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Item 2. Management’s Discussion and Analysis

2023-11-14 compared with 2023-08-14 · 46 added, 33 removed, 97 unchanged (45% of the section changed)

18 unchanged sentences

the lack of a market for our securities;

the use of proceeds not held in the trust account or available to us from interest income on the trust account balance;

the use of proceeds not held in the trust account or available to us from interest or dividend income on the trust account balance;

the trust account not being subject to claims of third parties;

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Our sponsor is ESGEN LLC, a Delaware limited liability company (the “Sponsor”).

The registration statement for our initial public offering (“initial public offering” or “Public Offering”) was declared effective on October 19, 2021.

The registration statement for our initial public offering (“initial public offering”, “IPO” or “Public Offering”) was declared effective on October 19, 2021.

On October 22, 2021, we consummated our initial public offering of 27,600,000 units (the “Units” and, with respect to the ordinary shares included in the Units being offered, the “Public Shares”) at $10.00 per Unit (which included the full exercise of the underwriters’ over-allotment option), and the sale of 14,040,000 warrants (the “Private Placement Warrants”) each exercisable to purchase one Class A ordinary share at $11.50 per share, at a price of $1.00 per Private Placement Warrant in a private placement to our Sponsor that closed simultaneously with the initial public offering.

Following the closing of our initial public offering on October 22, 2021, $281,520,000 ($10.20 per Unit) from the net proceeds sold in our initial public offering, including proceeds of the sale of the Private Placement Warrants, was deposited in a trust account (“Trust Account”) and will only be invested in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S.

Following the closing of our initial public offering on October 22, 2021, $281,520,000 ($10.20 per Unit) from the net proceeds sold in our initial public offering, including proceeds of the sale of the Private Placement Warrants, was deposited in a trust account (“Trust Account”) and, until October 16, 2023, was only invested in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S.

government treasury obligations.

Prior to shareholder approval of the Charter Amendment (as defined below), we had 15 months from the closing of our initial public offering to consummate the initial Business Combination.

To mitigate the risk of being deemed to have been operating as an unregistered investment company under the Investment Company Act, on October 16, 2023, we instructed the Trustee with respect to the Trust Account, to liquidate the U.S.

government securities or money market funds held in the Trust Account and thereafter to hold all funds in the Trust Account in demand deposits (i.e., in one or more bank accounts) until the earliest of ESGEN’s completion of an initial business combination or January 22, 2024 (unless extended as described below), as applicable.

Prior to shareholder approval of the First Extension Charter Amendment (as defined below), we had 15 months from the closing of our initial public offering to consummate the initial Business Combination.

If we have not consummated the initial Business Combination within 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 income taxes, if any (less up to $100,000 of interest to pay winding up and dissolution expenses) divided by the number of the then-outstanding public shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any);

(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 income taxes, if any (less up to $100,000 of interest or dividends to pay winding up and dissolution expenses) divided by the number of the then-outstanding public shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any);

and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and board of directors, liquidate and dissolve, subject in the case of clauses (ii) and (iii), to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.

On January 18, 2023, the Company held an extraordinary general meeting of shareholders (the “Meeting”) to consider and vote upon, among other things, a proposal to amend the Company’s amended and restated memorandum and articles of association (the “Charter Amendment”) to (i) extend the date by which the Company must consummate its initial business combination (the “Termination Date”) from January 22, 2023 to April 22, 2023 and (ii) in the event that the Company has not consummated an initial business combination by April 22, 2023, to allow the Company, by resolution of the Company’s board of directors (the “Board”) and, without any approval of the Company’s shareholders, upon five days’ advance notice prior to each Additional Extension, to extend the Termination Date up to six times (with each such extension being upon five days’ advance notice), each by one additional month (for a total of up to six additional months to complete a business combination) (each, an “Additional Extension” and such date, an “Additional Extension Date”), provided that the Sponsor or the Sponsor’s affiliates or permitted designees will deposit into the Trust Account for each Additional Extension Date the lesser of (a) US $140,000 or (b) $0.04 for each Public Share that is then-outstanding, in exchange for one or more non-interest bearing, unsecured promissory notes issued by the Company to the Sponsor or the Sponsor’s affiliates or permitted designees (the “Lenders” and each a “Lender”).

In connection with the vote to approve the Charter Amendment, the holders of 24,703,445 Class A ordinary shares properly exercised their right to redeem their shares for cash at a redemption price of approximately $10.35 per share, for an aggregate redemption amount of $255,875,758.

The Company’s current Additional Extension Date as of the date hereof is August 22, 2023.

On January 18, 2023, the Company held an extraordinary general meeting of shareholders to consider and vote upon, among other things, a proposal to amend the Company’s amended and restated memorandum and articles of association (the “First Extension Charter Amendment”) to (i) extend the date by which the Company must consummate its initial Business Combination (the “Termination Date”) from January 22, 2023 to April 22, 2023 and (ii) in the event that the Company has not consummated an initial Business Combination by April 22, 2023, to allow the Company, by resolution of the Company’s board of directors (the “Board”) and, without any approval of the Company’s shareholders, upon five days’ advance notice prior to each Additional Extension, to extend the Termination Date up to six times (with each such extension being upon five days’ advance notice), each by one additional month (for a total of up to six additional months to complete a business combination) (each, an “Additional Extension” and such date, an “Additional Extension Date”), provided that the Sponsor or the Sponsor’s affiliates or permitted designees will deposit into the Trust Account for each Additional Extension Date the lesser of (a) $140,000 or (b) $0.04 for each Public Share that is then-outstanding, in exchange for one or more non-interest bearing, unsecured promissory notes issued by the Company to the Sponsor or the Sponsor’s affiliates or permitted designees (the “Lenders” and each a “Lender”).

In connection with the vote to approve the First Extension Charter Amendment, the holders of 24,703,445 Class A ordinary shares properly exercised their right to redeem their shares for cash at a redemption price of approximately $10.35 per share, for an aggregate redemption amount of $255,875,758.

The Company currently has until January 22, 2024 (after giving effect to the second extension described below) to complete an initial Business Combination.

On October 20, 2023, the Company held an extraordinary general meeting (the “Meeting”) and approved (i) (a) the extension (such proposal, the “Extension Proposal”) of the time period the Company has to complete an initial Business Combination from October 22, 2023 to January 22, 2024 (the “Charter Amendment”) and (b) in the event that the Company has not consummated an initial Business Combination by January 22, 2024, to allow the Company, by resolution of the Board and, without any approval of the Company’s shareholders, upon five days’ advance notice prior to each Additional Extension, to complete six Additional Extensions, provided that the Sponsor or the Sponsor’s affiliates or permitted designees will deposit into the Trust Account for each Additional Extension Date the lesser of (x) $35,000 or (y) $0.0175 for each Public Share that is then-outstanding, in exchange for one or more non-interest bearing, unsecured promissory notes issued by a Lender, and (ii) the amendment of the Company’s amended and restated memorandum and articles of association to change certain provisions which restrict the Class B ordinary shares, par value $0.0001, of the Company (the “Class B ordinary shares”) from converting to Class A ordinary shares, par value $0.0001 (the “Class A ordinary shares”) prior to the consummation of an initial Business Combination (such proposal, the “Conversion Proposal”).

In connection with the vote to approve the above proposals, the holders of 1,488,000 Class A ordinary shares of ESGEN properly exercised their right to redeem their shares for cash at a redemption price of approximately $11.21 per share, for an aggregate redemption amount of $16,679,055.

In connection with the approval of the Extension Proposal at the Meeting and the adoption of the Charter Amendment, the Sponsor contributed into the Trust Account $0.0525 per share for each Class A ordinary share that was not redeemed at the Meeting, for an aggregate contribution of $73,949.

In connection with the approval of the Conversion Proposal at the Meeting and the adoption of the Charter Amendment, the Sponsor converted all of its 5,619,077 Class B ordinary shares into Class A ordinary shares (the “Sponsor Share Conversion”).

As a result of the Sponsor Share Conversion and redemptions made in connection with the Extension Proposal and Conversion Proposal, 7,027,632 Class A ordinary shares remain outstanding.

Notwithstanding the Sponsor Share Conversion, the Sponsor will be not entitled to receive any funds held in the Trust Account with respect to any Class A ordinary shares issued to the Sponsor as a result of the Sponsor Share Conversion and no additional amounts will be deposited into the Trust Account in respect of shares of Class A ordinary shares held by the Sponsor in connection with the extension of the Termination Date to the Extended Date or any Additional Extension Dates.

On April 19, 2023, the Company entered into a Business Combination Agreement, by and among the Company, ESGEN OpCo, LLC, a Delaware limited liability company and wholly-owned subsidiary of ESGEN (“OpCo”), Sunergy Renewables, LLC, a Nevada limited liability company (“Sunergy”), the Sunergy equity holders set forth on the signature pages thereto (collectively, “Sellers” and each, a “Seller”, and collectively with Sunergy, the “Sunergy Parties”), for limited purposes, the Sponsor, and for limited purposes, Timothy Bridgewater, an individual, in his capacity as the Sellers Representative (the “Business Combination Agreement”).

In accordance with the terms and subject to the conditions of the Business Combination Agreement, among other things:

(i) prior to the consummation of the Business Combination (the “Closing”), each issued and outstanding Class B ordinary share, par value $0.0001 per share, of ESGEN will convert into one ESGEN Class A ordinary share, par value $0.0001 per share, of ESGEN (the “ESGEN Share Conversion”);

and (ii) following the ESGEN Share Conversion but prior to the Closing, ESGEN will, subject to the receipt of the requisite shareholder approval, transfer by way of continuation from the Cayman Islands to the State of Delaware and domesticate as a Delaware corporation (the “Domestication”).

In connection with the Domestication, (A) each outstanding ESGEN Class A Ordinary Share will become one share of Class A common stock, par value $0.0001 per share, of ESGEN, (B) each outstanding warrant to purchase one ESGEN Class A Ordinary Share will become a warrant to purchase one share of ESGEN Class A Common Stock at an exercise price of $11.50 per share, and (C) ESGEN will file its certificate of incorporation and will adopt bylaws to serve as its governing documents upon consummation of the Domestication.

In connection with the ESGEN Share Conversion and the Domestication, each issued and outstanding unit of ESGEN, each consisting of ESGEN Class A Ordinary Share and one-half of one warrant to purchase one ESGEN Class A Ordinary Share (each, an “ESGEN Unit”), that has not been previously separated into the underlying ESGEN Class A Ordinary Shares and underlying ESGEN Warrants prior to the Domestication will be cancelled and will entitle the holder thereof to (x) one share of ESGEN Class A Common Stock and (y) one-half of one warrant representing the right to purchase one share of ESGEN Class A Common Stock at an exercise price of $11.50 per share on the terms and subject to the conditions applicable to ESGEN Warrants set forth in the Warrant Agreement, dated as of October 22, 2021, between ESGEN and Continental Stock Transfer & Trust Company (the “Trustee”).

(i) prior to the consummation of the Business Combination (the “Closing”), each issued and outstanding Class B ordinary share of ESGEN will convert into one Class A ordinary share of ESGEN (the “ESGEN Share Conversion”);

In connection with the Domestication, (A) each outstanding Class A ordinary share will become one share of Class A common stock, par value $0.0001 per share, of New PubCo (the “New PubCo Class A Common Stock”), (B) each outstanding warrant to purchase one Class A ordinary share (each, an “ESGEN Warrant”) will become a warrant to purchase one share of New PubCo Class A Common Stock at an exercise price of $11.50 per share, and (C) New PubCo will file its certificate of incorporation and will adopt bylaws to serve as its governing documents upon consummation of the Domestication.

In connection with the ESGEN Share Conversion and the Domestication, each issued and outstanding unit of ESGEN, each consisting of one Class A ordinary share and one-half of one ESGEN Warrant (each, an “ESGEN Unit”), that has not been previously separated into the underlying Class A ordinary shares and underlying ESGEN Warrants prior to the Domestication will be cancelled and will entitle the holder thereof to (x) one share of New PubCo Class A Common Stock and (y) one-half of one warrant representing the right to purchase one share of New PubCo Class A Common Stock at an exercise price of $11.50 per share on the terms and subject to the conditions applicable to ESGEN Warrants set forth in the Warrant Agreement, dated as of October 22, 2021, between ESGEN and Continental Stock Transfer & Trust Company (the “Trustee”).

In accordance with the terms and subject to the conditions of the Business Combination Agreement, Sunergy will cause all holders of any options, warrants or rights to subscribe for or purchase any equity interests of Sunergy or its subsidiaries or securities (including debt securities) convertible into or exchangeable for, or that otherwise confer on the holder any right to acquire, any equity interests of Sunergy or any subsidiary thereof (collectively, the “Sunergy Convertible Interests”) existing immediately prior to the Closing either to exchange or convert all such holder’s Sunergy Convertible Interests into limited liability interests of Sunergy (the “Sunergy Company Interests”) in accordance with the governing documents of Sunergy or the Sunergy Convertible Interests (collectively, the “Sunergy Exchanges”).

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Immediately following the ESGEN Contribution, (x) the Sellers will contribute to OpCo the Sunergy Company Interests and (y) in exchange therefor, OpCo will transfer to the Sellers the Seller OpCo Units and the Seller Class V Shares.

The obligation of ESGEN, the Sunergy Parties and OpCo to consummate the Business Combination is subject to certain customary closing conditions, including, but not limited to, (i) the absence of any order, law or other legal restraint or prohibition enacted, issued or promulgated by any court of competent jurisdiction or other governmental entity of competent jurisdiction having the effect of making the Business Combination illegal or otherwise prohibiting the consummation of the Business Combination, (ii) the termination or expiration of any applicable waiting period applicable to the consummation of the Business Combination under the Hart-Scott-Rodino Act, (iii) the effectiveness of the Registration Statement on Form S-4 (the “Registration Statement”) in accordance with the provisions of the Securities Act, registering the ESGEN Class A Common Stock to be issued in connection with the Business Combination Agreement, (iv) receipt of the required approvals of ESGEN’s shareholders at a meeting of the shareholders of ESGEN in connection with the Business Combination, (v) the ESGEN Class A Common Stock to be issued in connection with the Business Combination immediately after Closing shall be listed on Nasdaq and ESGEN will be able to satisfy any continued listing requirements of Nasdaq immediately after Closing, (vi) if the ESGEN shareholders do not approve the Redemption Limitation Amendment (as defined in the Business Combination Agreement), ESGEN having at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) remaining immediately after any holders of the ESGEN Class A Ordinary Shares exercise their redemption rights, (vii) the members of the post-Business Combination ESGEN board of directors shall have been elected or appointed in accordance with the Business Combination Agreement and (viii) the aggregate transaction proceeds, including from the Trust Account after giving effect to the exercise of redemption rights by any ESGEN shareholders pursuant to the ESGEN amended and restated memorandum and articles of association, as amended, and the proceeds resulting from the Initial PIPE Investment (as defined below) and any financing agreements executed in furtherance of the Business Combination Agreement, shall be greater or equal to $20.0 million.

Concurrently with the execution of the Business Combination Agreement, ESGEN entered into a subscription agreement (the “Initial Subscription Agreement”) with Sponsor.

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For additional information regarding the Business Combination Agreement, see the Company’s Current Report on Form 8-K filed with the SEC on April 20, 2023.

The Business Combination is expected to close in the fourth quarter of 2023, following the receipt of the required approvals by our shareholders and the fulfillment of other customary closing conditions.

The Business Combination is expected to close in the first quarter of 2024, following the receipt of the required approvals by our shareholders and the fulfillment of other customary closing conditions.

On April 5, 2023, the Company issued an unsecured promissory note (the “Note”) in the principal amount of up to $1,500,000 to the Sponsor, which may be drawn down by the Company from time to time prior to the consummation of the Company’s Business Combination.

The Note does not bear interest, matures on the date of consummation of the Business Combination and is subject to customary events of default.

As of June 30, 2023, there was approximately $515,862 outstanding under the Note.

As of September 30, 2023, there was $1,238,449 outstanding under the Note.

In addition, on October 17, 2023, the Company issued an amended and restated promissory note (the “Restated Note”) in the principal amount of up to $2,500,000 to the Sponsor.

The Restated Note amends, restates, replaces and supersedes the Note dated April 5, 2023.

The Restated Note may be drawn down by the Company from time to time prior to the consummation of the Company’s initial Business Combination.

The Restated Note does not bear interest, matures on the date of consummation the Business Combination and is subject to customary events of default.

The Restated Note will be repaid only to the extent that the Company has funds available to it outside of its Trust Account.

Results of Operations

All of our activity from April 19, 2021 (inception) through June 30, 2023, was in preparation for our initial public offering, and since our initial public offering, including the effectuation of the Charter Amendment and the negotiation and entry into the Business Combination Agreement.

All of our activity from April 19, 2021 (inception) through September 30, 2023, was in preparation for our initial public offering, and since our initial public offering, including the effectuation of the Charter Amendment and the negotiation and entry into the Business Combination Agreement.

We will not generate any operating revenues until the closing and completion of our initial Business Combination.

For the three months ended June 30, 2023, we had a net loss of $1,411,072, which consisted of a change in fair value of warrant liabilities of $378,624 and operating costs of $1,822,712, partially offset by interest income from marketable securities held in the Trust Account of $365,224 and recovery of offering costs allocated to warrants of $425,040.

For the three months ended June 30, 2022, we had a net income of $1,494,631, which consisted of a gain on change in fair value of warrant liabilities of $1,527,600, interest income from marketable securities held in Trust Account of $368,774, offset by operating costs of $401,743.

For the six months ended June 30, 2023, we had a net loss of $2,857,183, which consisted of a change in fair value of warrant liabilities of $1,252,800 and operating costs of $3,335,293, partially offset by interest income from marketable securities held in the Trust Account of $1,305,870 and recovery of offering costs allocated to warrants of $425,040.

For the six months ended June 30, 2022, we had a net income of $7,375,172, which consisted of a gain on change in fair value of warrant liabilities of $8,262,960, interest income from marketable securities held in Trust Account of $386,945, offset by formation and operating costs of $1,274,733.

For the three months ended September 30, 2023, we had net income of $631,724, which consisted of a change in fair value of warrant liabilities of $1,046,784 and dividends earned on marketable securities held in the Trust Account of $413,940, partially offset by operating costs of $829,000.

For the three months ended September 30, 2022, we had net income of $4,262,070, which consisted of a gain on change in fair value of warrant liabilities of $3,345,600, dividends earned on marketable securities held in trust account of $1,245,745, partially offset by operating costs of $329,275.

For the nine months ended September 30, 2023, we had a net loss of $2,225,459, which consisted of a change in fair value of warrant liabilities of $206,016 and operating costs of $4,164,293, partially offset by dividends earned on marketable securities held in the Trust Account of $1,719,810 and recovery of offering costs related to the IPO allocated to warrants of $425,040.

For the nine months ended September 30, 2022, we had net income of $11,637,242, which consisted of a gain on change in fair value of warrant liabilities of $11,608,560 and dividends earned on marketable securities held in trust account of $1,632,690, partially offset by operating costs of $1,604,008.

Liquidity and Capital Resources

As of June 30, 2023, we had cash of $50,193 and owe $4,664,539 in accounts payable and accrued expenses and an additional $996,401 payable to related parties.

Prior to the completion of our initial public offering, our liquidity needs had been satisfied through a capital contribution from the sponsor of $25,000 and a loan to us of up to $300,000 by our sponsor under an unsecured promissory note, which had an outstanding balance of $171,346 at June 30, 2023 and December 31, 2022.

As of September 30, 2023, we had cash of $267,058 and owe $5,296,038 in accounts payable and accrued expenses and an additional $1,718,988 payable to related parties.

Prior to the completion of our initial public offering, our liquidity needs had been satisfied through a capital contribution from the Sponsor of $25,000 and a loan to us of up to $300,000 by our Sponsor under an unsecured promissory note, which had an outstanding balance of $171,346 at September 30, 2023 and December 31, 2022.

The Sponsor has agreed to defer repayment of the loan until the close of the Business Combination.

On April 5, 2023, we issued an unsecured promissory note (the “Note”) in the principal amount of up to $1,500,000 to our Sponsor, which may be drawn down by us from time to time prior to the consummation of the initial Business Combination.

As of June 30, 2023, there was approximately $515,862 outstanding under the Note.

On April 5, 2023, we issued the Note in the principal amount of up to $1,500,000 to our Sponsor, which may be drawn down by us from time to time prior to the consummation of the initial Business Combination.

As of September 30, 2023, there was $1,238,449 outstanding under the Note.

In addition, in order to finance transaction costs in connection with a business combination, our Sponsor, an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, provide us Working Capital Loans.

As of June 30, 2023 and December 31, 2022, there were no amounts outstanding under any Working Capital Loans.

As of September 30, 2023 and December 31, 2022, there were no amounts outstanding under any Working Capital Loans.

Based on the foregoing, management believes that we will not have sufficient working capital and borrowing capacity to meet our needs through the earlier of the consummation of a Business Combination or one year from this filing.

Over this time period, we will be using these funds for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, 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 Business Combination.

In connection with the company’s assessment of going concern considerations in accordance with ASC Subtopic 205-40, “Presentation of Financial Statements – Going Concern”, the company has until August 22, 2023 (unless extended as described above) to consummate a Business Combination.

In connection with the company’s assessment of going concern considerations in accordance with ASC Subtopic 205-40, “Presentation of Financial Statements – Going Concern”, the company has until January 22, 2024 (unless extended as described above) to consummate a Business Combination.

If a Business Combination is not consummated by this date and an Additional Extension not obtained, there will be a mandatory liquidation and subsequent dissolution of the company.

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It is uncertain whether the company will be able to consummate a Business Combination or obtain an Additional Extension by this time.

No adjustments have been made to the carrying amounts of assets or liabilities should the company be required to liquidate after August 22, 2023 (unless extended as described above).

No adjustments have been made to the carrying amounts of assets or liabilities should the company be required to liquidate after January 22, 2024 (unless extended as described above).

Contractual Obligations

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Underwriting Agreement

The IPO underwriters were entitled to a deferred underwriting commission of 3.5% of the gross proceeds of our IPO upon the completion of our initial Business Combination.

In April 2023, the IPO underwriters waived any right to receive such deferred underwriting commissions and will therefore receive no additional underwriting commissions in connection with the Closing.

The IPO underwriters were entitled to a deferred underwriters fee of 3.5% of the gross proceeds of our IPO upon the completion of our initial Business Combination.

In April 2023, the IPO underwriters waived any right to receive such deferred underwriters fee and will therefore receive no additional underwriters fee in connection with the Closing.

Office Space, Secretarial and Administrative Services

Through the earlier of consummation of the initial Business Combination or the liquidation, the Company incurs $10,000 per month for office space, utilities, secretarial support and administrative services provided by the Sponsor.

For the three and six months ended June 30, 2023, the Company incurred $30,000 and $60,000, respectively, pursuant to this agreement.

For the three and nine months ended September 30, 2023, the Company incurred $30,000 and $90,000, respectively, pursuant to this agreement.

For the three and nine months ended September 30, 2022, the Company incurred $30,000 and $90,000, respectively, pursuant to this agreement.

No amounts have been paid for these services.

As of June 30, 2023 and December 31, 2022, the Company reported on the balance sheets $135,000 and $120,000, respectively, pursuant to this agreement, in “Due to related party”.

As of September 30, 2023 and December 31, 2022, the Company reported on the balance sheets $165,000 and $120,000, respectively, pursuant to this agreement, in “Due to related party”.

Registration Rights

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The Business Combination Agreement contemplates that, at the Closing, Sunergy, Sunergy’s underlying equityholders and the Initial Shareholders (as defined below) (collectively, the “New PubCo Holders”) and New PubCo will enter into an amended and restated IPO Registration Rights Agreement (the “A&R Registration Rights Agreement”), pursuant to which, among other things, New PubCo and the Initial Shareholders will agree to amend and restate the Registration and Shareholder Rights Agreement, dated as of October 22, 2021, entered into by them in connection with ESGEN’s IPO.

Pursuant to the A&R Registration Rights Agreement, New PubCo will agree that, within 30 days following the consummation of the Business Combination, it will use its commercially reasonable efforts to file a resale shelf registration statement on behalf of Sunergy, Sunergy’s underlying equityholders and the Initial Shareholders (the “New PubCo Holders”) registering (i) New PubCo’s private placement warrants, (ii) any outstanding shares of Class A common stock, par value $0.0001 per share, of New PubCo (“New PubCo Class A Common Stock”) held by the New PubCo Holders, (iii) any shares of New PubCo Class A Common Stock issued or issuable upon exchange of an equivalent number of Class B units of OpCo and Class V common stock of New PubCo, par value $0.0001 per share, issued to the Sellers pursuant to the Business Combination Agreement, (iv) any shares of New PubCo Class A Common Stock issued or to be issued to any of the New PubCo Holders in connection with the Business Combination and (v) any other equity security of New PubCo issued or issuable with respect to any of the foregoing by way of a stock dividend or stock split or in connection

Pursuant to the A&R Registration Rights Agreement, New PubCo will agree that, within 30 days following the consummation of the Business Combination, it will use its commercially reasonable efforts to file a resale shelf registration statement on behalf of Sunergy, Sunergy’s underlying equityholders and the Initial Shareholders registering (i) New PubCo’s private placement warrants, (ii) any outstanding shares of New PubCo Class A Common Stock held by the New PubCo Holders, (iii) any shares of New PubCo Class A Common Stock issued or issuable upon exchange of an equivalent number of Class B units of OpCo and Class V common stock of New PubCo, par value $0.0001 per share, issued to the Sellers pursuant to the Business Combination Agreement, (iv) any shares of New PubCo Class A Common Stock issued or to be issued to any of the New PubCo Holders in connection with the Business Combination and (v) any other equity security of New PubCo issued or issuable with respect to any of the foregoing by way of a stock dividend or stock split or in connection

with a combination of shares, recapitalization, merger, consolidation or reorganization (collectively, the “Registrable Securities”);

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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-Q

Item 2. Management’s Discussion and Analysis