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Item 2. Management’s Discussion and Analysis

2023-05-15 compared with 2022-11-14 · 262 added, 212 removed, 137 unchanged (78% of the section changed)

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The following discussion and analysis of the Company’s

financial condition and results of operations should be read in conjunction with the unaudited condensed financial statements and the

notes thereto contained elsewhere in this report.

Certain information contained in the discussion and analysis set forth below includes

forward-looking statements that involve risks and uncertainties.

financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements

and the notes thereto contained elsewhere in this Report.

Certain information contained in the discussion and analysis set forth below

includes forward-looking statements that involve risks and uncertainties.

Cautionary Note Regarding Forward-Looking Statements

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Public Offering of 25,000,000 units (each, a “Unit” and with respect to the shares of Class A common stock included in the

Units sold, the “Public Shares”), including 3,000,000 Units sold upon the partial exercise of the underwriter’s over-allotment

Units sold, the “Public Shares”), including 3,000,000 Units sold upon the partial exercise of the underwriters’ over-allotment

option, at a purchase price of $10.00 per Unit, generating gross proceeds of $250,000,000.

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Account”) located in the United States at J.P.

Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting

as trustee, which may be invested only in U.S.

government securities, within the meaning set forth in Section 2(a)(16) of the Investment

Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment

company that holds itself out as a money market fund selected by us meeting the conditions of paragraphs (d)(2), (d)(3) and (d)(4) of

Rule 2a-7 of the Investment Company Act, as determined by us, until the earlier of:

(i) the completion of an Initial Business Combination

and (ii) the distribution of the Trust Account, as described below.

Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company (“Continental”)

acting as trustee, which were initially invested only in U.S.

government securities, within the meaning set forth in Section 2(a)(16)

of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in

any open-ended investment company that holds itself out as a money market fund selected by us meeting the conditions of paragraphs (d)(2),

(d)(3) and (d)(4) of Rule 2a-7 of the Investment Company Act, as determined by us.

To mitigate the risk of us being deemed to be an unregistered

investment company (including under the subjective test of Section 3(a)(1)(A) of the Investment Company Act) and thus be subject to regulation

under the Investment Company Act, upon the 24-month anniversary of the effective date of the registration statement for the Initial Public

Offering, we instructed Continental, the trustee with respect to the Trust Account, to liquidate any U.S.

government treasury obligations

or money market funds held in the Trust Account and thereafter to hold all funds in the Trust Account in an interest bearing demand deposit

account at a U.S.

bank until the earlier of the consummation of the Initial Business Combination or the distribution of the Trust Account.

On March 8, 2022, at a special meeting of our

stockholders, our stockholders approved the extension of our term to complete our Initial Business Combination from March 16, 2022 to

stockholders, our stockholders approved the extension of our term to complete the Initial Business Combination from March 16, 2022 to

September 30, 2022 (the “First Extension”).

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of $4,424,015 ($0.20 for each Public Share that was not redeemed in connection with the First Extension) (the “First Extension Loan”).

The proceeds of the First Extension Loan were deposited in the Trust Account on March 9, 2022.

The First Extension Loan will not

bear interest and will be repayable by us to the Sponsor or its designees upon consummation of an Initial Business Combination.

In connection

with the stockholder vote to approve the First Extension, 2,879,927 Public Shares were redeemed at $10.00 a share, resulting in a reduction

of $28,799,270 in the amount held in the Trust Account.

As a result of the approval of the First Extension and the First Extension Loan,

the amount in the Trust Account was increased to approximately $10.20 per Public Share.

The proceeds of the First Extension Loan were deposited into the Trust Account on March 9, 2022.

In connection with the stockholder

vote to approve the First Extension, 2,879,927 Public Shares were redeemed at $10.00 a share, resulting in a reduction of $28,799,270

in the amount held in the Trust Account.

On September 27, 2022, at a special meeting of

our stockholders, our stockholders approved the extension of our term to complete our Initial Business Combination from September 30,

our stockholders, our stockholders approved the extension of our term to complete the Initial Business Combination from September 30,

2022 to March 16, 2023 (the “Second Extension”).

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amount of $976,832 ($0.33 for each Public Share that was not redeemed in connection with the Second Extension) (the “Second Extension

The proceeds of the Second Extension Loan were deposited in the Trust Account on September 30, 2022.

The Second Extension

Loan will not bear interest and will be repayable by us to the Sponsor or its designees upon consummation of an Initial Business Combination.

In connection with the stockholder vote to approve the Second Extension, 19,159,975 Public Shares were redeemed at approximately $10.23

a share, resulting in a reduction of $196,121,351 in the amount held in the Trust Account.

As a result of the approval of the Second Extension

and the Second Extension Loan, the amount in the Trust Account was increased to approximately $10.53 per Public Share.

We have until March 16, 2023 or a later date approved

by our stockholders in accordance with the Amended and Restated Certificate of Incorporation, to consummate an Initial Business Combination

(the “Combination Period”).

If we are unable to complete an Initial Business Combination by the end of the Combination 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 taxes (less up

to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely

extinguish public 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 of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) 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 an Initial Business Combination within

the Combination Period.

The proceeds of the Second Extension Loan were deposited into the Trust Account on September 30, 2022.

In connection

with the stockholder vote to approve the Second Extension, 19,159,975 Public Shares were redeemed at approximately $10.24 a share, resulting

in a reduction of $196,121,351 in the amount held in the Trust Account.

On March 6, 2023, we issued 5,000,000 shares of

Class A common stock to the Sponsor upon the conversion of 5,000,000 shares of Class B common stock held by the Sponsor (the “Conversion”).

The 5,000,000 shares of Class A common stock issued in connection with the Conversion are subject to the same restrictions as applied

to the Class B common stock prior to the Conversion, including, among other things, certain transfer restrictions, waiver of redemption

rights and the obligation to vote in favor of the Initial Business Combination as described in the prospectus for the Initial Public Offering.

On March 14, 2023, at a special meeting of our

stockholders, our stockholders approved the extension of our term to complete the Initial Business Combination from March 16, 2023 to

September 16,2023 (the “Third Extension”).

In connection with the Third Extension, the Sponsor loaned us an aggregate amount

of up to $344,781 (the “Third Extension Loan”), with (i) $57,464 ($0.04 for each Public Share that was not redeemed in connection

with the Third Extension) (the “Monthly Amount”) deposited into the Trust Account in connection with the first funding of

the Third Extension Loan on March 16, 2023, and (ii) the Monthly Amount being deposited into the Trust Account for each calendar month

thereafter (commencing on April 17, 2023 and ending on the 16 th day of each subsequent month through September 16, 2023),

or portion thereof, that is needed by the Company to complete the Initial Business Combination.

In connection with the stockholder vote

to approve the Third Extension, 1,523,509 Public Shares were redeemed at approximately $10.69 a share, resulting in a reduction of $16,290,945

in the amount held in the Trust Account.

Each of the First Extension Loan, the Second Extension

Loan and the Third Extension Loan bears no interest and is due and payable on the date on which we consummate the Initial Business Combination.

The principal balance of each loan may be prepaid at any time with funds outside of the Trust Account.

Pursuant to the terms and conditions of the XBP

Europe Business Combination (as defined below), in connection with the consummation of the XBP Europe Business Combination, all amounts

outstanding under each of the First Extension Loan, the Second Extension Loan and the Third Extension Loan will be converted into shares

of our Class A common stock in accordance with, and subject to the exceptions set forth in, the Merger Agreement (as defined below).

We have until September 16, 2023 or a later date

approved by our stockholders in accordance with the Amended and Restated Certificate of Incorporation, to consummate the Initial Business

Combination (the “Combination Period”).

If we are unable to complete the Initial Business Combination by the end of the Combination

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 taxes (less

up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will

completely extinguish public 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 of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) 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 the Initial Business Combination

within the Combination Period.

XBP Europe Business Combination

On October 9, 2022, we entered into an Agreement

and Plan of Merger (as it may be amended, supplemented or otherwise modified from time to time, the “Merger Agreement”) by

and among us, Sierra Merger Sub, Inc., a Delaware corporation and our direct wholly owned subsidiary (“Merger Sub”), BTC International

Holdings, Inc., a Delaware corporation (“Parent”), and XBP Europe, Inc., a Delaware corporation and a direct wholly owned

subsidiary of Parent (“XBP Europe”).

Pursuant to the Merger Agreement, subject to the terms and conditions set forth therein,

Merger Sub will merge with and into XBP Europe (the “Merger” and together with the other transactions contemplated by the

Merger Agreement, the “XBP Europe Business Combination”) whereby the separate existence of Merger Sub will cease and XBP Europe

will be the surviving corporation of the Merger and become our wholly owned subsidiary.

As a result of the Merger, (i) each share of capital

stock of Merger Sub shall automatically be converted into an equal number of shares of common stock of XBP Europe, (ii) each share of

stock of XBP Europe will be cancelled and exchanged for the right to receive a number of our shares of Class A common stock equal to (a)

the quotient of (1) (A) the sum of $220,000,000 minus (B) the Company Closing Indebtedness of XBP Europe (as contemplated

by the Merger Agreement) divided by (2) $10.00 plus (b) 1,330,650, and (iii) we will amend the Amended and

Restated Certificate of Incorporation to, among other matters, change our name to XBP Europe Holdings, Inc.

For more information related to the Merger Agreement

and the XBP Europe Business Combination, reference should be made to the Form 8-K that we filed with the SEC on October 11, 2022, our

Form 10-K filed with the SEC on March 29, 2023, and our Form 10-K/A for the year ended December 31, 2022, as filed with the SEC on April

25, 2023, and the proxy statement that we initially filed with the SEC on February 13, 2023 (as amended from time to time, the “XBP

Europe Proxy Statement”).

Liquidity and Capital Resources

As of both September 30, 2022 and December 31,

2021, we had approximately $265,000 and $25,000 of cash in our operating account.

As of September 30, 2022 and December 31, 2021, we had

a working capital deficit of approximately $8,825,000 and $2,634,000, respectively.

As of September 30, 2022 and December 31, 2021, we

had approximately $21,000 and $18,000, respectively, of interest income from the Trust Account available to pay taxes (less up to $100,000

of interest to pay dissolution expenses).

Our liquidity needs through September 30, 2022

have been satisfied through a contribution of $25,000 from the Sponsor in exchange for the issuance of the founder shares, a loan of approximately

$79,000 from the Sponsor pursuant to a promissory note (the “Pre-IPO Note”), the proceeds from the consummation of the Private

Placement with the Sponsor not held in the Trust Account, the Sponsor Loan (as defined below) and the First Working Capital Loan (as defined

We fully repaid the Pre-IPO Note upon completion of the Initial Public Offering.

In addition, in order to finance transaction

costs in connection with an Initial Business Combination, the Sponsor has committed up to $1,750,000 to be provided to us to fund our

expenses relating to investigating and selecting a target business and other working capital requirements after the Initial Public Offering

and prior to our Initial Business Combination (the “Sponsor Loan”), which Sponsor Loan has been fully drawn by us.

Sponsor Loan is insufficient, the Sponsor or an affiliate of the Sponsor, or certain of our officers and directors may, but are not obligated

to, provide us additional loans (“Working Capital Loans”).

As of March 31, 2023 and December 31, 2022, we

had $25,000 and approximately $41,200, respectively, of cash in our operating account.

As of March 31, 2023 and December 31, 2022, we

had a working capital deficit of approximately $10,118,000 and $9,209,000, respectively.

As of March 31, 2023 and December 31, 2022, approximately

$285,000 and $276,000, respectively, of interest income earned on funds held in the Trust Account was available to pay taxes.

Our liquidity needs through March 31, 2023 have

been satisfied through a contribution of $25,000 from the Sponsor in exchange for the issuance of the founder shares, a loan of approximately

$9,121,000 from the Sponsor pursuant to a promissory note (the “Pre-IPO Note”), the proceeds from the consummation of the

Private Placement with the Sponsor not held in the Trust Account, the Sponsor Loan (as defined below) the First Working Capital Loan (as

defined below), the Second Working Capital Loan (as defined below), and the Third Working Capital Loan (as defined below).

We fully repaid

the Pre-IPO Note upon completion of the Initial Public Offering.

In addition, in order to finance transaction costs in connection with

the Initial Business Combination, the Sponsor loaned us $1,750,000 to fund our expenses relating to investigating and selecting a target

business and other working capital requirements after the Initial Public Offering and prior to the Initial Business Combination (the “Sponsor

If the Sponsor Loan is insufficient, the Sponsor or an affiliate of the Sponsor, or certain of our officers and directors

may, but are not obligated to, provide us additional loans (“Working Capital Loans”).

On June 30, 2022, we entered into a Working Capital

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Working Capital Loan with the Sponsor in the amount of up to $750,000 (the “Second Working Capital Loan”) in connection with

advances the Sponsor will make to us for working capital expenses.

advances the Sponsor will make to us for working capital expenses, which Second Working Capital Loan has been fully drawn by us.

On March 31, 2023, we entered into a third Working

Capital Loan with the Sponsor in the amount of up to $500,000 (the “Third Working Capital Loan”) in connection with advances

the Sponsor will make to us for working capital expenses.

On March 9, 2022, we borrowed $4,424,015 ($0.20

for each Public Share that was not redeemed in connection with the First Extension) from the Sponsor pursuant to the First Extension Loan,

which was deposited in the Trust Account.

which was deposited into the Trust Account.

On September 30, 2022, we borrowed $976,832 ($0.33

for each Public Share that was not redeemed in connection with the Second Extension) from the Sponsor pursuant to the Second Extension

Loan, which was deposited in the Trust Account.

As of September 30, 2022 and December 31, 2021,

approximately $8,151,000 and $734,000, respectively, was outstanding under the loans payable by us to the Sponsor.

As of September 30,

2022 and December 31, 2021, these amounts included $1,750,000 and approximately $734,000, respectively, outstanding under the Sponsor

Loan, $4,424,015 and $0, respectively, outstanding under the First Extension Loan, $976,832 and $0, respectively, outstanding under the

Second Extension Loan, and $1,000,000 and $0, respectively, outstanding under the First Working Capital Loan.

See “Related Party

Loans” below for additional information.

Loan, which was deposited into the Trust Account.

On March 15, 2023, we entered into the Third Extension

Loan, pursuant to which we are entitled to borrow up to $344,781 from the Sponsor ($0.04 per share per month, or up to $0.24 per share

in the aggregate if all six months of the Third Extension are utilized, for each Public Share that was not redeemed in connection with

the Third Extension).

The funding of the initial Monthly Amount was deposited into the Trust Account on March 16, 2023, and additional

fundings of the Monthly Amount will be deposited into the Trust Account for each calendar month thereafter (commencing on April 17, 2023

and ending on the 16 th day of each subsequent month through September 16, 2023), or portion thereof, that we need to complete

the Initial Business Combination.

As of March 31, 2023 and December 31, 2022, the

carrying amounts of the loans payable by us to the Sponsor were approximately $9,121,000 and $8,200,000, respectively.

As of March 31,

2023 and December 31, 2022, the face amounts of these loans were approximately $9,121,000 and $8,500,000, respectively.

Based on the foregoing, management believes that

we will have sufficient working capital and borrowing capacity from the Sponsor to meet our needs through the earlier of the consummation

of an Initial Business Combination or one year from the date of this report.

Over this time period, we will be using these funds for paying

existing accounts payable, identifying and evaluating prospective target businesses, performing due diligence on prospective target businesses,

paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating

the Initial Business Combination.

of the Initial Business Combination or one year from the date of this Report.

Over this time period, we will be using these funds for

paying existing accounts payable, identifying and evaluating prospective target businesses, performing due diligence on prospective target

businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating

the Initial Business Combination, including the XBP Europe Business Combination.

Results of Operations

Our entire activity from inception through September

Our entire activity from inception through March

31, 2023 related to our formation, the Initial Public Offering, and, to our efforts towards locating and completing a suitable Initial

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We will not generate any operating

revenues until after completion of our Initial Business Combination.

We will generate non-operating income in the form of interest income

on investments held in the Trust Account.

We expect to incur increased expenses as a result of being a public company (for legal, financial

reporting, accounting and auditing compliance), as well as for due diligence expenses.

For the three months ended September 30, 2022,

we had a net loss of approximately $811,000 which consisted of approximately $1,109,000 of general and administrative expenses, approximately

$690,000 of interest expense due to the redemption of Class A common stock, approximately $456,000 of loss from the change in fair value

of FPS liability, approximately $98,000 of income tax expense, $50,000 of franchise tax expense, and $30,000 of administrative expenses

paid to the Sponsor, partially offset by approximately $1,103,000 of gain from the change in fair value of warrant liability and approximately

$519,000 of interest income on investments held in the Trust Account.

For the nine months ended September 30, 2022,

we had net income of approximately $3,566,000 which consisted of approximately $4,726,000 of gain from the change in fair value of warrant

liability, approximately $957,000 of interest income on investments held in the Trust Account, approximately $579,000 of other income

and approximately $249,000 of gain from the change in fair value of FPS liability, partially offset by approximately $1,913,000 of general

and administrative expenses, approximately $690,000 of interest expense due to the redemption of Class A common stock, approximately $139,000

of income tax expense, approximately $113,000 of franchise tax expense and $90,000 of administrative expenses paid to the Sponsor.

For the three months ended September 30, 2021,

we had a net loss of approximately $1,055,000, which consisted of approximately $1,137,000 in general and administrative expenses, $60,000

of franchise tax expense and $30,000 in administrative expenses paid to the Sponsor, which were partially offset by approximately $102,000

of gain from change in fair value of the FPS liability, approximately $64,000 of gain from the change in fair value of the warrant liability,

and approximately $6,000 in interest income on investments held in Trust Account.

For the nine months ended September 30, 2021,

we had a net loss of approximately $2,441,000, which consisted of approximately $2,001,000 of loss from the change in fair value of the

FPS liability, approximately $1,539,000 in general and administrative expenses, approximately $141,000 of franchise tax expense, and approximately

$65,000 in administrative expenses paid to the Sponsor, which were partially offset by approximately $1,294,000 of gain from the change

in fair value of warrants liability and approximately $11,000 in interest income on investments held in the Trust Account.

revenues until after completion of the Initial Business Combination.

We generate non-operating income in the form of interest income

on cash and investments held in the Trust Account.

We expect to incur increased expenses as a result of being a public company (for legal,

financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

For the three months ended March 31, 2023, we

had a net loss of approximately $1,594,000 which consisted of approximately $578,000 of interest expense on sponsor loans and mandatorily

redeemable Class A common stock, approximately $500,000 of general and administrative expenses, approximately $491,000 of loss from the

change in fair value of warrant liability, approximately $260,000 of loss from the change in fair value of FPS liability, $80,000 of franchise

tax expense, and $30,000 of administrative expenses paid to the Sponsor, partially offset by approximately $345,000 of interest income

from cash and investments held in the Trust Account.

For the three months ended March 31, 2022, we

had net income of approximately $3,412,000 which consisted of approximately $3,193,000 of gain from the change in fair value of warrant

liability, approximately $579,000 of other income, approximately $47,000 of gain from the change in fair value of FPS liability, and approximately

$7,000 of interest income from investments held in the Trust Account, partially offset by approximately $371,000 of general and administrative

expenses, $30,000 of administrative expenses paid to the Sponsor, and approximately $13,000 of franchise tax expense.

Contractual Obligations

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We engaged Cantor Fitzgerald & Co.

an affiliate of the Sponsor, as an advisor in connection with the Initial Business Combination to assist us in holding meetings with our

an affiliate of the Sponsor, as an advisor in connection with any Initial Business Combination to assist us in holding meetings with our

stockholders to discuss any potential Initial Business Combination and the target business’ attributes, introduce us to potential

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We will pay CF&Co.

a cash fee for such services upon the consummation of the Initial Business Combination

in an amount of $9,350,000 (the “Marketing Fee”), which is equal to, in the aggregate, 3.5% of the gross proceeds of the base

offering in the Initial Public Offering and 5.5% of the gross proceeds from the partial exercise of the underwriters’ over-allotment

provided, however, in connection with the proposed business combination between us and XBP Europe, Inc.

(“XBP Europe”),

as described in Note 9 – “Subsequent events” to our unaudited condensed financial statements in Part I, Item 1 of this

report, subject to and conditioned upon the closing of such business combination, CF&Co.

agreed to waive the Marketing Fee.

we engaged CF&Co.

as our exclusive financial advisor for the proposed business combination with XBP Europe, but CF&Co.

entitled to any fee with respect to such engagement.

a cash fee (the “Marketing Fee”) for such services upon the consummation

of the Initial Business Combination in an amount equal to $9,350,000, which is equal to 3.5% of the gross proceeds of the base offering

in the Initial Public Offering and 5.5% of the gross proceeds from the partial exercise of the underwriters’ over-allotment option;

provided, however, in connection with the XBP Europe Business Combination, subject to and conditioned upon its closing, CF&Co.

to waive the Marketing Fee.

If the Initial Business Combination other than the XBP Europe Business Combination is consummated, CF&Co.

would be entitled to receive the Marketing Fee that will be released from the Trust Account only upon completion of such an Initial Business

Engagement Letter

We have engaged CF&Co.

as our exclusive financial

advisor in connection with the XBP Europe Business Combination but CF&Co.

has agreed not to receive an advisory fee for such services

other than to receive reimbursement of actual expenses incurred and to be indemnified against certain liabilities arising out of its engagement.

Related Party Loans

In order to finance transaction costs in connection

with an intended Initial Business Combination, the Sponsor committed up to $1,750,000 in the Sponsor Loan to be provided to us to fund

expenses relating to investigating and selecting a target business and other working capital requirements, including $10,000 per month

for office space, administrative and shared personnel support services that will be paid to the Sponsor, after the Initial Public Offering

and prior to the Initial Business Combination, which has been fully drawn by us.

with an intended Initial Business Combination, the Sponsor loaned us $1,750,000 in the Sponsor Loan to fund expenses relating to investigating

and selecting a target business and other working capital requirements, including $10,000 per month for office space, administrative and

shared personnel support services that will be paid to the Sponsor, after the Initial Public Offering and prior to the Initial Business

On March 9, 2022, we borrowed $4,424,015 ($0.20

for each Public Share that was not redeemed in connection with the First Extension) from the Sponsor pursuant to the First Extension Loan,

which was deposited in the Trust Account.

The First Extension Loan will not bear interest and will be repayable by us to the Sponsor or

its designees upon consummation of an Initial Business Combination.

On September 30, 2022, we borrowed $976,832 ($0.33

for each Public Share that was not redeemed in connection with the Second Extension) from the Sponsor pursuant to the Second Extension

Loan, which was deposited in the Trust Account.

The Second Extension Loan will not bear interest and will be repayable by us to the Sponsor

or its designees upon consummation of an Initial Business Combination.

which was deposited into the Trust Account.

On June 30, 2022, we entered into the First Working

Capital Loan, which has been fully drawn by us.

The First Working Capital Loan bears no interest and is due and payable on the date on

which we consummate our Initial Business Combination.

The principal balance of the First Working Capital Loan may be prepaid at any time.

On September 30, 2022, we borrowed $976,832 ($0.33

for each Public Share that was not redeemed in connection with the Second Extension) from the Sponsor pursuant to the Second Extension

Loan, which was deposited into the Trust Account.

On October 14, 2022, we entered into the Second

Working Capital Loan.

The Second Working Capital Loan bears no interest and is due and payable on the date on which we consummate our

Initial Business Combination.

The principal balance of the Second Working Capital Loan may be prepaid at any time.

As of September 30, 2022 and December 31, 2021,

approximately $8,151,000 and $734,000, respectively, was outstanding under the loans payable by us to the Sponsor.

As of September 30,

2022 and December 31, 2021, these amounts included $1,750,000 and approximately $734,000, respectively, outstanding under the Sponsor

Loan, $4,424,015 and $0, respectively, outstanding under the First Extension Loan, $976,832 and $0, respectively, outstanding under the

Second Extension Loan, and $1,000,000 and $0, respectively, outstanding under the First Working Capital Loan.

The Sponsor pays expenses on our behalf and we

reimburse the Sponsor for such expenses paid on our behalf.

As of September 30, 2022 and December 31, 2021, we had accounts payable outstanding

to the Sponsor for such expenses paid on our behalf of approximately $78,000 and $571,000, respectively.

Further, in connection with the proposed business

combination with XBP Europe, subject to and conditioned upon the closing of such business combination, the Sponsor agreed that all amounts

outstanding under loans from the Sponsor to us shall be automatically converted into shares of Class A common stock in accordance with,

and subject to the exceptions set forth in, the Agreement and Plan of Merger, dated October 9, 2022, among us, XBP Europe and the other

parties thereto.

Working Capital Loan, which has been fully drawn by us.

On March 15, 2023, we entered into the Third Extension

Loan, pursuant to which we are entitled to borrow up to $344,781 from the Sponsor ($0.04 per share per month, or up to $0.24 per share

in the aggregate if all six months of the Third Extension are utilized, for each Public Share that was not redeemed in connection with

the Third Extension).

The funding of the initial Monthly Amount was deposited into the Trust Account on March 16, 2023, and additional

fundings of the Monthly Amount will be deposited into the Trust Account for each calendar month thereafter (commencing on April 17, 2023

and ending on the 16 th day of each subsequent month through September 16, 2023), or portion thereof, that we need to complete

the Initial Business Combination.

On March 31, 2023, we entered into the Third Working

Capital Loan.

Each of the First Extension Loan, the First Working

Capital Loan, the Second Extension Loan, the Second Working Capital Loan, the Third Extension Loan and the Third Working Capital Loan

bears no interest and is due and payable on the date on which we consummate the Initial Business Combination.

The principal balance of

each loan may be prepaid at any time with funds outside of the Trust Account.

Pursuant to the terms and conditions of the XBP

Europe Business Combination, in connection with the consummation of the XBP Europe Business Combination, all amounts outstanding under

each of the First Working Capital Loan, the Second Working Capital Loan, the Third Working Capital Loan, the First Extension Loan, the

Second Extension Loan and the Third Extension Loan will be converted into shares of Class A common stock in accordance with, and subject

to the exceptions set forth in, the Merger Agreement.

As of March 31, 2023 and December 31, 2022, the

carrying amounts of the loans payable by us to the Sponsor were approximately $9,121,000 and $8,200,000, respectively.

As of March 31,

2023 and December 31, 2022, the face amounts of these loans were approximately $9,121,000 and $8,500,000, respectively.

Critical Accounting Policies and Estimates

We have identified the following as our critical

accounting polices:

Use of Estimates

The preparation of our unaudited condensed financial

statements and related disclosures in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the

reported amounts of assets and liabilities, income and expenses, and the disclosure of contingent assets and liabilities in our unaudited

condensed financial statements.

These accounting estimates require the use of assumptions about matters, some of which are highly uncertain

at the time of estimation.

Management bases its estimates on historical experience and on various other assumptions it believes to be

reasonable under the circumstances, the results of which form the basis for making judgments, and we evaluate these estimates on an ongoing

To the extent actual experience differs from the assumptions used, our unaudited condensed balance sheets, unaudited condensed

statements of operations, unaudited condensed statements of stockholders’ deficit and unaudited condensed statements of cash flows

The preparation of our unaudited condensed consolidated

financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America

requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, income and expenses,

and the disclosure of contingent assets and liabilities, in our unaudited condensed consolidated financial statements.

These accounting

estimates require the use of assumptions about matters, some of which are highly uncertain at the time of estimation.

Management bases

its estimates on historical experience and on various other assumptions it believes to be reasonable under the circumstances, the results

of which form the basis for making judgments, and we evaluate these estimates on an ongoing basis.

To the extent actual experience differs

from the assumptions used, our unaudited condensed consolidated balance sheets, unaudited condensed consolidated statements of operations,

unaudited condensed consolidated statements of stockholders’ deficit and unaudited condensed consolidated statements of cash flows

could be materially affected.

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in accordance with guidance in the Financial Accounting Standards Board Accounting Standards Codification (“ASC”) 205-40,

Presentation of Financial Statements – Going Concern , we have until March 16, 2023 to consummate an Initial Business Combination.

Our mandatory liquidation date, if an Initial Business Combination is not consummated, raises substantial doubt about our ability to continue

Presentation of Financial Statements – Going Concern , we have until September 16, 2023 to consummate the Initial Business

Our mandatory liquidation date, if the Initial Business Combination is not consummated, raises substantial doubt about our

ability to continue as a going concern.

Our unaudited condensed consolidated financial statements included in this Report do not include

any adjustments related to the recovery of the recorded assets or the classification of the liabilities should we be unable to continue

as a going concern.

Our unaudited condensed financial statements included in this Report do not include any adjustments related to the

recovery of the recorded assets or the classification of the liabilities should we be unable to continue as a going concern.

of a mandatory liquidation, within ten business days, we will 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 taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding

Public Shares.

In the event of a mandatory liquidation, within ten business days, we will 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 taxes (less up to $100,000 of interest to pay dissolution expenses),

divided by the number of then outstanding Public Shares.

Emerging Growth Company

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they are measured at fair value at inception and at each reporting date in accordance with the guidance in ASC 820, Fair Value Measurement ,

with any subsequent changes in fair value recognized in the statement of operations in the period of change.

with any subsequent changes in fair value recognized in the unaudited condensed consolidated statements of operations in the period of

Class A Common Stock Subject to Possible Redemption

We account for our Class A common stock subject

to possible redemption in accordance with the guidance in ASC 480, Distinguishing Liabilities from Equity .

Shares of Class A common

stock subject to mandatory redemption (if any) are classified as liability instruments and measured at fair value.

Shares of conditionally

redeemable Class A common stock (including shares of Class A common stock that feature redemption rights that are either within the control

of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) are classified as temporary

We account for our shares of Class A common stock

subject to possible redemption in accordance with the guidance in ASC 480, Distinguishing Liabilities from Equity .

Shares of Class

A common stock subject to mandatory redemption (if any) are classified as liability instruments and measured at fair value.

conditionally redeemable Class A common stock (including shares of Class A common stock that feature redemption rights that are either

within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) are classified

as temporary equity.

At all other times, shares of Class A common stock are classified as stockholders’ equity.

All of the Public Shares feature

certain redemption rights that are considered to be outside of our control and subject to the occurrence of uncertain future events.

as of September 30, 2022 and December 31, 2021, 2,960,098 and 25,000,000 shares of Class A common stock subject to possible redemption,

respectively, are presented as temporary equity outside of the stockholders’ deficit section of our balance sheets.

any subsequent changes in redemption value immediately as they occur and adjust the carrying value of redeemable shares of Class A common

stock to the redemption value at the end of each reporting period.

Immediately upon the closing of the Initial Public Offering, we recognized

the accretion from initial book value to redemption amount value of redeemable Class A common stock.

This method would view the end of

the reporting period as if it were also the redemption date for the security.

The change in the carrying value of redeemable shares of

Class A common stock also resulted in charges against Additional paid-in capital and Accumulated deficit.

All of the Public

Shares feature certain redemption rights that are considered to be outside of our control and subject to the occurrence of uncertain future

Accordingly, as of March 31, 2023 and December 31, 2022, 1,436,589 and 2,960,098 shares of Class A common stock subject to possible

redemption, respectively, are presented as temporary equity outside of the stockholders’ deficit section of our unaudited condensed

consolidated balance sheets.

We recognize any subsequent changes in redemption value immediately as they occur and adjust the carrying

value of redeemable shares of Class A common stock to the redemption value at the end of each reporting period.

Immediately upon the closing

of the Initial Public Offering, we recognized the accretion from initial book value to redemption amount value of redeemable shares of

Class A common stock.

This method would view the end of the reporting period as if it were also the redemption date for the security.

The change in the carrying value of redeemable shares of Class A common stock also resulted in charges against Additional paid-in capital

and Accumulated deficit.

Net Income (Loss) Per Share of Common Stock

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We have not considered the effect of the warrants

to purchase an aggregate of 6,385,000 shares of Class A common stock sold in the Initial Public Offering and the concurrent Private Placement

in the calculation of diluted earnings per share, because their exercise is contingent upon future events and their inclusion would be

anti-dilutive under the treasury stock method.

As a result, diluted earnings per share of common stock is the same as basic earnings per

share of common stock for the periods presented.

to purchase an aggregate of 6,385,000 shares of Class A common stock sold in the Initial Public Offering and the Private Placement in

the calculation of diluted earnings per share, because their exercise is contingent upon future events and their inclusion would be anti-dilutive

under the treasury stock method.

As a result, diluted earnings per share of common stock is the same as basic earnings per share of common

stock for the periods presented.

See Note 2—“Summary of Significant

Accounting Policies” to our unaudited condensed financial statements in Part I, Item 1 of this report for additional information

regarding these critical accounting policies and other significant accounting policies.

Accounting Policies” to our unaudited condensed consolidated financial statements in Part I, Item 1 of this Report for additional

information regarding these critical accounting policies and other significant accounting policies.

Factors That May Adversely Affect Our Results of Operations

Our results of operations and our ability to complete

an Initial Business Combination may be adversely affected by various factors that could cause economic uncertainty and volatility in the

financial markets, many of which are beyond our control.

Our business could be impacted by, among other things, downturns in the financial

markets or in economic conditions, increases in oil prices, inflation, increases in interest rates, supply chain disruptions, declines

in consumer confidence and spending, the ongoing effects of the COVID-19 pandemic, including resurgences and the emergence of new variants,

and geopolitical instability, such as the military conflict in the Ukraine.

We cannot at this time fully predict the likelihood of one

or more of the above events, their duration or magnitude or the extent to which they may negatively impact our business and our ability

to complete an Initial Business Combination.

the Initial Business Combination, including the XBP Europe Business Combination, may be adversely affected by various factors that could

cause economic uncertainty and volatility in the financial markets, many of which are beyond our control.

Our business could be impacted

by, among other things, downturns in the financial markets or in economic conditions, increases in oil prices, inflation, increases in

interest rates, supply chain disruptions, declines in consumer confidence and spending, and geopolitical instability, such as the military

conflict in the Ukraine.

We cannot at this time fully predict the likelihood of one or more of the above events, their duration or magnitude

or the extent to which they may negatively impact our business and our ability to complete the Initial Business Combination, including

the XBP Europe Business Combination.

Recent Developments

On March 16, 2023, we instructed Continental to

liquidate the investments held in the Trust Account and instead to hold the funds in the Trust Account in an interest-bearing

demand deposit account at Citibank, N.A., with Continental continuing to act as trustee, until the earlier of the consummation of the

Initial Business Combination or our liquidation.

As a result, following the liquidation of investments in the Trust Account,

the remaining proceeds from the Initial Public Offering and the Private Placement are no longer invested in U.S.

government debt securities

or money market funds that invest in U.S.

government debt securities.

Off-Balance Sheet Arrangements and Contractual Obligations

As of September 30, 2022, we did not have any off-balance sheet arrangements

As of March 31, 2023, we did not have any off-balance sheet arrangements

as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual obligations.

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What changed 10-Q

Item 2. Management’s Discussion and Analysis