (in our case, Meteora) may suffer a loss from trading below certain thresholds, but can recoup the purchase price by withholding from trading, they provide an economic disincentive for the investor to sell the security in certain circumstances, and Nasdaq may treat such economic resale disincentives and a resale restriction for purposes of determining whether the securities are “restricted securities” under Nasdaq regulations, and therefore the Combined Company’s public float could be adversely affected, the shares available for trading to public investors may be restricted and it may be more difficult for MCAC to meet Nasdaq’s initial listing standards and consummate the Business Combination.
Risks Relating to our Securities
4 unchanged sentences
For example, if the Anchor Investors continue to hold the shares they purchased in the IPO and vote such shares in favor of our initial business combination (although they are not contractually obligated to, their interest in our Founder Shares directly or in the sponsor may provide an incentive for them to do so), we would not need any additional public shares to be voted in favor of our initial business combination to have our initial business combination approved.
−Removed: This potential concentration
−Removed: of influence could be disadvantageous to other stockholders with interests different from those of our Sponsor and the Anchor Investors.
+Added: This potential concentration of influence could be disadvantageous to other stockholders with interests different from those of our Sponsor and the Anchor Investors.
In addition, this potential significant concentration of stock ownership may adversely affect the trading price of our public shares because investors often perceive disadvantages in owning shares in companies with principal stockholders and might make it more difficult to complete a business combination with targets that would prefer to enter into a transaction with a SPAC with less concentrated ownership.
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The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because our Units, Class A Common Stock, Public Warrants and Public Rights are listed on Nasdaq, our Units, Class A Common Stock, Public Warrants and Public Rights will be covered securities.
−Removed: Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate
−Removed: companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case.
+Added: Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case.
While we are not aware of a state having used these powers to prohibit or restrict the sale of securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states.
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If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification.
−Removed: However, there may be instances in which holders of our public warrants may be unable to exercise such public warrants but holders of our placement warrants may be able to exercise such placement warrants.
+Added: However, there may be instances in which
+Added: holders of our public warrants may be unable to exercise such public warrants but holders of our placement warrants may be able to exercise such placement warrants.
If you exercise your Public Warrants on a “cashless basis”, you will receive fewer shares of Class A Common Stock from such exercise than if you were to exercise such warrants for cash.
1 unchanged sentence
First, if a registration statement covering the shares of Class A Common Stock issuable upon exercise of the warrants is not effective by the 52nd day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption.
−Removed: Second, if our Class A Common Stock is at any time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of Public Warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the
−Removed: event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
+Added: Second, if our Class A Common Stock is at any time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of Public Warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
Third, if we call the Public Warrants for redemption, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis.
9 unchanged sentences
These provisions of our amended and restated certificate of incorporation, like all provisions of our amended and restated certificate of incorporation, may be amended with the approval of our stockholders.
−Removed: However, our executive officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months if we use our options to extend the period of time to consummate an initial business combination) from the closing of our Initial Public Offering or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.
+Added: However, our executive officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of our Initial Public Offering or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.
The issuance of additional shares of common or preferred stock:
21 unchanged sentences
Accordingly, we may amend the terms of the Public Warrants in a manner adverse to a holder if holders of at least a majority of the then outstanding Public Warrants approve of such amendment.
−Removed: Although our ability to amend the terms of the Public Warrants with the consent of at least a majority of the then outstanding Public Warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the Warrants, convert the Warrants into cash or stock, shorten the exercise period or decrease the number of shares of our Class A Common Stock purchasable upon exercise of a Warrant.
+Added: Although our ability to amend the terms of the Public Warrants with the consent of at least a majority of the then outstanding Public Warrants is unlimited, examples of such amendments could be amendments
+Added: to, among other things, increase the exercise price of the Warrants, convert the Warrants into cash or stock, shorten the exercise period or decrease the number of shares of our Class A Common Stock purchasable upon exercise of a Warrant.
We may amend the terms of the Public Rights in a way that may be adverse to holders with the approval by the holders of a majority of the then outstanding Public Rights.
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We will use our best efforts to register or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering.
−Removed: Redemption of the outstanding warrants could force you (i) to exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your warrants at the then-current market price when you might otherwise wish to hold your warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of your warrants.
+Added: Redemption of the outstanding warrants could force you (i) to exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your warrants at the
+Added: then-current market price when you might otherwise wish to hold your warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of your warrants.
Our Warrants, Public Rights and Founder Shares may have an adverse effect on the market price of our Class A Common Stock and make it more difficult to effectuate our initial business combination.
1 unchanged sentence
The Founder Shares are convertible into shares of Class A Common Stock on a one-for-one basis, subject to adjustment as set forth herein.
−Removed: In addition, if our Sponsor or its affiliates, or any of our officers or directors, makes any Working Capital Loans, up to $1,500,000 of such loans may be converted into Private Placement-equivalent warrants at a price of $1.00 per warrant (which, for example, would result in the holders being issued 1,500,000
−Removed: warrants if $1,500,000 of notes were so converted), at the option of the lender.
+Added: In addition, if our Sponsor or its affiliates, or any of our officers or directors, makes any Working Capital Loans, up to $1,500,000 of such loans may be converted into Private Placement-equivalent warrants at a price of $1.00 per warrant (which, for example, would result in the holders being issued 1,500,000 warrants if $1,500,000 of notes were so converted), at the option of the lender.
Such warrants would be identical to the Private Placement Warrants, including as to exercise price, exercisability and exercise period.
5 unchanged sentences
Unlike some other blank check companies, if
−Removed: (i) we issue additional shares of Class A Common Stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at a Newly Issued Price of less than $9.20 per share,
−Removed: (ii) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and
−Removed: (iii) the Market Value is below $9.20 per share, then the exercise price of the warrants will be adjusted to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price.
+Added: ● we issue additional shares of Class A Common Stock or equity-linked securities for capital raising purposes in
+Added: ● connection with the closing of our initial business combination at a Newly Issued Price of less than $9.20 per share,
+Added: ● the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and
+Added: ● the Market Value is below $9.20 per share, then the exercise price of the warrants will be adjusted to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price.
This may make it more difficult for us to consummate an initial business combination with a target business.
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Our amended and restated certificate of incorporation requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions against our directors, officers, other employees or stockholders for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel, which may have the effect of discouraging lawsuits against our directors, officers, other employees or stockholders .
−Removed: Our amended and restated certificate of incorporation requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions against our directors, officers, other employees or stockholders for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing
−Removed: the suit will be deemed to have consented to service of process on such stockholder’s counsel except any action (A) as to which the Court of Chancery in the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or (C) for which the Court of Chancery does not have subject matter jurisdiction.
+Added: Our amended and restated certificate of incorporation requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions against our directors, officers, other employees or stockholders for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel except any action (A) as to which the Court of Chancery in the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or (C) for which the Court of Chancery does not have subject matter jurisdiction.
Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and consented to the forum provisions in our amended and restated certificate of incorporation.
9 unchanged sentences
Our independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going concern”.
−Removed: As of December 31, 2022, we had $5,938 in cash and working capital deficit of $1,605,220, excluding the income and franchise tax liabilities, as these tax liabilities will be paid using the dividend and interest income earned in the Trust Account.
+Added: As of December 31, 2023, we had $5,947 in cash and a working capital deficit of $6,843,119.
Further, we expect to incur significant costs associated with the business combination.
−Removed: We are required to complete a business combination within 12 months of the Initial Public Offering date, absent any extensions available at our option up to two times by an additional three months each time, at $0.10 per extension per share of our Class A Common Stock subject to possible redemption paid into the Trust Account by the Sponsor (the “Extension Option”).
−Removed: Considering that the Sponsor’s ability to fund the Extension Option is uncertain, we may be required to dissolve within 12 months of the Initial Public Offering date, should an initial business combination not be consummated within that timeframe.
+Added: We are required to complete a business combination within 24 months of the Initial Public Offering date, unless this period is extended through the shareholders’ approval.
+Added: Considering that the Sponsor’s ability to fund the Current Extension is uncertain, we may be required to liquidate by May 13, 2024, should an initial business combination not be consummated within that timeframe.
We may need to raise additional capital through loans or additional investments from its Sponsor, stockholders, officers, directors, or third parties.
We may not be able to obtain additional financing.
−Removed: If we are unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses.
These factors, among others, raise substantial doubt about our ability to continue as a going concern assuming an initial business combination is not consummated.
The consolidated financial statements contained elsewhere in this Annual Report on Form 10-K do not include any adjustments that might result from our inability to consummate a business combination or our inability to continue as a going concern.
−Removed: In connection with our management team’s monitoring and review of our internal control over financial reporting, we identified two material weaknesses:
−Removed: the first was reported as of June 30, 2022 and the second was reported as of and for the year ended December 31, 2022.
+Added: In connection with our management team’s monitoring and review of our internal control over financial reporting, we identified six material weaknesses.
Any future material weakness in our internal control over financial reporting could adversely affect our ability to report our financial condition and results of operations accurately or on a timely basis and materially and adversely affect our business, financial condition, results of operations and reputation.
4 unchanged sentences
As of and for the year ended December 31, 2022, we also identified a material weakness in internal control over financial reporting related to accounting for complex financial instruments.
−Removed: Specifically, management concluded that it had not operated or maintained controls at a sufficient level of precision to recognize properly certain financial instruments as of and for the year ended December 31, 2022.
+Added: Specifically, the control deficiency was identified in connection with the accounting for the Forward Purchase Agreement entered into on December 31, 2022.
+Added: Management concluded that it had not operated or maintained controls at a sufficient level of precision to recognize properly certain financial instruments as of and for the year ended December 31, 2022.
Management has concluded that this control deficiency constitutes a material weakness.
Management did not identify a material misstatement within our financial statements in this or any previously filed quarterly report on Form 10Q or annual report on Form 10-K as a result of this material weakness.
+Added: Management identified errors in the Form of Warrant Agreement between the Company and Continental Stock Transfer & Trust Company as filed with the Company’s registration statement on Form S-1 on April 22, 2022, and the Warrant Agreement, dated May 10, 2022, by and between the Company and Continental Stock Transfer & Trust Company, as filed with the Company’s Current Report on Form 8-K filed with the SEC on May 16, 2022 (the “Warrant Agreement”).
+Added: The Warrant Agreement as filed was incorrect and inconsistent with the terms of the Company’s registration statement on Form S-1 filed with the SEC on April 22, 2022 and the terms of the Company’s prospectus filed with the SEC on May 12, 2022.
+Added: On June 24, 2022, the Company filed a Current Report on Form 8 -K including the Amended and Restated Warrant Agreement containing the correct provisions.
+Added: Further, in April 2023, the Company withdrew $302,000 of interest and dividend income earned in the Trust Account.
+Added: Such amount was restricted for payment of the Company’s income tax liabilities as provided in the Company’s charter.
+Added: During the second quarter of 2023, $87,000 of these funds were inadvertently used for the payments of general operating expenses.
+Added: Such amounts were disbursed without appropriate review and approval to ensure that the disbursements were made in accordance with the investment management trust agreement between Continental Stock Transfer & Trust Company and the Company.
+Added: As a result of this issue, management concluded that a material weakness exists in our internal control over financial reporting related to the review and approval of cash disbursements.
+Added: Such funds were replenished to the Company’s operating account by ConnectM on August 21, 2023 in the form of a working capital loan with the same terms as the Working Capital Loans from the Sponsor.
+Added: During the third quarter of 2023, additional funds restricted for payment of the Company’s income tax liabilities totaling approximately $215,000 were utilized for the payments of general operating expenses.
+Added: As of September 30, 2023, the funds were replenished to the Company’s operating account by ConnectM in the form of a working capital loan with the same terms as the Working Capital Loans from the Sponsor.
+Added: Between October 12, 2023 and November 10, 2023, additional funds restricted for payment of the Company’s income tax liabilities totaling approximately $58,000 were utilized for the payments of general operating expenses and were subsequently replenished to the Company’s operating account on November 13, 2023 by ConnectM in the form of a working capital loan with the same terms as the Working Capital Loans from the Sponsor.
+Added: As a result of the continued improper use of funds reserved for payment of the Company’s tax liabilities, management concluded that there is a material weakness in the Company’s internal controls related to the oversight by the Company’s board of directors.
+Added: Additionally, as the Company had delays in remitting the income tax payment, management concluded that a material weakness exists surrounding the Company’s tax compliance.
We have commenced a remediation plan with the goal of remediating these material weaknesses as soon as possible.
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Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data.
−Removed: As an early stage company without significant investments in data security protection,
−Removed: we may not be sufficiently protected against such occurrences.
+Added: As an early stage company without significant investments in data security protection, we may not be sufficiently protected against such occurrences.
We may not have sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents.
9 unchanged sentences
We are an emerging growth company and a smaller reporting company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to emerging growth companies and smaller reporting companies, this could make our securities less attractive to investors and may make it more difficult to compare our performance with other public companies.
−Removed: We are an “emerging growth company” within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
+Added: We are an “emerging growth company” within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging
+Added: growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
As a result, our stockholders may not have access to certain information they may deem important.
8 unchanged sentences
Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements.
−Removed: We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the end of the prior June 30th, or (2) our annual revenues exceeded $100 million during such completed fiscal year
−Removed: and the market value of our common stock held by non-affiliates exceeds $700 million as of the prior June 30th.
+Added: We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the end of the prior June 30th, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the prior June 30th.
To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our consolidated financial statements with other public companies difficult or impossible.
−Removed: UNRESOLVED STAFF COMMENTS
−Removed: Our principal executive offices are located at 419 Webster Street, Monterey, California, 93940, and our telephone number is (831) 649-7388.
−Removed: We consider our current office space adequate for our current operations.
−Removed: LEGAL PROCEEDINGS
−Removed: To the knowledge of our management, there is no litigation currently pending or contemplated against us, any of our officers or directors in their capacity as such or against any of our property.
−Removed: MINE SAFETY DISCLOSURES
−Removed: Not applicable.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.