What changed in this filing

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Item 1. Business

2023-03-31 compared with 2022-03-30 · 520 added, 958 removed, 2 unchanged (100% of the section changed)

information included in this Annual Report on Form 10-K should be read in conjunction with the consolidated financial statements and

related notes following Item 16 of this Annual Report on Form 10-K.

see the definitions above for a list of terms used throughout this Report.

of our logos, trademarks or tradenames may be used in this Report.

This Report also includes trademarks, tradenames and service marks

that are the property of others.

Solely for convenience, trademarks, tradenames and service marks referred to in this Report may appear

without the ® , ™ and SM symbols.

References to our trademarks, tradenames and service marks are not intended to indicate

in any way that we will not assert to the fullest extent under applicable law our rights or the rights of the applicable licensors if

any, nor that respective owners to other intellectual property rights will not assert, to the fullest extent under applicable law, their

rights thereto.

We do not intend the use or display of other companies’ trademarks and trade names to imply a relationship with,

or endorsement or sponsorship of us by, any other companies.

market data and certain other statistical information used throughout this Report are based on independent industry publications, reports

by market research firms or other independent sources that we believe to be reliable sources.

Industry publications and third-party research,

surveys and studies generally indicate that their information has been obtained from sources believed to be reliable, although they do

not guarantee the accuracy or completeness of such information.

We are responsible for all of the disclosures contained in this Report,

and we believe these industry publications and third-party research, surveys and studies are reliable.

While we are not aware of any

misstatements regarding any third-party information presented in this Report, their estimates, in particular, as they relate to projections,

involve numerous assumptions, are subject to risks and uncertainties, and are subject to change based on various factors, including those

discussed under the section entitled “Risk Factors” of this Report.

These and other factors could cause our future performance

to differ materially from our assumptions and estimates.

Some market and other data included herein, as well as the data of competitors

as they relate to the Company is also based on our good faith estimates.

Organizational History

We are a newly organized blank check company incorporated

as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase,

reorganization, or similar business combination with one or more businesses, which we refer to throughout this Annual Report as our initial

business combination.

We have had discussions with potential business combination targets in the energy sector, including energy transition

and renewable fuels industries.

Initial Public Offering

registration statement for our IPO was declared effective on August 12, 2021.

On August 17, 2021, we consummated our IPO of 15,000,000 units.

Each unit consists of one Class A common stock of the Company, par value $0.0001 per share, and three-quarters of one redeemable

warrant of the Company, each whole Warrant entitling the holder thereof to purchase one Class A common stock for $11.50 per share.

The units were sold at a price of $10.00 per unit, generating gross proceeds to the Company of $150,000,000.

qualified institutional buyers or institutional accredited investors which are not affiliated with any member of the Company’s

management have purchased up to 1,485,000 units in the IPO at the offering price of $10.00 per unit, generating gross

proceeds of $14,850,000 included in the gross proceeds from units offered to public of $150,000,000.

connection with the closing of the IPO, the Sponsor sold membership interest reflecting an allocation of 75,000 founder shares,

or an aggregate of 825,000 founder shares, to each anchor investor at their original purchase price of approximately $0.0058 per

Substantially

with the closing of the IPO, the Company completed the private sale of an aggregate of 6,000,000 warrants to the Sponsor and

the Underwriters at a purchase price of $1.00 per Private Placement Warrant, generating gross proceeds to the Company of $6,000,000.

The Private Placement Warrants are identical to the Warrants sold in the IPO, except that the Sponsor and the Underwriters agreed not

to transfer, assign or sell any of the Private Placement Warrants (except to certain permitted transferees) until 30 days after the completion

of the Company’s initial Business Combination.

underwriters had a 45-day option from the date of the Company’s IPO to purchase up to an additional 2,250,000 Units to

cover over-allotments, if any.

On August 19, 2021, the underwriters exercised the over-allotment in full, at $10.00 per Unit, generating

additional gross proceeds of $22,500,000.

Simultaneously with the closing of the over-allotment, the Company consummated the sale of

additional 450,000 Private Placement Warrants to the Sponsor, and additional 225,000 Private Placement Warrants to

the Underwriters, at $1.00 per warrant, generating gross proceeds to the Company of $675,000.

Transaction costs of our initial public offering and

the over-allotment amounted to $17,771,253 consisting of $3,450,000 of underwriting discount, $6,037,500 of deferred underwriting discount,

an excess of fair value of the founder shares acquired by the Anchor Investors of $6,265,215, fair value of the 189,750 representative

shares of $1,442,100 and $576,438 of other cash offering costs were charged to additional paid in capital.

of $174,225,000 was placed in a U.S.-based trust account maintained by Continental Stock Transfer & Trust Company, acting as

Our units, public shares and public warrants are

each traded on the NASDAQ Stock Market under the symbols “CENQU,” “CENQ” and “CENQW,” respectively.

Business Strategy and Management Team Experience

Our Management Team Experience

management team has extensive experience in identifying and executing potential acquisitions across the upstream, downstream

and midstream energy sectors.

In addition, our team has significant hands-on experience working with oil

companies across all sectors and serving as active owners and directors working closely with energy companies to create value in the

public markets.

acquisition strategy will leverage our management team’s extensive experience and relationships built over more than 170 combined

years of forming, financing, and operating public and private oil and gas companies, and the financial and operational expertise of the

rest of our team, to identify potential proprietary and public transaction opportunities that we believe could benefit from our knowledge

and experience and that offer the potential for an attractive risk-adjusted return profile under our ownership.

Our management team has

developed a broad network of contacts and corporate relationships over their careers that we believe will serve as a useful source of

acquisition opportunities.

Our ability to evaluate public/private and brokered/non-brokered deals provides us exposure to a broad set

of potential acquisition opportunities in the energy sector that may not broadly available to our potential competitors.

will seek to capitalize on the extensive experience of each of the members of our management team.

The members of our management team,

including John B.

Connally III, J.

Russell Porter and Michael Mayell, each have a history of creating significant value and generating

attractive shareholder returns.

Russell Porter, has sourced and financed the acquisition of over 150 oil and gas producing properties in multiple basins within

North America.

While Executive Vice President of Forcenergy Inc., Mr.

Porter lead the acquisition team that acquired over 125 separate

producing assets in 29 transactions with aggregate net production at the time of acquisition of 18,500 BOPD and 146 MMCFD and proven

reserves of 54 million barrels of oil and 273 Bcf of natural gas.

Porter was CEO of Gastar Exploration, Inc.

he structured the acquisition of approximately 160,000 acres in the Sooner Trend of Oklahoma from Chesapeake Energy in 2013 for $80 million

in a negotiated transaction.

Shortly after closing, approximately one half of that acreage position was sold to Newfield Exploration

for $80 million.

Before that, Mr.

Porter identified and captured an onshore coal bed methane opportunity in New South Wales, Australia,

brought in an Australian operating partner and arranged an exit from the project realizing an approximate 6:1 return on investment.

of our management team and Board are not obligated to devote any specific number of hours to our matters, but they intend to devote as

much of their time as they deem necessary to our affairs until we have completed our initial business combination.

The amount of time

that any members of our management team or our Board will devote in any time period will vary based on whether a target business has

been selected for our initial business combination and the current stage of the business combination process.

believe the operational and transactional experience and industry relationships of our management team and Board will provide us with

a substantial number of potential business combination targets.

Over the course of their careers, the members of our management team

and our Board have developed a broad network of contacts and corporate relationships around the world.

This network has grown through

the activities of our management team and our Board sourcing, acquiring and financing businesses, and building relationships with sellers,

financing sources and management teams.

The members of our management team and our Board also have a proven track record of executing

transactions under varying economic and financial market conditions, which we believe will make us an attractive partner to potential

target businesses.

management team also has extensive experience in energy joint ventures.

Porter structured a joint venture between Gastar

and Chesapeake Energy in which Chesapeake acquired 33% of Gastar’s Deep Bossier play in East Texas along with a 20% equity ownership

stake in Gastar’s common stock.

Porter lead Gastar’s formation of a joint venture in the Marcellus and Utica

plays with a South Korean E&P company that resulted in the joint development of Gastar’s 40,000-acre lease position.

in 2016, he oversaw the formation of a “Drilco” type joint venture between Gastar and a New York based hedge fund for

the drilling of development wells in Kingfisher County, Oklahoma within the “STACK” play.

Our Business Strategy

addition to industry and lending community relationships, we plan to leverage relationships with management teams of public and private

companies, family offices, private equity firms, investment bankers, restructuring advisers, attorneys and accountants, which we believe

should provide us with numerous business combination opportunities.

Members of our management team and Board will communicate with their

networks of relationships to articulate the parameters for our search for a target business and a potential business combination and

begin the process of pursuing and reviewing said targets.

possibility we are exploring is identifying and acquiring long-lived assets with relatively stable decline profiles and low fixed costs

supported by existing production and cash flow, but that we believe are underperforming their potential due to capital starvation, shifting

ownership focus or geographical stranding.

We believe that especially in today’s financial and commodity markets, otherwise fundamentally

sound companies can underperform their full-potential due to numerous factors, including lack of capital, a temporary period of dislocation

in the markets in which they operate, over-leveraged capital structures, excessive cost structures, incomplete management teams and/or

business strategies that no longer appeal to capital markets.

Our management team has extensive experience in identifying and executing

such full-potential acquisitions in the energy industry.

We plan to capitalize on the broad range of our team’s skill sets, backgrounds,

experiences, and other intellectual capital, to identify and realize unexploited value.

Our management team and Board have successfully

executed on this business strategy across multiple energy market cycles, identifying value that the broader market has not recognized

and acquiring assets at attractive valuations.

Furthermore, we believe that the current market allows for capturing assets at attractive

valuations while also taking a conservative approach to valuation.

When implementing our business strategy, we will be agnostic about

commodity type (e.g., oil or gas) and will place significant emphasis on cash-on-cash returns, which we plan to maximize by employing

a conservative capital allocation strategy based on full cycle economics.

We intend to mitigate risk through commodity price hedging

that will be employed for any producing assets to minimize commodity price risk and lock in projected returns.

By using a disciplined

approach to capital allocation, both at the time of acquisition and the subsequent optimization of the target, we believe that we can

generate meaningful returns for our equity holders.

Our objective is to form a sustainable business with multiple competitive advantages

and the potential to generate meaningful cash flow in excess of its capital.

We believe that a new business model for publicly traded

energy companies is emerging that will be based on returning capital to shareholders, either through debt reduction, share buy-backs

or dividends.

Inherent in the ability to return capital to shareholders will be a disciplined approach to management that is highly selective

of acquisitions, maintains a low leverage profile and keeps overhead costs low.

We would expect to grow the business over time, both

organically and through acquisitions, with a focus on achieving attractive risk-adjusted returns for our stockholders, while maintaining

conservative balance sheet metrics.

Commodity prices have increased recently due to

multiple factors.

We believe that these factors will continue to influence commodity prices well into 2022.

In addition, both public

and private capital available to the E&P sector has become scarce, limiting the pool of potential asset purchasers, as well as

limiting existing companies’ operational flexibility.

Escalating tensions resulting from the Russian invasion of Ukraine could

lead to increased volatility in global oil and gas prices, including due to increases in oil production by Russia to finance its

activities in Ukraine or to destabilize global oil and gas prices.

We will also evaluate opportunities to extend our management

team’s energy expertise into energy asset related activities that utilize “green” or “clean”

components of the energy chain, such as hydrogen-based or renewable fuel supplies or carbon sequestration associated with oil and

gas production, as well as natural gas derivative plays such as helium extraction.

Many of these types of opportunities may involve

traditional oil and gas products as a base and utilize additional processing or technologies to enhance the value proposition.

Acquisition Criteria

with our acquisition strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating

prospective target assets and/or businesses.

We will use these criteria and guidelines in evaluating acquisition opportunities.

we intend to acquire companies or assets that we believe exhibit one or more of the following characteristics, we may decide to enter

into our initial business combination with a target business that does not meet these criteria and guidelines.

We intend to focus on

companies or assets that we believe have the following characteristics:

we will seek to acquire companies or assets with the

ability to generate attractive returns based upon conservative reserve or asset valuations.

● Operational

we will seek to acquire companies or assets over which

we will have operational control.

This will allow our management team to use their operational

and financial expertise to create value from existing assets and have control over future

capital deployment.

● Optimization

of Operations:

we will seek to acquire assets or companies that:

● present opportunities

to reduce costs, increase production or otherwise optimize operations that would result in

near-term improved economics and returns to shareholders;

● have been underinvested

in by current owners due to, among other causes, liquidity limitations resulting from the

current commodity price environment, the capital intensity of other operations and balance

sheet considerations;

● are at an inflection

point requiring additional capital, additional operational expertise or are susceptible to

innovative and superior optimization techniques that drive improved financial performance.

● Ease of Operating:

Safety, Security, Environmental and Social (“HSSES”) standards, procedures and

performance will be a critical element of future operational activity;

historical records

and performance will be an essential element in assessing suitability for future efficient

and effective performance.

We will attempt to avoid operations that result in the potential

for harmful greenhouse gas emissions and will seek to use industry “best practices”

for minimizing the environmental impact of all operations.

criteria are not intended to be exhaustive.

Any evaluation relating to the merits of a particular initial business combination may be

based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management

may deem relevant.

If we decide to enter into our initial business combination with a target business that does not meet the above criteria

and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related

to our initial business combination, which would be in the form of proxy solicitation materials or tender offer documents that we would

file with the SEC.

Initial Business Combination

initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least

80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the income earned on

the trust account) at the time of the agreement to enter into the initial business combination.

If our Board is not able to independently

determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking

firm that is a member of the Financial Industry Regulatory Authority or FINRA or an independent accounting firm with respect to the satisfaction

of such criteria.

Except as required by applicable law, our stockholders may not be provided with a copy of such opinion, nor will they

be able to rely on such opinion.

party may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds

to complete the acquisition by issuing a class of equity or equity-linked securities to specified purchasers that we may determine in

connection with financing our initial business combination.

We refer to this potential future issuance, or a similar issuance to other

specified purchasers, as a “specified future issuance” throughout this Annual Report.

The amount and other terms and conditions

of any such specified future issuance would be determined at the time thereof.

We are not obligated to make any specified future issuance

and may determine not to do so.

This is not an offer for any specified future issuance.

Pursuant to the anti-dilution provisions of our

Class B common stock, any such specified future issuance would result in an adjustment to the conversion ratio such that our initial

stockholders and their permitted transferees, if any, would retain their aggregate percentage ownership at 20% of the sum of the total

number of all shares of common stock outstanding plus all shares issued in the specified future issuance, unless the holders of a majority

of the then outstanding shares of Class B common stock agreed to waive such adjustment with respect to the specified future issuance

at the time thereof.

We cannot determine at this time whether a majority of the holders of our Class B common stock at the time

of any such specified future issuance would agree to waive such adjustment to the conversion ratio.

If such adjustment is not waived,

the specified future issuance would not reduce the percentage ownership of holders of our Class B common stock but would reduce

the percentage ownership of holders of our Class A common stock.

If such adjustment is waived, the specified future issuance would

reduce the percentage ownership of holders of both classes of our common stock.

Our Acquisition Process

believe that conducting comprehensive due diligence on prospective investments is particularly important within the energy sector.

will use the diligence, rigor, and expertise of our management, members of our Board and our technical committee to evaluate potential

targets’ strengths, weaknesses, and opportunities to identify the relative risk and return profile of any potential target for

our initial business combination.

Given our management team’s tenure investing in energy companies, we will often be familiar with

the prospective target area of operation, upside potential and potential risks.

evaluating a prospective initial business combination, we expect to conduct a thorough diligence review that will encompass, among other

things, meetings with incumbent management and employees, document reviews, inspection of assets and facilities and financial analyses,

as well as a review of other information that will be made available to us.

ability to evaluate assets and/or businesses is greatly enhanced by the prior experience and expertise of our management team and technical

We plan to incorporate a rigorous due diligence process that will lever the diverse experience and talents of management and

the Technical Committee.

of our officers and directors are employed by or affiliated with various investment companies or funds.

Such funds and individuals

are continuously made aware of potential investment opportunities, one or more of which we may desire to pursue for a business

combination, but we have not (nor has anyone on our behalf, including members of our Board) contacted any prospective target

business or had any substantive discussions, formal or otherwise, with respect to a business combination transaction with any

prospective target business.

may, at our option, pursue an opportunity with an entity to which an officer or director has a fiduciary or contractual obligation.

such entity may co-invest with us in the target business at the time of our initial business combination, or we could raise additional

proceeds to complete the acquisition by making a specified future issuance to any such entity.

Our amended and restated certificate of

incorporation provides that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity

is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one

we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue.

Status as a Public Company

believe our structure will make us an attractive business combination partner to target businesses.

As an existing public company, we

offer a target business an alternative to the traditional initial public offering through a merger or other business combination.

this situation, the owners of the target business would exchange their shares of stock in the target business for shares of our stock

or for a combination of shares of our stock and cash, allowing us to tailor the consideration to the specific needs of the sellers.

there are various costs and obligations associated with being a public company, we believe target businesses will find this method a

more certain and cost-effective method to becoming a public company than the typical initial public offering.

In a typical initial public

offering, there are additional expenses incurred in marketing, road show and public reporting efforts that may not be present to the

same extent in connection with a business combination with us.

once a proposed business combination is completed, the target business will have effectively become public, whereas an initial public

offering is always subject to the underwriters’ ability to complete the offering, as well as general market conditions, which could

delay or prevent the offering from occurring or could have negative valuation consequences.

Once public, we believe the target business

would then have greater access to capital and an additional means of providing management incentives consistent with stockholders’

It can offer further benefits by augmenting a company’s profile among potential new customers and vendors and aid in

attracting talented employees.

are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act.

such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public

companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor

attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation

in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive

compensation and stockholder approval of any golden parachute payments not previously approved.

If some investors find our securities

less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more

addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended

transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards.

other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would

otherwise apply to private companies.

We do not intend to take advantage of the benefits of this extended transition period and our election

to opt out is irrevocable.

will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary

of the completion of the IPO, (b) in which we have total annual gross revenue of at least $1.07 billion (as adjusted for inflation

pursuant to SEC rules from time to time), or (c) in which we are deemed to be a large accelerated filer, which means the market

value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30 th , and

(2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

the context otherwise requires, all references in this Item 1 to “Company,” “we,” “us” or “our”

refer to Verde Clean Fuels refer to Intermediate and its subsidiaries prior to the Closing and Verde Clean Fuels and its subsidiaries

following the Closing.

the year ended December 31, 2022 and prior to the Business Combination, CENAQ was a blank check company incorporated for the purpose

of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or

more businesses.

For more information on the Business Combination, see the section entitled “Explanatory Note” elsewhere

in this Report.

the Business Combination, Verde Clean Fuels is a renewable energy company specializing in the conversion of synthesis gas, or syngas,

derived from diverse feedstocks, such as biomass, municipal solid waste (“MSW”) and mixed plastics, as well as natural gas

(including synthetic natural gas) and other feedstocks, into liquid hydrocarbons that can be used as gasoline through an innovative and

proprietary liquid fuels technology, the STG+® process.

Through our STG+® process, we convert syngas into Reformulated Blend-stock for

Oxygenate Blending (“RBOB”) gasoline.

We are focused on the development of technology and commercial facilities aimed at

turning waste and other bio-feedstocks into a usable stream of syngas which is then transformed into a single finished fuel, such as

gasoline, without any additional refining steps.

The availability of biogenic MSW and the economic and environmental drivers that divert

these materials from landfills will enable us to utilize these waste streams to produce renewable gasoline from modular production facilities

with expected capacity to produce between approximately seven million to 30 million gallons of renewable gasoline per year.

are redefining liquid fuels technology through our proprietary and innovative STG+® process to deliver scalable and cost-effective

renewable gasoline.

We acquired our STG+® technology from Primus Green Energy (“Primus”), a company established in 2007

that developed the patented STG+® technology to convert syngas into gasoline or methanol.

Since acquiring the technology, we have

adapted the application of our STG+® technology to focus on the renewable energy industry.

This adaptation requires a third-party

gasification system to produce acceptable synthesis gas from these renewable feedstocks.

Our proprietary STG+® system converts the

syngas into gasoline.

We have made significant progress towards commercializing

the first STG+® based commercial production facility in the United States.

Our first commercial production facility, which we expect

to be operational by the first half of 2025, will be in Maricopa, Arizona.

In the first phase we expect this facility to produce approximately

7 million gallons of renewable gasoline in the first full year of operations.

In the second phase, which we expect to be operational in

2026, we anticipate producing approximately 30 million gallons per year of renewable gasoline.

Additionally, we have several additional

renewable gasoline projects, and flare mitigating natural gas to gasoline project, in various early stages of development.

Over $110 million has been invested in our technology, including our

demonstration facility in New Jersey, which has completed over 10,500 hours of operation producing gasoline or methanol.

Our demonstration

facility represents the scalable nature of our operational modular commercial design which has fully integrated reactors and recycle lines

and is designed with key variables, like gas velocity and catalyst bed length, at a 1-to-1 scale with our commercial design.

participated in carbon lifecycle studies to validate the CI score and reduced lifecycle emissions of our renewable gasoline as well as

fuel, blending and engine testing to validate the specification and performance of our gasoline product.

We believe our renewable gasoline

exhibits a significant lifecycle carbon emissions reduction compared to traditional petroleum-based gasoline.

As a result, we believe

our gasoline produced from renewable feedstock, such as biomass, will qualify under the federal renewable fuel standard (“RFS”)

program for the D3 renewable identification number (“RIN”) (a carbon credit), which can have significant value.

gasoline produced from our process may also qualify for various state carbon programs, including California’s Low Carbon Fuel Standard

Unlike many other gas-to-liquids technologies, not only can our STG+® process produce renewable gasoline from

syngas, but we expect it will be able to be applied at other production facilities to produce other end products including methanol.

addition to our initial focus on the production of renewable gasoline, there is opportunity to continue to develop additional process

technology to produce middle distillates including sustainable diesel and sustainable aviation fuel.

As of December 31, 2022, the Company

has not derived revenue from its principal business activities.

The Company is managed as an integrated business and consequently, there

is only one reportable segment.

However, as with other government programs, the use requirements of the RFS program and other similar

state-level programs are subject to change, which could materially harm our ability to operate profitably.

Growth Strategy

intend to grow our business by leveraging our competitive advantages in the design and implementation of small-scale modular facilities

that can be situated in proximity to renewable feedstock sources.

We believe we have a number of avenues to achieve our growth objectives:

and Development of Commercial Production Facilities

critical step in our success will be the successful construction and operation of the first commercial production facility using our

STG+® technology.

In April 2022, we commenced a pre-FEED study for our first commercial production facility in Maricopa, Arizona,

and we are actively engaged in activities associated with securing the location, feedstock, utility interconnections and front-end gasification

for our first commercial facility.

We believe our commercialization activities are being completed at a pace that can support initial

commercial production of renewable gasoline as early as the first half of 2025.

plan to grow our business by building and operating a portfolio of commercial production facilities.

Currently, we have three additional

production facilities planned and four potential production facility development opportunities identified.

We also expect there to be

expansion opportunities at the approximately 700 landfills across the United States that intake sufficient volumes of MSW to supply one

of our facilities as well as numerous additional locations using other renewable feedstocks.

We believe the number of identified and

planned potential production facilities bode well for our potential future success.

We plan to commence pre-FEED studies on these three

additional production facilities in 2023 and complete two of the facilities in 2025 and the remaining facility in 2026.

We expect the

total capital expenditures for these additional production facilities to be approximately $900 million, and we expect to fund these projects

with equity and project-related debt.

of Commercial Operations and Customer Base

also expect to achieve growth through the expansion of our in-process projects as the facilities are expanded or otherwise begin to produce

renewable gasoline.

We also intend to license our technology in places where we do not anticipate deploying our own capital.

Additionally,

we are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K.

Smaller reporting companies may

take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial

We will remain a smaller reporting company until the last day of any fiscal year for so long as either (1) the market

value of our common stock held by non-affiliates did not exceed $250 million as of the prior June 30, or (2) our annual revenues

did not exceed $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates did not

exceed $700 million as of the prior June 30.

Financial Position

funds in the trust account available for a business combination initially in the amount of $174,225,000 in full ($10.10 per unit), in

each case before underwriting commissions, fees and expenses associated with our initial business combination, we offer a target business

a variety of options such as creating a liquidity event for its owners, providing capital for the potential growth and expansion of its

operations or strengthening its balance sheet by reducing its debt or leverage ratio.

Because we are able to complete our business combination

using our cash, debt or equity securities, or a combination of the foregoing, we have the flexibility to use the most efficient combination

that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires.

However, we have not taken

any steps to secure third party financing and there can be no assurance it will be available to us.

Effecting our Initial Business Combination

are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following the IPO.

to complete our initial business combination using cash from the proceeds of the IPO and the private placement of the private placement

warrants, our capital stock, debt or a combination of these as the consideration to be paid in our initial business combination.

seek to complete our initial business combination with a company or business that may be financially unstable or in its early stages

of development or growth, which would subject us to the numerous risks inherent in such companies and businesses.

our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account

are used for payment of the consideration in connection with our business combination or used for redemptions of our Class A common

stock, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance

or expansion of operations of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing

our initial business combination, to fund the purchase of other assets, companies or for working capital.

may seek to raise additional funds through a private offering of debt or equity securities in connection with the completion of our initial

business combination (which may include a specified future issuance), and we may complete our initial business combination using the

proceeds of such offering rather than using the amounts held in the trust account.

Subject to compliance with applicable securities laws,

we would expect to complete such financing only simultaneously with the completion of our business combination.

In the case of an initial

business combination funded with assets other than the trust account assets, our tender offer documents or proxy materials disclosing

the business combination would disclose the terms of the financing and, only if required by law, we would seek stockholder approval of

such financing.

There are no prohibitions on our ability to raise funds privately, including pursuant to any specified future issuance,

or through loans in connection with our initial business combination.

At this time, we are not a party to any arrangement or understanding

with any third party with respect to raising any additional funds through the sale of securities or otherwise.

time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs

associated with this process, are not currently ascertainable with any degree of certainty.

Any costs incurred with respect to the identification

and evaluation of a prospective target business with which our business combination is not ultimately completed will result in our incurring

losses and will reduce the funds we can use to complete another business combination.

Sources of Target Businesses

expect to receive a number of proprietary transaction opportunities to originate as a result of the business relationships, direct outreach,

and deal sourcing activities of our officers and directors.

In addition to the proprietary deal flow, we anticipate that target business

candidates will be brought to our attention from various unaffiliated sources, including investment banking firms, consultants, accounting

firms, private equity groups, large business enterprises, and other market participants.

These sources may also introduce us to target

businesses in which they think we may be interested on an unsolicited basis, since many of these sources will have read our reports and

know what types of businesses we are targeting.

Our officers and directors, as well as their affiliates, may also bring to our attention

target business candidates that they become aware of through their business contacts as a result of formal or informal inquiries or discussions

they may have, as well as attending trade shows or conventions.

Some of our officers or directors may enter into employment or consulting

agreements with the post-transaction company following our initial business combination.

The presence or absence of any such fees or

arrangements will not be used as a criterion in our selection process of an acquisition candidate.

In no event will our sponsor or any

of our existing officers or directors, or any entity with which they are affiliated, be paid any finder’s fee, consulting fee or

other compensation before, or for any services they render in order to effectuate, the completion of our initial business combination

(regardless of the type of transaction that it is).

However, in connection with the successful completion of our initial business combination,

we may determine to provide a payment to our sponsor, officers, directors, advisors or our or their affiliates, which payment would not

be made from the proceeds of the IPO held in the trust account.

We currently do not have any agreement or arrangement with our sponsor,

any of our officers, directors, advisors or our or their affiliates to make any such payments.

are not prohibited from pursuing an initial business combination with a business combination target that is affiliated with our sponsor,

officers or directors or making the acquisition through a joint venture or other form of shared ownership with our sponsor, officers

or directors.

In the event we seek to complete our initial business combination with a business combination target that is affiliated

with our sponsor, officers or directors, we, or a committee of independent directors, would obtain an opinion from an independent investment

banking firm which is a member of FINRA or an independent accounting firm that such an initial business combination is fair to our company

from a financial point of view.

We are not required to obtain such an opinion in any other context.

If any of our officers or directors

becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has pre-existing

fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity before

presenting such business combination opportunity to us.

Any such entity may co-invest with us in the target business at the time of our

initial business combination, or we could raise additional proceeds to complete the acquisition by making a specified future issuance

to any such entity.

Lack of Business Diversification

an indefinite period of time after the completion of our initial business combination, the prospects for our success may depend entirely

on the future performance of a single business.

Unlike other entities that have the resources to complete business combinations with

multiple entities in one or several industries, it is probable that we will not have the resources to diversify our operations and mitigate

the risks of being in a single line of business.

By completing our business combination with only a single entity, our lack of diversification

● subject us to negative

economic, competitive and regulatory developments, any or all of which may have a substantial

adverse impact on the particular industry in which we operate after our initial business

combination, and

● cause us to depend

on the marketing and sale of a single product or limited number of products or services.

Limited Ability to Evaluate the Target’s

Management Team

we intend to closely scrutinize the management of a prospective target business when evaluating the desirability of effecting our business

combination with that business, our assessment of the target business’ management may not prove to be correct.

In addition, the

future management may not have the necessary skills, qualifications or abilities to manage a public company.

Furthermore, the future

role of members of our management team or of our Board, if any, in the target business cannot presently be stated with any certainty.

While it is possible that one or more of our directors will remain associated in some capacity with us following our business combination,

it is presently unknown if any of them will devote their full efforts to our affairs after our business combination.

Moreover, we cannot

assure you that members of our management team will have significant experience or knowledge relating to the operations of the particular

target business.

The determination as to whether any members of our Board will remain with the combined company will be made at the time

of our initial business combination.

a business combination, to the extent that we deem it necessary, we may seek to recruit additional managers to supplement the incumbent

management team of the target business.

We cannot assure you that we will have the ability to recruit additional managers, or that additional

managers will have the requisite skills, knowledge or experience necessary to enhance the incumbent management.

Stockholders May Not Have the Ability to

Approve our Initial Business Combination

may conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC.

However, we will seek stockholder approval

if it is required by law or applicable stock exchange rule, or we may decide to seek stockholder approval for business or other legal

Presented in the table below is a graphic explanation of the types of initial business combinations we may consider and whether

stockholder approval is currently required under Delaware law for each such transaction.

of Transaction

Purchase of assets

Purchase of stock of target not involving

a merger with the company

Merger of target into a subsidiary

of the company

Merger of the company with a target

NASDAQ’s listing rules, stockholder approval would be required for our initial business combination if, for example:

● we issue shares

of Class A common stock that will be equal to or in excess of 20% of the number of shares

of our Class A common stock then outstanding;

● any of our directors,

officers or substantial stockholders (as defined by NASDAQ rules) has a 5% or greater interest

(or such persons collectively have a 10% or greater interest), directly or indirectly, in

the target business or assets to be acquired or otherwise and the present or potential issuance

of common stock could result in an increase in outstanding common shares or voting power

of 5% or more;

● the issuance or

potential issuance of common stock will result in our undergoing a change of control.

Permitted Purchases of our Securities

the event we seek stockholder approval of our business combination and we do not conduct redemptions in connection with our business

combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares or

public warrants in privately negotiated transactions or in the open market either before or after the completion of our initial business

There is no limit on the number of shares our sponsor, directors, officers, advisors or their affiliates may purchase in

such transactions, subject to compliance with applicable law and the rules of NASDAQ.

However, they have no current commitments, plans

or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions.

None of the funds

in the trust account will be used to purchase shares or public warrants in such transactions.

If they engage in such transactions, they

will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if

such purchases are prohibited by Regulation M under the Exchange Act.

Such a purchase may include a contractual acknowledgement that

such stockholder, although still the record holder of our shares is no longer the beneficial owner thereof and therefore agrees not to

exercise its redemption rights.

If our sponsor, directors, officers, advisors or their affiliates purchase shares in privately negotiated

transactions from public stockholders who have already elected to exercise their redemption rights, such selling stockholders would be

required to revoke their prior elections to redeem their shares.

We do not currently anticipate that such purchases, if any, would constitute

a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules

under the Exchange Act;

however, if the purchasers determine at the time of any such purchases that the purchases are subject to such

rules, the purchasers will comply with such rules.

purpose of any such purchases of shares could be to (i) vote such shares in favor of the business combination and thereby increase

the likelihood of obtaining stockholder approval of the business combination or (ii) 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 business combination, where

it appears that such requirement would otherwise not be met.

The purpose of any such purchases of public warrants could be to reduce

the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection

with our initial business combination.

Any such purchases of our securities may result in the completion of our business combination

that may not otherwise have been possible.

addition, if such purchases are made, the public “float” of our common stock may be reduced and the number of beneficial

holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our

securities on a national securities exchange.

sponsor, officers, directors, advisors and/or their affiliates anticipate that they may identify the stockholders with whom our sponsor,

officers, directors, advisors or their affiliates may pursue privately negotiated purchases by either the stockholders contacting us

directly or by our receipt of redemption requests submitted by stockholders following our mailing of proxy materials in connection with

our initial business combination.

To the extent that our sponsor, officers, directors, advisors or their affiliates enter into a private

purchase, they would identify and contact only potential selling stockholders who have expressed their election to redeem their shares

for a pro rata share of the trust account or vote against the business combination.

Our sponsor, officers, directors, advisors or their

affiliates will only purchase shares if such purchases comply with Regulation M under the Exchange Act and the other federal securities

purchases by our sponsor, officers, directors, advisors and/or their affiliates who are affiliated purchasers under Rule 10b-18

under the Exchange Act will only be made to the extent such purchases are able to be made in compliance with Rule 10b-18, which

is a safe harbor from liability for manipulation under Section 9(a)(2) and Rule 10b-5 of the Exchange Act.

has certain technical requirements that must be complied with in order for the safe harbor to be available to the purchaser.

officers, directors, advisors and/or their affiliates will not make purchases of common stock if the purchases would violate Section 9(a)(2)

or Rule 10b-5 of the Exchange Act.

Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange

Act to the extent such purchasers are subject to such reporting requirements.

Redemption Rights for Public Stockholders

upon Completion of our Initial Business Combination

will provide our public stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock upon

the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit

in the trust account as of two business days before the consummation of the initial business combination including interest earned on

the funds held in the trust account and not previously released to us to pay our franchise and income taxes as well as expenses relating

to the administration of the trust account, divided by the number of then outstanding public shares, subject to the limitations described

The amount in the trust account is initially anticipated to be approximately $10.10 per public share.

The per-share amount we

will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay

to the underwriters.

Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed

to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the completion

of our business combination.

The anchor investors will not be entitled to redemption rights with respect to any founder shares held by

them in connection with the completion of our business combination.

Manner of Conducting

will provide our public stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock upon

the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the business

combination or (ii) by means of a tender offer.

The decision as to whether we will seek stockholder approval of a proposed business

combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as

the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under the law or

stock exchange listing requirement.

Asset acquisitions and stock purchases would not typically require stockholder approval while direct

mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or

seek to amend our amended and restated certificate of incorporation would require stockholder approval.

If we structure a business combination

transaction with a target company in a manner that requires stockholder approval, we will not have discretion as to whether to seek a

stockholder vote to approve the proposed business combination.

We intend to conduct redemptions without a stockholder vote pursuant to

the tender offer rules of the SEC unless stockholder approval is required by law or stock exchange listing requirements or we choose

to seek stockholder approval for business or other legal reasons.

So long as we obtain and maintain a listing for our securities on NASDAQ,

we will be required to comply with such rules.

a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant

to our amended and restated certificate of incorporation:

● conduct the redemptions

pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer

tender offers, and

● file tender offer

documents with the SEC before completing our initial business combination that contain substantially

the same financial and other information about the initial business combination and the redemption

rights as is required under Regulation 14A of the Exchange Act, which regulates the

solicitation of proxies.

the public announcement of our business combination, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1

to purchase shares of our Class A common stock in the open market if we elect to redeem our public shares through a tender offer,

to comply with Rule 14e-5 under the Exchange Act.

we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance

with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration

of the tender offer period.

In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified

number of public shares which are not purchased by our sponsor, which number will be based on the requirement that we may not redeem

public shares in an amount that would cause our net tangible assets to be less than $5,000,001 upon completion of our initial business

combination (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.

If public stockholders tender more

shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination.

however, stockholder approval of the transaction is required by law or stock exchange listing requirement, or we decide to obtain stockholder

approval for business or other legal reasons, we will, pursuant to our amended and restated certificate of incorporation:

● conduct the redemptions

in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange

Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules,

● file proxy materials

we intend to expand internationally to regions interested in our middle distillates process, like the United Kingdom, and may enter relationships

with other businesses to expand our operations and to create service networks to support our production and delivery of renewable gasoline.

and Maintaining Relationships with Key Strategic Partners

have established, maintained and managed strategic relationships with Waste Management, InEnTec and EcoStrat, who devote the resources

to promote mutually beneficial business relationships and grow our business.

To expand our business, we will continue to identify and

evaluate development and partnership opportunities and other suitable and scalable business relationships.

and Advancing Technology

as we refocused the use and application of our STG+® technology from using natural gas as a feedstock to using renewable biomass,

MSW and other feedstocks, our R&D team is continuously researching and developing ways to improve our technology and meet our customers’

energy needs.

Using our innovative technology platform and robust intellectual property portfolio, we are well-positioned to continue

making technology advancements over time.

Additionally, we intend to develop or acquire additional intellectual property, such as processes

for sustainable diesel and aviation fuel, as well as other complementary technologies.

Business Combination and Related Transactions

Intermediate was formed in July 2020 in

connection with its acquisition of our demonstration facility, laboratory, office space and intellectual property, including our patented

STG+® process technology from Primus.

In connection with the Closing of the Business Combination, Holdings contributed to OpCo 100%

of the issued and outstanding limited liability company interests of Intermediate in exchange for 22,500,000 Class C OpCo Units and 22,500,000

shares of Class C Common Stock of Verde Clean Fuels.

In connection with the Closing of the Business Combination, we completed a

private placement of 3,200,000 shares of Class A Common Stock for gross proceeds of $32.0 million.

Clean Fuels has retained its “up-C” structure, whereby all of the equity interests in Intermediate are directly held by OpCo

and the Company’s sole assets are its equity interests in OpCo.

up-C structure allows Holdings to retain its equity ownership through Opco, an entity that is classified as a partnership for U.S.

income tax purposes, in the form of Class C Opco Units, and provides potential future tax benefits for Verde Clean Fuels when the holders

of Class C Opco Units ultimately exchange their Class C Opco Units and shares of the Company’s Class C Common Stock for shares

of Class A Common Stock in the Company.

The Company is the sole managing member of Opco.

As such, the Company consolidates Opco,

and the unitholders that hold economic interests directly in Opco are presented as redeemable noncontrolling interests in the Company’s

financial statements.

of Class C Opco Units, other than Verde Clean Fuels, have the right (a “redemption right”), subject to certain limitations,

to exchange all or a portion of its Class C Opco Units and a corresponding number of shares of Class C Common Stock for, at Opco’s

election, (i) shares of Class A Common Stock on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations,

recapitalizations and the like, or (ii) a equivalent amount of cash.

Sponsor and Holdings are each subject to a lock-up period that expires on the earlier of (A) six months following Closing or (B) subsequent

to Closing, (x) if the last sale price of the Class A Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits,

stock dividends, reorganizations, recapitalizations and the like) for any twenty (20) trading days within any thirty (30) consecutive

trading day period commencing at least seventy-five (75) days after Closing or (y) the date on which Verde Clean Fuels completes a liquidation,

merger, capital stock exchange, reorganization or other similar transaction that results in all of Verde Clean Fuels’ stockholders

having the right to exchange their shares of Class A Common Stock for cash, securities or other property.

Facilities and Projects

own a demonstration facility and office space in Hillsborough, New Jersey.

Our first commercial production facility, which we expect

to be operational by the first half of 2025, will be in Maricopa, Arizona.

Intellectual Property and Technology

of December 31, 2022, Intermediate had been issued 28 patents globally, including 8 patents in the U.S., and had 3 pending patent applications

These patents, filed across 14 jurisdictions, including the U.S., protect key aspects of our technology, including the STG+®

process, our proprietary method for converting syngas into gasoline.

We believe our intellectual property rights are important assets

for our success, providing a significant competitive advantage, and we aggressively protect these rights to maintain our competitive

advantage in the market.

patents expire on dates ranging from 2032 through 2039.

We regularly review our development efforts

to assess the existence and patentability of new technology and inventions, and we are prepared to file additional patent applications

when we determine it would benefit our business to do so.

own or have adequate rights to use the intellectual property associated with the STG+® technology.

Approximately 17 patents or patent

applications in our patent portfolio support and protect our ability to produce commodity-grade gasoline from syngas, 14 patents or patent

applications relate to the specific fuel composition produced by our proprietary systems and certain claims of our patents relate potential

future enhancements to our technology.

We manage our patent portfolio to maximize the lifecycle of protecting our intellectual property

and various components and aspects of our system are protected by patents that will expire at staggered times.

Relationships

have selected InEnTec as a strategic partner for the buildout of our first commercial production facility in Maricopa, Arizona, which

we expect to be operational by the first half of 2025.

InEnTec will provide gasification services in connection with the project.

anticipate that InEnTec will be an integral member in the success of our first commercial production facility as production of renewable

gasoline is dependent upon the combination of InEnTec’s existing third-party gasification technology with our STG+® process.

InEnTec is also an important strategic relationship of ours because, as an active product developer, InEnTec has a portfolio of projects

in which we may have an opportunity to participate in the future.

Management, Inc.

Management is a strategic partner for the buildout of our first planned commercial production facility in Maricopa, Arizona.

current plans, Waste Management would provide site and feedstock logistics in connection with the project, which we expect to require

approximately 150,000 tons of feedstock per year for the first phase.

Important Relationships

is a service provider we use to assist us in finding locations for our commercial production facilities, as well as securing volume commitments

once our commercial production facilities are completed and operations have commenced.

E&C International Corporation (“IHI”) is our primary contractor for front-end engineering and design services (“FEED”)

and is expected to perform Engineering, Procurement and Construction (“EPC”) services.

We are a party to agreements with

IHI and/or its subcontractors for the various aspects of FEED and EPC services needs.

Modular Process Systems, LLC (“KMPS”) is an important subcontractor of IHI and provides technical information to IHI and/or

its subcontractors for FEED execution.

for Renewable Gasoline

Energy markets are undergoing dramatic changes

as they shift from fossil fuels to carbon-reduced and carbon-free sources.

A series of technological, economic, regulatory, social and

investor pressures are leading the drive to decarbonize energy and other sectors, such as transportation.

According to the U.S.

Energy Information Administration’s

(the “EIA”) “2022 Annual Energy Outlook” and “U.S.

Energy-Related Carbon Dioxide Emissions, 2020,”

gasoline accounts for more than 20% of the U.S.’s energy-related Carbon Dioxide (“CO2”) emissions and overall, transportation

represents approximately 37% of total U.S.

energy-related CO2 emissions (or 1,903 million tons of CO2).

Within the 37% of total U.S.

energy-related

CO2 emissions that is caused by the transportation sector, in 2019, gasoline represented approximately 56% of the total transportation

emissions (or 1,086 million tons of CO2) and produced over twice as much emissions than diesel, which produced approximately 468 million

tons of CO2) and over four times more emissions than aviation fuel, which produced approximately 261 million tons of CO2).

Uptake on competing

emissions-reduction technologies, such as electric vehicles, is growing, but, according to BloombergNEF, is only expected to reach 24%

of the projected 2035 total vehicle fleet in the U.S.

As a result, the EIA predicts 2035 gasoline demand to be at 92-102% of 2022 levels.

According to the EIA’s “2022 Annual Energy Outlook,” petroleum and natural gas are projected to remain as the most-consumed

source of energy in the U.S.

through 2050, and motor gasoline is projected to be the most commonly-used transportation fuel despite electric

vehicles gaining market share.

Renewable gasoline reduces lifecycle emissions

by over 60% compared to traditional fossil fuel-based gasoline based on GREET-style CI analysis.

Further, according to the U.S.

Environmental

Protection Agency’s (“EPA”) “National Overview:

Facts and Figures on Materials, Wastes and Recycling and Landfill

Methane Outreach Program,” approximately 292 million tons of MSW is generated annually, which consists of about 60% cellulosic material

that can be utilized as feedstock, which can create an estimated 25 billion gallons of renewable gasoline based on the assumption that

one ton of MSW can generate 140 gallons of renewable gasoline using our STG+® process.

Achieving production of 25 billion gallons

of renewable gasoline could meet approximately 19% of estimated 2022 gasoline demand of 132 billion gallons according to the EIA.

gasoline can be utilized within the existing 268 million internal combustion engine (“ICE”) vehicles in the U.S.

without vehicle

modification.

Additionally, according to the National Association of Convenience Stores’ “The US Petroleum Industry Statistics

Definitions,” there are over 145 thousand gas stations nationwide.

Our renewable gasoline will be able to utilize essentially all

of the existing fossil fuel gasoline distribution and retailing infrastructure, making our renewable gasoline a drop-in solution that

does not require a change in consumer behavior.

on the Fuel Institute’s “Life Cycle Analysis Comparison, 2022,” a single conventional ICE vehicle is accountable for

66 tons of CO2 over a 200,000-mile life, which includes 5 tons of CO2 generated from the manufacturing process, 12 tons of CO2 generated

from the production and processing of the oil and gasoline fuel used in the vehicle and 48 tons of CO2 generated from vehicle emissions.

Intermediate estimates that an ICE vehicle utilizing renewable gasoline would be accountable for 28 tons of CO2 over a 200,000-mile life,

which includes five tons of CO2 generated from the manufacturing process, negative 25 tons of CO2 from the production of the renewable

gasoline fuel used in the vehicle and 48 tons of CO2 generated from vehicle emissions.

As a result, an ICE vehicle running on renewable

gasoline is projected to emit approximately 57% less CO2 than the same vehicle running on traditional hydrocarbon-based gasoline.

traditional competitors in the renewable fuel market include companies in the incumbent petroleum-based industry, as well as those in

the emerging renewable fuels industry and others selling carbon credits as a commodity.

Our direct competitors are limited.

only two other companies of which we are aware that also have their own technology to convert syngas into renewable gasoline:

Corporation (“Exxon”) and Haldor Topsoe (“Topsoe”).

Although Exxon’s chemistry process is similar to Intermediate’s,

Exxon has historically focused on larger scale projects and markets.

Topsoe, though larger than Intermediate, only licenses its technology

and processes to others and does not produce renewable liquid hydrocarbons.

believe our technology, scale, and development capabilities are the competitive strengths that differentiate us from our competition.

Utilizing biomass through a gasifier to produce syngas, our proprietary STG+® process can efficiently and economically convert syngas

Intermediate plans to design its facilities to use modular construction and to operate at a scale that makes the use of

renewable feedstocks viable.

We believe that when using biomass as a feedstock, our ability to design facilities on a smaller scale gives

us a competitive advantage, because we are able to deploy equipment to the feedstock rather than being required to build a large central

The economies of scale that may benefit a larger facility we believe are lost with the increased logistics and materials handling

costs that come with the larger supply radius required to feed a large-scale facility.

Intermediate’s process remains in a vapor

phase throughout resulting in a lower piece-count and, therefore, lower capital cost.

& Development

invested over $110 million in developing and patenting its technology and conducted over 10,500 hours of testing at our Hillsborough,

New Jersey demonstration facility.

Since we acquired Primus’ assets, our team has invested approximately $5 million to design the

chemical processes and systems required to produce an acceptable synthesis gas from renewable feedstocks and plans to invest $3 million

to engage a new FEED study, which is expected to take approximately eight months to complete.

Any future FEED studies we intend to commence

we anticipate will focus on the conversion of waste, biomass and other biogenic-feedstocks for future facilities we believe could require

an estimated $100 to $200 million of additional capital expenditures per facility and take 18 to 24 months to construct.

team is also in the process of developing additional process technology to produce middle distillates, including diesel.

Materials and Suppliers

plan to use renewable feedstocks, such as biomass and MSW, as well as natural gas (including synthetic natural gas) and other feedstocks

to produce our renewable gasoline.

We plan on contracting with various suppliers for renewable feedstocks, and intend to work with other

commercial waste companies, agricultural industry participants and landowners to source our renewable feedstocks and maintain an established

supply of product inputs.

Additionally, to lower feedstock costs and maximize the ease of access to sufficient feedstock volumes for

commercial production, we intend to develop future commercial production facilities in locations near biomass and MSW, natural gas or

other feedstock sources.

We do not expect to be dependent on sole source or limited source suppliers for any of our raw materials or

Additionally, we expect to rely on various suppliers for the catalysts we use in our STG+® process.

We do not expect to

be dependent on a sole source for our supply of catalysts.

Capital Resources

of December 31, 2022, we had five full-time employees, engaged six consultants on a part-time basis and one consultant on a full-time

Our workforce is mostly concentrated in the Texas and New Jersey regions.

We have a seasoned leadership team with over 100 years

of cumulative experience in the renewables or a functionally equivalent industry.

Our management team places significant focus and attention

on matters concerning our human capital assets, and is focused on expanding our diversity, enhancing capability development and succession

Accordingly, we regularly review employee development and succession plans for each of our functions to identify and develop

our pipeline of talent.

To date, we have not experienced any work stoppages and consider our relationship with our employees to be in

good standing.

RBOB as our product, we are able to sell to a broad range of potential counterparties including refiners and importers of gasoline, distributors,

blenders, retailers and trading organizations, among others.

We intend to enter into offtake agreements with creditworthy counterparties

with terms that are acceptable to lenders and us as support for our project financing.

We transitioned into the renewable energy industry after applying our STG+® technology to focus on renewable inputs,

expanding our potential customer base beyond the natural gas sector and traditional gasoline consumers in this space.

Our potential customers

will generally include companies obligated to purchase physical volumes of renewable fuel under the RFS program, such as refiners, blenders,

fuel distributors and retailers and marketers, as well as trading shops.

Expanding the application of our STG+® technology will also expand how we can create revenue.

The value of our operations

will include carbon credits derived from converting waste and other bio-feedstocks into a single, finished fuel, which can have significant

For example, certain gasoline produced from renewable feedstock, such as biomass, qualifies under the RFS for the D3 RIN (a carbon

Similarly, we expect that gasoline produced in this fashion will also qualify for various state carbon programs including California’s

We anticipate that we will produce 1.5 RINs per gallon of gasoline, which can be sold alongside each gallon of renewable gasoline

as a separate commodity to customers who can sell the RINs later or sole into forward or futures markets.

However, as with other government programs the use requirements of

the RFS program and similar state-level programs are subject to change, which could materially harm our ability to operate profitably.

Regulatory Environment

Demand for renewable fuel has grown significantly

over the past several years and is expected to continue to grow due in part to federal requirements for cellulosic biofuel volume obligations

through programs such as the RFS program, which was created under the Energy Policy Act of 2005 (the “Energy Act”), which

amended the Clean Air Act (“CAA”) and expanded through the Energy Independence and Security Act of 2007 (the “EISA”).

The EISA requires the use of specific volumes of biofuel in the U.S.

and is aimed at (i) increasing energy security by reducing U.S.

on foreign oil and establishing domestic green fuel related industries and (ii) improving the environment through the reduction of greenhouse

gas (“GHG”) emissions.

Under the RFS program, transportation fuel sold in the U.S.

must contain a certain minimum volume of

renewable fuel.

See “Business — Regulatory Mandates and Governmental Funding” for more information.

However, as stated

above, the RFS program is subject to change, including by modification or repeal by Congressional action or action by the EPA or the EPA

administrator.

Similarly, state-level programs like California’s LCFS are also subject to change.

Social and Environmental Preferences and Investor

The effects of climate change, including extreme

weather events and rising temperature and the increased health and socio-economic stability of at-risk populations, have emphasized the

need to reduce greenhouse gases and move toward reduced carbon energy solutions.

Because of this, environmentally-conscious policies,

initiatives and businesses are growing in value and preference.

ESG investing has accelerated as institutional

investors shift their portfolios away from carbon-intensive assets.

This shift in investor sentiment has caused many large integrated

energy companies to set decarbonization strategies and diversify into different forms of carbon-free and carbon-reduced energy.

Governmental Regulations

Our future operations are subject to stringent

and complex laws and regulations governing environmental protection and human health and safety.

Compliance with such laws and regulations

can be costly, and noncompliance can result in substantial penalties.

Laws and regulations that may have an impact on our business include:

The federal Comprehensive Environmental Response, Compensation and Liability Act (or “CERCLA”) and analogous state laws, impose joint and several liability, without regard to fault or the legality of the original act, on certain classes of persons that contributed to the release of a hazardous substance into the environment.

These persons include the owner and operator of the site where the release occurred, past owners and operators of the site, and companies that disposed of or arranged for the disposal of hazardous substances found at the site.

Responsible parties under CERCLA may be liable for the costs of cleaning up hazardous substances that have been released into the environment and for damages to natural resources.

Additionally, it is not uncommon for third parties to assert claims for personal injury and property damage allegedly caused by the release of hazardous substances or other pollutants into the environment.

The federal Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act (or “RCRA”), is the principal federal statute governing the management of wastes, including the treatment, storage and disposal of hazardous wastes.

RCRA imposes stringent operating requirements and liability for failure to meet such requirements, on a person who is either a generator or transporter of hazardous waste or an owner or operator of a hazardous waste treatment, storage, or disposal facility.

We anticipate that many wastes generated by our manufacturing facility or process will be governed by RCRA.

The federal Water Pollution Control Act (also referred to as the “Clean Water Act”) imposes restrictions and controls on the discharge of pollutants into navigable waters.

These controls have become more stringent over the years, and it is possible that additional restrictions may be imposed in the future.

Permits must be obtained to discharge pollutants into state and federal waters.

The Clean Water Act provides for civil, criminal and administrative penalties for discharges of oil and other pollutants and imposes liability on parties responsible for those discharges for the costs of cleaning up any environmental damage caused by the release and for natural resource damages resulting from the release.

Comparable state statutes impose liability and authorize penalties in the case of an unauthorized discharge of petroleum or its derivatives or other pollutants into state waters.

The CAA and associated state laws and regulations restrict the emission of air pollutants from many sources, including facilities involved in manufacturing biofuels.

New facilities are generally required to obtain permits before operations can commence, and new or existing facilities may be required to incur certain capital expenditures to install air pollution control equipment in connection with obtaining and maintaining operating permits and approvals.

Federal and state regulatory agencies can impose administrative, civil, and criminal penalties for non-compliance with permits or other requirements of the CAA and associated state laws and regulations.

The federal Endangered Species Act, the federal Marine Mammal Protection Act and similar federal and state wildlife protection laws prohibit or restrict activities that could adversely impact protected plant and animal species or habitats.

Construction of facilities could be prohibited or delayed in areas where such protected species or habitats may be located, or mitigation may be required to accommodate such activities.

The IR Act provides for, among other things, a new clean hydrogen production tax credit, a new credit for sustainable aviation fuel, credits for the production and purchase of electric vehicles, expanding eligibility for and increasing the value of the carbon capture and sequestration credit, extending the biodiesel, renewable diesel and alternative fuels tax credit, funding biofuel refueling infrastructure and additional funding for working lands conservation programs for farmers.

The IR Act could have many potential impacts on our business that we are continuing to evaluate, including new opportunities to access production tax credits, carbon sequestration credits, and other benefits, which could result in changes in the configuration of the plant, and could slightly delay commercial operation.

We may be required to obtain certain permits to

construct and operate our facilities, including those related to air emissions, solid and hazardous waste management and water quality.

These permits can be difficult and expensive to obtain and maintain.

Our ability to obtain these permits could be impacted by opposition

from various stakeholders.

Once operational, our facilities will also need to maintain compliance with these permits.

In additional to compliance with environmental

regulations, we expect that our future operations will be subject to federal RFS program regulations.

The EPA administers the RFS program

with volume requirements for several categories of renewable fuels.

The EPA calculates a blending standard annually based on estimates

of gasoline usage from the EIA.

Different quotas and blending requirements are determined for cellulosic biofuels, biomass-based diesel,

advanced biofuels and total renewable fuel.

RINs are used to ensure that the prescribed levels of blending are met.

The Energy Act’s

RFS regulations establish rules for fuel supplied and administer the RIN system for compliance, trading credits and rules for waivers.

We anticipate that our renewable gasoline and other future products will benefit from the RFS program.

However, as stated above, the

use requirements of the RFS program or state programs could change, which may impact our products and harm our ability to operate profitably.

See “Business— Regulatory Mandates and Government Funding” for more information.

Mandates and Government Funding

increases in the federal requirement of cellulosic biofuel volume obligations position us to benefit as a producer of renewable gasoline.

RFS program was created under the Energy Act, which amended the CAA.

The EISA further amended the CAA by expanding the RFS program.

EPA implements the RFS program under the guidance of the U.S.

Department of Agriculture and the Department of Energy.

RFS program is a federal policy that requires a certain volume of renewable fuel to replace or reduce the quantity of petroleum-based

transportation fuel, heating oil or aviation fuel.

The four renewable fuel categories under the RFS are:

● biomass-based

renewable fuel.

believe our renewable gasoline will qualify under the cellulosic biofuel category, which qualifies for D3 RINs.

2007 enactment of EISA significantly increased the size of the program and included key changes, including:

the long-term goals to 36 billion gallons of renewable fuel;

yearly volume requirements out to 2022;

explicit definitions for renewable fuels to qualify (e.g., renewable biomass, GHG emissions);

grandfathering allowances for volumes from certain existing facilities;

specific types of waiver authorities.

CAA provides the EPA with the authority to adjust cellulosic, advanced and total volumes set by Congress as part of the annual rule process.

statute also contains a general waiver authority that allows the Administrator to waive the RFS volumes, in whole or in part, based on

a determination that implementation of the program is causing severe economic or environmental harm, or based on inadequate domestic

a fuel to qualify as a renewable fuel under the RFS program, the EPA must determine that the fuel qualifies under the statute and regulations.

Among other requirements, fuels must achieve a reduction in GHG emissions as compared to a 2005 petroleum baseline.

EPA has approved fuel pathways under the RFS program under all four categories of renewable fuel.

Advanced pathways already approved

include ethanol made from sugarcane, jet fuel made from camelina, cellulosic ethanol made from corn stover, compressed natural gas from

municipal wastewater treatment facility digesters and others.

Additional requirements of the RFS program include:

● biomass-based

diesel must meet a 50% lifecycle GHG reduction;

biofuel must be produced from cellulose, hemicellulose or lignin and must meet a 60% lifecycle

GHG reduction;

biofuel can be produced from qualifying renewable biomass (except corn starch) and must meet

a 50% GHG reduction;

(or conventional) fuel typically refers to ethanol derived from corn starch and must meet

a 20% lifecycle GHG reduction threshold.

GHG reduction comparisons are based on a 2005 petroleum baseline as mandated by EISA.

Biofuel facilities (domestic and foreign) that

were producing fuel prior to enactment of EISA in 2007 are “grandfathered” under the statute, meaning these facilities are

not required to meet the GHG reductions.

EPA continues to review and approve new pathways, including for fuels made with advanced technologies or with new feedstocks.

biofuels, such as our renewable gasoline, are similar enough to gasoline or diesel that they do not have to be blended, but can be simply

“dropped in” to existing petroleum-based fuels.

These drop-in biofuels directly replace petroleum-based fuels and hold particular

promise for the future.

Parties under the RFS program are refiners or importers of gasoline or diesel fuel.

Compliance is achieved by blending renewable fuels

into transportation fuel, or by obtaining credits, RINs, to meet an EPA-specified Renewable Volume Obligation (“RVO”).

EPA calculates and establishes RVOs every year through rulemaking, based on the CAA volume requirements and projections of gasoline and

diesel production for the coming year.

The standards are converted into a percentage and Obligated Parties must demonstrate compliance

fuel type is assigned a “D-code” — a code that identifies the renewable fuel type — based on the feedstock used,

fuel type produced, energy inputs and GHG reduction thresholds, among other requirements.

The four categories of renewable fuel have

the following assigned D-codes:

biofuel is assigned a D-code of 3 (e.g., cellulosic biofuel) or D-code of 7 (cellulosic diesel);

● Biomass-based

diesel is assigned a D-code of 4;

biofuel is assigned a D-code of 5;

fuel (non-advanced/conventional biofuel) is assigned a D-code of 6 (grandfathered fuels are

also assigned a D-code of 6);

production of our renewable gasoline is expected to qualify for a D-code of 3.

Parties use RINs to demonstrate compliance with the standard.

These parties must obtain sufficient RINs for each category in order to

demonstrate compliance with the annual standard.

Some of the regulations regarding RINs include the following:

are generated when a producer makes a gallon of renewable fuel.

the end of the compliance year, Obligated Parties use RINs to demonstrate compliance.

can be traded between parties.

Parties can buy gallons of renewable fuel with RINs attached.

They can also buy RINs on the

Parties can carry over unused RINs between compliance years.

They may carry a compliance

deficit into the next year.

This deficit must be made up the following year.

The RFS program’s four renewable fuel standards

are nested within each other.

This means the fuel with a higher GHG reduction threshold can be used to meet the standards for a lower

GHG reduction threshold.

For example, fuels or RINs for advanced biofuel (i.e., cellulosic, biodiesel or sugarcane ethanol) can be used

to meet the total renewable fuel standards (i.e., corn ethanol).

For cellulosic standards, an additional flexibility

Cellulosic waiver credits (“CWCs”) are offered by the Energy Act at a price determined by a formula in the statute.

Obligated Parties have the option of purchasing CWCs plus an advanced RIN in lieu of blending cellulosic biofuel or obtaining a cellulosic

On November 15, 2021, the U.S.

Infrastructure

Investment and JOBS Act was signed into law that includes $65 billion in funding for power and grid investments.

This includes investments

in grid reliability and resiliency as well as clean energy technologies such as carbon capture, hydrogen and advanced nuclear, including

small modular reactors.

Additionally, on December 8, 2021, President Biden signed an executive order mandating all electricity procured

by the government be 100% carbon pollution-free by 2030, including at least 50% from around-the-clock dispatchable generation sources.

The order also requires that federally owned buildings produce no net emissions by 2045 and that each federal agency achieve 100% zero-emission

vehicle acquisitions by 2035.

At the international level, the United States

joined the international community at the 21st Conference of the Parties of the United Nations Framework Convention on Climate Change

in Paris, France, which resulted in an agreement intended to nationally determine their contributions and set GHG emission reduction goals

every five years beginning in 2020.

In November 2019, plans were formally announced for the U.S.

to withdraw from the Paris Agreement

with an effective exit date in November 2020.

In February 2021, the current administration announced reentry of the U.S.

into the Paris

Agreement along with a new “nationally determined contribution” for U.S.

GHG emissions that would achieve emissions reductions

of at least 50% relative to 2005 levels by 2030.

In addition, in 2021, President Biden publicly announced the Global Methane Pledge, a

pact that aims to reduce global methane emissions at least 30% below 2020 levels by 2030, including “all feasible reductions”

in the energy sector.

Since its formal launch at the United Nations Climate Change Conference, over 100 countries have joined the pledge.

Recent Developments

The Business Combination closed on February 15,

At the effective time of the Business Combination, among other things, each share of Class B common stock of CENAQ automatically

converted into shares of Class A Common Stock on a one for one basis, resulting in the issuance of 825,000 shares of Class A Common Stock

in the aggregate.

In connection with the Closing of the business combination, we completed a private placement of 3,200,000 shares of

Class A Common Stock for gross proceeds of $32.0 million.

As of the Closing Date and following the completion

of the Business Combination, the Company had 9,358,620 shares of Class A Common Stock issued and outstanding held of record by approximately

28 holders, 22,500,000 shares of Class C Common Stock issued and outstanding held of record by 1 holder, and 15,412,479 warrants (consisting

of (i) 12,937,479 shares underlying CENAQ’s public warrants and (ii) 2,475,000 shares underlying CENAQ’s private placement

warrants) outstanding held of record by approximately 2 holders.

In connection with the consummation of the Business

Combination, CENAQ changed its name to “Verde Clean Fuels, Inc.” Our Common Stock is now listed on the Nasdaq Capital Market

(“Nasdaq”) under the symbol “VGAS” and public warrants to purchase the Common Stock at an exercise price of $11.50

per share are listed on the Nasdaq under the symbol “VGASW.”

Corporate Information

We were originally known as CENAQ Energy Corp.

On February 15, 2023, Intermediate, CENAQ and OpCo consummated the Business Combination, following the approval at the special meeting

of the stockholders of CENAQ held on January 4, 2023.

In connection with the Business Combination, we changed our name from CENAQ Energy

to Verde Clean Fuels, Inc.

Our principal executive offices are located at

600 Travis Street, Suite 5050, Houston, Texas 77002.

Our website is located at www.verdecleanfuels.com.

We furnish or file with the SEC our Annual Reports

on Form 10-K, our Quarterly Reports on Form 10-Q, and our Current Reports on Form 8-K.

We make these documents available free of charge

at www.verdecleanfuels.com under the “Investors” tab as soon as reasonably practicable after they are filed or furnished

with the SEC.

we seek stockholder approval of our initial business combination, we will distribute proxy materials and, in connection therewith, provide

our public stockholders with the redemption rights described above upon completion of the initial business combination.

If we seek stockholder approval, we will complete

our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the business

A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock

of the company representing a majority of the voting power of all outstanding shares of capital stock of the company entitled to vote

at such meeting.

Our sponsor will count toward this quorum and has agreed to vote its founder shares and any public shares purchased during

or after the IPO, and the anchor investors have agreed to vote any founder shares held by them, in favor of our initial business combination.

For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the

approval of our initial business combination once a quorum is obtained.

We intend to give approximately 30 days (but not less than

10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve

our initial business combination.

These quorum and voting thresholds, and the voting agreement of our sponsor, and the voting agreements

of our initial shareholders and the anchor investors, may make it more likely that we will consummate our initial business combination.

Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction.

The anchor investors are not required to vote any of their public shares in favor of our initial business combination or for or against

any other matter presented for a shareholder vote.

amended and restated certificate of incorporation provides that in no event will we redeem our public shares in an amount that would

cause our net tangible assets to be less than $5,000,001 (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.

For example, the proposed business combination may require:

(i) cash consideration to be paid to the target or its owners, (ii) cash

to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy

other conditions in accordance with the terms of the proposed business combination.

In the event the aggregate cash consideration we

would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required

to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to

us, we will not complete the business combination or redeem any shares, and all shares of Class A common stock submitted for redemption

will be returned to the holders thereof.

Limitation on Redemption

upon Completion of our Initial Business Combination if we Seek Stockholder Approval

Notwithstanding

the foregoing, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with

our business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation provides that a public

stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as

a “group” (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with

respect to more than an aggregate of 15% of the shares sold in the IPO (the “Excess Shares”).

We believe this restriction

will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to

exercise their redemption rights against a proposed business combination as a means to force us or our management to purchase their shares

at a significant premium to the then-current market price or on other undesirable terms.

Absent this provision, a public stockholder

holding more than an aggregate of 15% of the shares sold in the IPO could threaten to exercise its redemption rights if such holder’s

shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms.

our stockholders’ ability to redeem no more than 15% of the shares sold in the IPO, we believe we will limit the ability of a small

group of stockholders to unreasonably attempt to block our ability to complete our business combination, particularly in connection with

a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash.

However, our amended and restated certificate of incorporation will not restrict our stockholders’ ability to vote all of their

shares (including Excess Shares) for or against our business combination.

Tendering Stock Certificates

in Connection with a Tender Offer or Redemption Rights

may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares

in “street name,” to either tender their certificates to our transfer agent before the date set forth in the tender offer

documents, or up to two business days before the vote on the proposal to approve the business combination in the event we distribute

proxy materials, or to deliver their shares to the transfer agent electronically using the Depository Trust Company’s DWAC (Deposit/Withdrawal

At Custodian) System, at the holder’s option.

The tender offer or proxy materials, as applicable, that we will furnish to holders

of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to

satisfy such delivery requirements.

Accordingly, a public stockholder would have from the time we send out our tender offer materials

until the close of the tender offer period, or up to two days before the vote on the business combination if we distribute proxy materials,

as applicable, to tender its shares if it wishes to seek to exercise its redemption rights.

Given the relatively short exercise period,

it is advisable for stockholders to use electronic delivery of their public shares.

is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through

the DWAC System.

The transfer agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not

to pass this cost on to the redeeming holder.

However, this fee would be incurred regardless of whether or not we require holders seeking

to exercise redemption rights to tender their shares.

The need to deliver shares is a requirement of exercising redemption rights regardless

of the timing of when such delivery must be effectuated.

foregoing is different from the procedures used by many blank check companies.

In order to perfect redemption rights in connection with

their business combinations, many blank check companies would distribute proxy materials for the stockholders’ vote on an initial

business combination, and a holder could simply vote against a proposed business combination and check a box on the proxy card indicating

such holder was seeking to exercise his or her redemption rights.

After the business combination was approved, the company would contact

such stockholder to arrange for him or her to deliver his or her certificate to verify ownership.

As a result, the stockholder then had

an “option window” after the completion of the business combination during which he or she could monitor the price of the

company’s stock in the market.

If the price rose above the redemption price, he or she could sell his or her shares in the open

market before actually delivering his or her shares to the company for cancellation.

As a result, the redemption rights, to which stockholders

were aware they needed to commit before the stockholder meeting, would become “option” rights surviving past the completion

of the business combination until the redeeming holder delivered its certificate.

The requirement for physical or electronic delivery

before the meeting ensures that a redeeming holder’s election to redeem is irrevocable once the business combination is approved.

request to redeem such shares, once made, may be withdrawn at any time up to the date set forth in the tender offer materials or the

date of the stockholder meeting set forth in our proxy materials, as applicable.

Furthermore, if a holder of a public share delivered

its certificate in connection with an election of redemption rights and subsequently decides before the applicable date not to elect

to exercise such rights, such holder may simply request that the transfer agent return the certificate (physically or electronically).

It is anticipated that the funds to be distributed to holders of our public shares electing to redeem their shares will be distributed

promptly after the completion of our business combination.

our initial business combination is not approved or completed for any reason, then our public stockholders who elected to exercise their

redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account.

In such case,

we will promptly return any certificates delivered by public holders who elected to redeem their shares.

our initial proposed business combination is not completed, we may continue to try to complete a business combination with a different

target until 12 months (or until 18 months if we extend the period of time to consummate our initial business combination in accordance

with the terms described in the IPO’s registration statement) from the closing of the IPO.

Redemption of Public

Shares and Liquidation if no Initial Business Combination

amended and restated certificate of incorporation provides that we will have only 12 months from the closing of the IPO to complete our

initial business combination.

If we anticipate that we may not be able to consummate our initial business combination within 12 months,

we may, but are not obligated to, extend the period of time to consummate a business combination two times by an additional three months

each time (for a total of up to 18 months to complete a business combination);

provided that our Sponsor, as defined below (or its designees)

must deposit into the trust account funds equal to one percent (1%) of the gross proceeds of the offering (including such proceeds from

the exercise of the underwriters’ over-allotment option) for each 3-month extension of the time period to complete our initial

business combination (the “Additional Funds”), in exchange for a non-interest bearing, unsecured promissory note.

if we filed a proxy statement, registration statement or similar filing for an initial business combination within the initial 12-month

period, we may extend the period of time to consummate a business combination by three months (or up to 15 months to complete a business

combination) without depositing the Additional Funds.

If we are unable to complete our business combination within such prescribed time

period, we will:

(i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but

not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount

then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to

us to pay our franchise and income taxes as well as expenses relating to the administration of the trust account (less up to $100,000

of interest released to us to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will

completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions,

if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval

of our remaining stockholders and our Board, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide

for claims of creditors and the requirements of other applicable law.

There will be no redemption rights or liquidating distributions

with respect to our warrants, which will expire worthless if we fail to complete our business combination within the prescribed time

of our founder shares will not be entitled to rights to liquidating distributions from the trust account with respect to the founder

shares held by them if we fail to complete our initial business combination within 12 months (or up to 18 months, as applicable) from

the closing of the IPO.

However, if our sponsor, officers, directors, or the anchor investors acquire public shares in or after the IPO,

they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our

initial business combination within the allotted 12-month time period (or up to 18-month time period, as applicable).

Our sponsor, officers

and directors have agreed, pursuant to a letter agreement with us, that they will not propose any amendment to our amended and restated

certificate of incorporation that would 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 within 18 months if we extend the period of time to consummate our

initial business combination in accordance with the terms described in the IPO’s registration statement) from the closing of the

IPO, 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 including

interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes as well

as expenses relating to the administration of the trust account divided by the number of then outstanding public shares.

may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 upon completion of

our initial business combination (so that we are not subject to the SEC’s “penny stock” rules).

If this optional redemption

right is exercised with respect to an excessive number of public shares such that we cannot satisfy the net tangible asset requirement

(described above) we would not proceed with the amendment or the related redemption of our public shares.

All costs and expenses

associated with implementing our plan of dissolution, as well as payments to any creditors, have been funded from amounts remaining out

of the approximately $600,000 of proceeds held outside the trust account, although we cannot assure you that there will be sufficient

funds for such purpose.

However, if those funds are not sufficient to cover the costs and expenses associated with implementing our plan

of dissolution, to the extent that there is any interest accrued in the trust account not required to pay franchise and income taxes

as well as expenses relating to the administration of the trust account on interest income earned on the trust account balance, we may

request the trustee to release to us an amount of up to $100,000 of such accrued interest to pay those costs and expenses.

28, 2022, we have not requested the trustee to release any funds.

we were to expend all of the net proceeds of the IPO and the sale of the private placement warrants, other than the proceeds deposited

in the trust account, and without taking into account interest, if any, earned on the trust account, the per-share redemption amount

received by stockholders upon our dissolution would be approximately $10.10.

proceeds deposited in the trust account could, however, become subject to the claims of our creditors which would have higher priority

than the claims of our public stockholders.

We cannot assure you that the actual per-share redemption amount received by stockholders

will not be substantially less than $10.10.

Under Section 281(b) of the DGCL, our plan of dissolution must provide for all claims

against us to be paid in full or make provision for payments to be made in full, as applicable, if there are sufficient assets.

claims must be paid or provided for before we make any distribution of our remaining assets to our stockholders.

While we intend to pay

such amounts, if any, we cannot assure you that we will have funds sufficient to pay or provide for all creditors’ claims.

we will seek to have all vendors, service providers (other than our independent auditors), prospective target businesses or other entities

with which we do business execute agreements with us waiving any right, title, interest and claim of any kind in or to any monies held

in the trust account for the benefit of our public stockholders, there is no guarantee that they will execute such agreements or even

if they execute such agreements that they would be prevented from bringing claims against the trust account including but not limited

to fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability

of the waiver, in each case in order to gain an advantage with respect to a claim against our assets, including the funds held in the

trust account.

If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management

will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed

a waiver if management believes that such third party’s engagement would be significantly more beneficial to us than any alternative.

Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party

consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants

that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver.

addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising

out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason.

has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent auditors) for services

rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement,

reduce the amount of funds in the trust account to below (i) $10.10 per public share or (ii) such lesser amount per public share

held in the trust account as of the date of the liquidation of the trust account, due to reductions in value of the trust assets, in

each case net of the amount of interest which may be withdrawn to pay taxes as well as expenses relating to the administration of the

trust account, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account

and except as to any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under

the Securities Act.

If an executed waiver is deemed to be unenforceable against a third party, then our sponsor will not be responsible

to the extent of any liability for such third party claims Our sponsor does not have sufficient funds to satisfy its indemnity obligations

and our sponsor’s only assets are securities of our company.

We have not asked our sponsor to reserve for such indemnification

Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations.

As a result, if any such claims

were successfully made against the trust account, the funds available for our initial business combination and redemptions could be reduced

to less than $10.10 per public share.

In such event, we may not be able to complete our initial business combination, and you would receive

such lesser amount per share in connection with any redemption of your public shares.

None of our officers will indemnify us for claims

by third parties including, without limitation, claims by vendors and prospective target businesses.

the proceeds in the trust account are reduced below (i) $10.10 per public share or (ii) such lesser amount per public share held

in the trust account as of the date of the liquidation of the trust account, due to reductions in value of the trust assets, in each

case net of the amount of interest which may be withdrawn to pay taxes as well as expenses relating to the administration of the trust

account, and our sponsor asserts that it is unable to satisfy its indemnification obligations or that it has no indemnification obligations

related to a particular claim, our independent directors would determine whether to take legal action against our sponsor to enforce

its indemnification obligations.

While we currently expect that our independent directors would take legal action on our behalf against

our sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business

judgment may choose not to do so if, for example, the cost of such legal action is deemed by the independent directors to be too high

relative to the amount recoverable or if the independent directors determine that a favorable outcome is not likely.

We have not asked

our sponsor to reserve for such indemnification obligations and we cannot assure you that our sponsor would be able to satisfy those

Accordingly, we cannot assure you that due to claims of creditors the actual value of the per-share redemption price will

not be less than $10.10 per public share.

will seek to reduce the possibility that our sponsor will have to indemnify the trust account due to claims of creditors by

endeavoring to have all vendors, service providers (other than our independent auditors), prospective target businesses or other

entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to

monies held in the trust account.

Our sponsor will also not be liable as to any claims under our indemnity of the underwriters of

the IPO against certain liabilities, including liabilities under the Securities Act.

We will have access to up to approximately

$600,000 from the proceeds of the IPO with which to pay any such potential claims (including costs and expenses incurred in

connection with our liquidation, currently estimated to be no more than approximately $100,000).

If we liquidate, and it is

subsequently determined that the reserve for claims and liabilities is insufficient, stockholders who received funds from our trust

account could be liable for claims made by creditors.

If our offering expenses exceeded our estimate of $900,000, we would fund such

excess with funds from the funds not to be held in the trust account.

In such case, the amount of funds we intend to be held outside

the trust account would decrease by a corresponding amount.

Conversely, since the offering expenses of $576,438 are

less than our estimate of $900,000, the amount of funds we intend to be held outside the trust account will increase by a

corresponding amount.

the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by

them in a dissolution.

The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public

shares in the event we do not complete our business combination within 12 months (or within 18 months if we extend the period of time

to consummate our initial business combination in accordance with the terms described in the IPO’s registration statement) from

the closing of the IPO may be considered a liquidating distribution under Delaware law.

If the corporation complies with certain procedures

set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including

a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation

may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders,

any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata

share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third

anniversary of the dissolution.

if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event

we do not complete our business combination within 12 months (or within 18 months if we extend the period of time to consummate our initial

business combination in accordance with the terms described in the IPO’s registration statement) from the closing of the IPO, is

not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant

to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption

distribution, instead of three years, as in the case of a liquidating distribution.

If we are unable to complete our business combination

within 12 months (or within 18 months if we extend the period of time to consummate our initial business combination in accordance with

the terms described in the IPO’s registration statement) from the closing of the IPO, we will:

(i) cease all operations except

for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the

public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest

earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes as well as expenses

relating to the administration of the trust account (less up to $100,000 of interest released to us to pay dissolution expenses), divided

by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders

(including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as

reasonably possible following such redemption, subject to the approval of our remaining stockholders and our Board, dissolve and liquidate,

subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable

Accordingly, it is our intention to redeem our public shares as soon as reasonably possible following our 24 th month

and, therefore, we do not intend to comply with those procedures.

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 well beyond the third

anniversary of such date.

we will not be complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to

us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against

us within the subsequent 10 years.

However, because we are a blank check company, rather than an operating company, and our operations

will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors

(such as lawyers, investment bankers, etc.) or prospective target businesses.

As described above, pursuant to the obligation contained

in our underwriting agreement, we will seek to have all vendors, service providers (other than our independent auditors), prospective

target businesses or other entities with which we do business execute agreements with us waiving any right, title, interest or claim

of any kind in or to any monies held in the trust account.

As a result of this obligation, the claims that could be made against us are

significantly limited and the likelihood that any claim that would result in any liability extending to the trust account is remote.

Further, our sponsor may be liable only to the extent necessary to ensure that the amounts in the trust account are not reduced below

(i) $10.10 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation

of the trust account, due to reductions in value of the trust assets, in each case net of the amount of interest withdrawn to pay taxes

as well as expenses relating to the administration of the trust account and will not be liable as to any claims under our indemnity of

the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act.

If an executed waiver is deemed

to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims.

we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the

trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of

third parties with priority over the claims of our stockholders.

To the extent any bankruptcy claims deplete the trust account, we cannot

assure you we will be able to return $10.10 per share to our public stockholders.

Additionally, if we file a bankruptcy petition or an

involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed

under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.”

As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders.

Furthermore, our Board may be

viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, thereby exposing itself and our company

to claims of punitive damages, by paying public stockholders from the trust account before addressing the claims of creditors.

assure you that claims will not be brought against us for these reasons.

public stockholders will be entitled to receive funds from the trust account only (i) in the event of the redemption of our public

shares if we do not complete our business combination within 12 months (or within 18 months if we extend the period of time to consummate

our initial business combination in accordance with the terms described in the IPO’s registration statement) from the closing of

the IPO, subject to applicable law, (ii) in connection with a stockholder vote to approve an 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 have not

consummated an initial business combination within 12 months (or within 18 months if we extend the period of time to consummate our initial

business combination in accordance with the terms described in the IPO’s registration statement) from the closing of the IPO or

(b) relating to any other provisions relating to stockholders’ rights or pre-initial business combination activity, or (iii) our

completion of an initial business combination, and then only in connection with those shares of our common stock that such stockholder

properly elected to redeem, subject to the limitations.

In no other circumstances will a stockholder have any right or interest of any

kind to or in the trust account.

In the event we seek stockholder approval in connection with our initial business combination, a stockholder’s

voting in connection with the business combination alone will not result in a stockholder’s redeeming its shares to us for an applicable

pro rata share of the trust account.

Such stockholder must have also exercised its redemption rights as described above.

identifying, evaluating and selecting a target business for our business combination, we may encounter intense competition from other

entities having a business objective similar to ours, including other blank check companies, private equity groups and leveraged buyout

funds, and operating businesses seeking strategic acquisitions.

Many of these entities are well established and have extensive experience

identifying and effecting business combinations directly or through affiliates.

Moreover, many of these competitors possess greater financial,

technical, human and other resources than we do.

Our ability to acquire larger target businesses will be limited by our available financial

This inherent limitation gives others an advantage in pursuing the acquisition of a target business.

Furthermore, our obligation

to pay cash in connection with our public stockholders who exercise their redemption rights may reduce the resources available to us

for our initial business combination and our outstanding warrants, and the future dilution they potentially represent, may not be viewed

favorably by certain target businesses.

Either of these factors may place us at a competitive disadvantage in successfully negotiating

an initial business combination.

Our shared executive offices are located at 4550 Post Oak Place Dr.,

Suite 300, Houston, Texas 77027, and our telephone number is (713) 820-6300.

We consider our current office space adequate for our current

We currently have two officers.

We have no paid

Members of our management team are not obligated to devote any specific number of hours to our matters, but they intend to

devote as much of their time as they deem necessary to our affairs until we have completed our initial business combination.

of time that any such person will devote in any time period will vary based on whether a target business has been selected for our initial

business combination and the current stage of the business combination process.

Periodic Reporting and Financial Information

will register our units, Class A common stock and warrants under the Exchange Act and have reporting obligations, including the

requirement that we file annual, quarterly and current reports with the SEC.

In accordance with the requirements of the Exchange Act,

our annual reports will contain financial statements audited and reported on by our independent registered public accountants.

will provide stockholders with audited financial statements of the prospective target business as part of the tender offer materials

or proxy solicitation materials sent to stockholders to assist them in assessing the target business.

In all likelihood, these financial

statements will need to be prepared in accordance with GAAP.

We cannot assure you that any particular target business selected by us

as a potential acquisition candidate will have financial statements prepared in accordance with GAAP or that the potential target business

will be able to prepare its financial statements in accordance with GAAP.

To the extent that this requirement cannot be met, we may not

be able to acquire the proposed target business.

While this may limit the pool of potential acquisition candidates, we do not believe

that this limitation will be material.

will be required to evaluate our internal control procedures for the fiscal year ending December 31, 2022 as required by the Sarbanes-Oxley

Only if we are deemed to be a large accelerated filer or an accelerated filer will we be required to have our internal control procedures

A target company may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of their internal

The development of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase

the time and costs necessary to complete any such acquisition.

Legal Proceedings

is no material litigation, arbitration or governmental proceeding currently pending against us or any members of our management team

in their capacity as such.

In addition, corporate governance information, including our corporate governance guidelines and code of ethics, is also

available on our investor relations website under the heading “Governance Documents.” Information on our website is

not incorporated by reference into this Annual Report on Form 10-K or any of our other filings with the SEC.

The SEC also maintains

an Internet website that contains reports, proxy statements and other information about issuers, like us, that file electronically with

The address of that website is www.sec.gov.

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.

What changed 10-K

Item 1. Business