EDGAR 10-K Filing

Company CIK: 1865111
Filing Year: 2022
Filename: 1865111_10-K_2022_0001829126-22-006943.json

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ITEM 1. BUSINESS
Item
1. BUSINESS
Company
Profile
Alpha
Star Acquisition Corporation is a blank check company incorporated on March 11, 2021 as a Cayman Islands exempted company and incorporated
for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination
with one or more businesses.
The
registration statement for our initial public offering was declared effective by the Securities and Exchange Commission on December 13,
2021. We completed our initial public offering on December 15, 2021. In our initial public offering, we sold units at an offering price
of $10.00 and consisting of one ordinary share, one right to receive one-seventh (1/7) of an ordinary share upon the consummation of
an initial business combination and one redeemable warrant. Each warrant entitles the holder thereof to purchase one-half of one ordinary
share.
In
connection with our initial public offering, we sold 11,500,000 units, generating gross proceeds of $115,000,000. Simultaneously with
the closing of the IPO, pursuant to the Private Placement Units Purchase Agreement by and between the Company and our sponsor, A-Star
Management Corporation, a British Virgin Islands company, the Company completed the private sale of an aggregate of 330,000 units (the
“Private Placement Units”) to the Sponsor at a purchase price of $10.00 per Private Placement Unit, generating gross
proceeds to the Company of $3,300,000. The Private Placement Units are identical to the Units in the IPO, except that the Sponsor has
agreed not to transfer, assign or sell any of the Private Placement Units (except to certain permitted transferees) until 30 days after
the completion of the Company’s initial business combination. No underwriting discounts or commissions were paid with respect to
such sale. The issuance of the Private Placement Units was made pursuant to the exemption from registration contained in Section 4(a)(2) of
the Securities Act of 1933, as amended.
Transaction
costs amounted to $5,669,696, consisting of $2,300,000 of underwriting fees, $2,875,000 of deferred underwriting fees and $494,696 of
other offering costs. A total of $115,000,000, comprised of $112,700,000 of the proceeds from the IPO (which amount includes up to $2,875,000
of the underwriter’s deferred discount) and $2,300,000 of the proceeds of the sale of the Private Placement Units, was placed in
a U.S.-based trust account, established by VStock Transfer LLC, our transfer agent and maintained at Wilmington Trust, National Association,
acting as trustee. Except with respect to interest earned on the funds in the trust account that may be released to the Company to pay
its taxes, the funds held in the trust account will not be released from the trust account until the earliest of (i) the completion
of the Company’s initial business combination, (ii) the redemption of any of the Company’s public shares properly tendered
in connection with a shareholder vote to amend the Company’s amended and restated memorandum and articles of association to (A) modify
the substance or timing of its obligation to redeem 100% of the Company’s public shares if it does not complete its initial business
combination within 9 months from the closing of the IPO (or up to 21 months from the closing of the IPO if we extend the period of time
to consummate a business combination), or (B) with respect to any other provision relating to shareholders’ rights or pre-business
combination activity, and (iii) the redemption of the Company’s public shares if it is unable to complete its initial business
combination within 9 months from the closing of the IPO (or up to 21 months from the closing of the IPO if we extend the period of time
to consummate a business combination.
At
December 31, 2021, the Company had working capital of $477,051, which exclude amount of $115,000,744 for marketable security
held in trust account in current asset, and amount of $2,875,000 for deferred underwriting commission in current
liability.
The
Company’s units are listed on The Nasdaq Global Market (“Nasdaq”) and commenced trading under the ticker symbol “ALSAU”
on December 13, 2021. Each unit consists of one ordinary share, one right to receive one-seventh (1/7) of an ordinary share upon the
consummation of an initial business combination, and one redeemable warrant. Each warrant entitles the holder thereof to purchase one-half
of one ordinary share of the Company at a price of $11.50 per whole share. The units began separate trading on January 18, 2022
and the ordinary shares, rights and warrants commenced trading on Nasdaq under the symbols “ALSA,” “ALSAR,” and
“ALSAW,” respectively.
Since
our IPO, our sole business activity has been identifying and evaluating suitable acquisition transaction candidates and engaging in non-binding
discussions with potential target entities. To date we have not entered into any binding agreement with any target entity. We presently
have no revenue and have had losses since inception from incurring formation and operating costs since completion of our IPO.
Acquisition
Strategy and Management Business Combination Experience
Our
efforts in identifying prospective target businesses will not be limited to a particular geographic region, although we intend to focus
on businesses that have a connection to the Asian market. However, we shall not consider or undertake a business combination with an
entity or business with its principal or a majority of its business operations (either directly or through any subsidiaries) in the People’s
Republic of China (including Hong Kong and Macau). We believe that we will add value to these businesses primarily by providing them
with access to the U.S. capital markets.
We
will seek to capitalize on the strength of our management team. Our team consists of experienced professionals and senior operating executives.
Collectively, our officers and directors have decades of experience in mergers and acquisitions, and operating companies. We believe
we will benefit from their accomplishments, and specifically their current and recent activities with companies that have a connection
to the Asian market, in identifying attractive acquisition opportunities. However, there is no assurance that we will complete a business
combination.
Investment
Criteria
Our
management team intends to focus on creating shareholder value by leveraging its experience in the management, operation and financing
of businesses to improve the efficiency of operations while implementing strategies to scale revenue organically and/or through acquisitions.
We have identified the following general criteria and guidelines, which we believe are important in evaluating prospective target businesses.
While we intend to use these criteria and guidelines in evaluating prospective businesses, we may deviate from these criteria and guidelines
should we see justification to do so.
● Middle-Market
Growth Business. We will primarily seek to acquire one or more growth businesses with a total enterprise value of between $300,000,000
and $600,000,000. We believe that there are a substantial number of potential target businesses within this valuation range that can
benefit from new capital for scalable operations to yield significant revenue and earnings growth. We currently do not intend to acquire
either a start-up company (a company that has not yet established commercial operations) or a company with negative cash flow.
● Companies
in Business Segments that are Strategically Significant to the Asian Markets. We will seek to acquire those businesses that are
currently strategically significant in the Asian markets. Such sectors include clean energy, internet and high technology, financial
technology, health care, consumer and retail, energy and resources, manufacturing and education.
● Business
with Revenue and Earnings Growth Potential. We will seek to acquire one or more businesses that have the potential for significant
revenue and earnings growth through a combination of both existing and new product development, increased production capacity, expense
reduction and synergistic follow-on acquisitions resulting in increased operating leverage.
● Companies
with Potential for Strong Free Cash Flow Generation. We will seek to acquire one or more businesses that have the potential to
generate strong, stable and increasing free cash flow. We intend to focus on one or more businesses that have predictable revenue streams
and definable low working capital and capital expenditure requirements. We may also seek to prudently leverage this cash flow in order
to enhance shareholder value.
● Benefit
from Being a Public Company. We intend to only acquire a business or businesses that will benefit from being publicly traded
and which can effectively utilize access to broader sources of capital and a public profile that are associated with being a publicly
traded company.
These
criteria are not intended to be exhaustive or exclusive. Any evaluation relating to the merits of a particular business combination may
be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our sponsor
and management team may deem relevant. In the event that we decide to enter into an 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 business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation
or tender offer materials, as applicable, that we would file with the United States Securities and Exchange Commission, or the SEC. In
evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings
with incumbent ownership, management and employees, document reviews, interviews of customers and suppliers, inspections of facilities,
as well as reviewing financial and other information which will be made available to us.
Our
management team continues to actively source target candidates where they believe will be attractive candidates for acquisition, utilizing
their deal-making track record, professional relationships, and capital markets expertise to enhance the growth potential and value of
a target business and provide opportunities for an attractive return to our stockholders.
Sourcing
of Potential Business Combination Targets
Our
management team has developed a broad network of contacts and corporate relationships. We believe that the network of contacts and relationships
of our management team and our sponsor will provide us with an important source of business combination opportunities. In addition, we
anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment banking
firms, private equity firms, consultants, accounting firms and business enterprises. We are not prohibited from pursuing an initial business
combination with a company that is affiliated with our sponsor, officers or directors, or completing the business combination through
a joint venture or other form of shared ownership with our sponsor, officers or directors.
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 then-existing fiduciary or contractual obligations, he or she may be required to present such business combination
opportunity to such entity prior to presenting such business combination opportunity to us.
Unless
we complete our initial business combination with an affiliated entity, or our Board of Directors cannot independently determine the
fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking
firm, another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an
independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion
is obtained, our shareholders will be relying on the business judgment of our Board of Directors, which will have significant discretion
in choosing the standard used to establish the fair market value of the target or targets, and different methods of valuation may vary
greatly in outcome from one another. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials,
as applicable, related to our initial business combination.
Members
of our management team may directly or indirectly own our ordinary shares and/or private placement units following our initial public
offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business
with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest
with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included
by a target business as a condition to any agreement with respect to our initial business combination.
Each
of our directors and officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or
contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities
to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes
aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations,
he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity,
and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will
provide that, subject to his or her fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity
offered to any officer or director 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. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers
would materially undermine our ability to complete our business combination.
Our
officers and directors are not prohibited from becoming an officer or director of another special purpose acquisition company with a
class of securities registered under the Securities Exchange Act of 1934, as amended.
Competition
In
identifying, evaluating and selecting a target business for our initial 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 us. Our ability to acquire larger target businesses
will be limited by our available financial resources. 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 shareholders who exercise their
redemption rights may reduce the resources available to us for our initial business combination and our outstanding rights and
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.
We
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. In
this situation, the owners of the target business would exchange their shares of stock in the target business for our shares or for a
combination of our shares and cash, allowing us to tailor the consideration to the specific needs of the sellers. Although 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.
Furthermore,
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. Once public, we believe the target business would then have greater access to capital and
an additional means of providing management incentives consistent with shareholders’ interests. It can offer further benefits by
augmenting a company’s profile among potential new customers and vendors and aid in attracting talented employees.
While
we believe that our structure and our management team’s backgrounds will make us an attractive business partner, some potential
target businesses may have a negative view of us since we are a blank check company, without an operating history, and there is uncertainty
relating to our ability to obtain shareholder approval of our proposed initial business combination and retain sufficient funds in our
trust account in connection therewith.
Initial
Business Combination Timeframe and Nasdaq Rules
We
will have until 9 months from December 15, 2021 (the closing of our IPO) to consummate our initial business combination. However, if we
anticipate that we may not be able to consummate our initial business combination within 9 months, we may, by resolution of our board
if requested by our sponsor, extend the period of time to consummate a business combination up to twelve times, each by an additional month
(for a total of up to 21 months to complete a business combination), subject to the sponsor depositing additional funds into the trust
account as set out below. Pursuant to the terms of our memorandum and articles of association and the trust agreement entered into between
us and Wilmington Trust, National Association and Vstock Transfer LLC in connection with our IPO, in order for the time available for
us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees, upon five days advance
notice prior to the applicable deadline, must deposit into the trust account $383,332, ($0.033 per public share), up to an aggregate
of $4,600,000, or $0.40 per public share, on or prior to the date of the applicable deadline, for each monthly extension. In the event
that we receive notice from our sponsor five days prior to the applicable deadline of its wish for us to effect an extension, we intend
to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue
a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and
its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination.
If we are unable to consummate our initial business combination within the applicable time period, we will, as promptly as reasonably
possible but not more than ten business days thereafter, redeem the public shares for a pro rata portion of the funds held in the trust
account and as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our
board of directors, dissolve and liquidate, subject in each case to our obligations under Cayman Islands law to provide for claims of
creditors and the requirements of other applicable law. In such event, the rights and warrants will be worthless.
The
NASDAQ rules require that our initial business combination must be with one or more target businesses that together have an aggregate
fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting commissions and taxes payable
on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. If our Board
of Directors 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 or another independent firm that commonly renders valuation opinions for the type of company
we are seeking to acquire or an independent accounting firm. We do not intend to purchase multiple businesses in unrelated industries
in conjunction with our initial business combination. Additionally, pursuant to NASDAQ rules, any initial business combination must be
approved by a majority of our independent directors.
We
anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares
will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial
business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target
business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete
such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target
or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company
under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires
50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority
interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction.
For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding
capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance
of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority
of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target
business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned
or acquired is what will be valued for purposes of the 80% of net assets test. If our initial business combination involves more than
one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses.
Summary
Information Related to Our Securities, Redemption Rights and Liquidation
We
are a Cayman Islands exempted company (company number 373150) and our affairs are governed by our amended and restated memorandum and
articles of association, the Companies Law and common law of the Cayman Islands. Pursuant to our amended and restated memorandum and
articles of association which will be adopted upon the consummation of our initial public offering, we will be authorized to issue 50,000,000
ordinary shares, $0.001 par value each. The information provided below is a summary only and we refer you to our prospectus dated as
of December 14, 2021, our amended and restated memorandum and articles of association and our warrant agreement with Vstock Transfer
LLC Company as warrant agent for additional important and material information.
In
our initial public offering, we sold units at an offering price of $10.00 and consisting of one ordinary share, one right to receive
one-seventh (1/7) of an ordinary share upon the consummation of an initial business combination and one redeemable warrant. Each warrant
entitles the holder thereof to purchase one-half of one ordinary share. We will not issue fractional shares in connection with the exercise
of the warrants. As a result, a warrant holder must exercise warrants in multiples of two warrants, at a price of $11.50 per full share,
subject to adjustment. Each warrant will become exercisable on the later of the completion of an initial business combination and 9 months
from December 15, 2021 and will expire five years after the completion of an initial business combination, or earlier upon redemption.
Effective January 18, 2022, the component parts of the units began trading separately.
As
of December 31, 2021, there were 14,705,000 ordinary shares issued and outstanding. Ordinary shareholders of record are entitled to one
vote for each share held on all matters to be voted on by shareholders and vote together as a single class, except as required by law.
Unless specified in the Companies Law, our amended and restated memorandum and articles of association or applicable stock exchange rules,
the affirmative vote of a majority of our ordinary shares that are voted is required to approve any such matter voted on by our shareholders.
As
of December 31, 2021, there are warrants outstanding to acquire and aggregate of 5,750,000 ordinary shares. We will not be obligated
to deliver any ordinary shares pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless
a registration statement under the Securities Act with respect to the ordinary shares underlying the warrants is then effective and a
prospectus relating thereto is current, subject to our satisfying our obligations described below with respect to registration. No warrant
will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise
their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state
of the exercising holder, or an exemption is available. In the event that the conditions in the two immediately preceding sentences are
not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant and such warrant may
have no value and expire worthless. In the event that a registration statement is not effective for the exercised warrants, the purchaser
of a unit containing such warrant will have paid the full purchase price for the unit solely for the ordinary share underlying such unit.
Once the warrants become exercisable, we may call the warrants for redemption (including the private placement warrants but including any outstanding warrants issued upon exercise of the unit purchase option issued to the underwriters or their designees):
● in
whole and not in part;
● at
a price of $0.01 per warrant;
● upon
not less than 30 days’ prior written notice of redemption (the “30-day redemption period”) to each warrant holder;
and
● if,
and only if, the reported last sale price of the ordinary shares equal or exceed $18.00 per share (as adjusted for share splits, share
capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading
day period ending on the third trading day prior to the date we send to the notice of redemption to the warrant holders.
We
will provide our public shareholders with the opportunity to redeem all or a portion of their ordinary shares upon the completion of
our initial business combination either (i) in connection with a shareholder meeting called to approve the business combination
or (ii) by means of a tender offer. The decision as to whether we will seek shareholder 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, whether the terms of the transaction would require us to seek shareholder approval under the law or stock exchange
listing requirement or whether we were deemed to be a foreign private issuer (which would require that we conduct a tender offer under
SEC rules rather than seeking shareholder approval). Under NASDAQ rules, asset acquisitions and stock purchases would not typically
require shareholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than
20% of our issued and outstanding ordinary shares (unless we are deemed to be a foreign private issuer at such time) or seek to amend
our amended and restated memorandum and articles of association would require shareholder approval. We intend to conduct redemptions
without a shareholder vote pursuant to the tender offer rules of the SEC unless shareholder approval is required by law or stock
exchange listing requirement or we choose to seek shareholder approval for business or other legal reasons. So long as we obtain and
maintain a listing for our securities on the NASDAQ, we will be required to comply with NASDAQ rules.
We
will provide our public shareholders with the opportunity to redeem all or a portion of their ordinary shares 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 prior to the consummation of the initial business combination, including interest (which interest shall be net
of taxes payable) divided by the number of then issued and outstanding public shares, subject to the limitations described herein. The
amount in the trust account is initially anticipated to be approximately $10.00 per public share (subject to increase of up to an additional
$0.40 per public share in the event that our sponsor elects to extend the period of time to consummate a business combination). 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 their founder shares, private placement shares and any public shares
they may hold in connection with the completion of our initial business combination.
Our
amended and restated memorandum and articles of association 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 either immediately prior to or upon consummation of our initial business
combination (so that we are not subject to the SEC’s “penny stock” rules). Redemptions of our public shares may also
be subject to a higher net tangible asset test or cash requirement pursuant to an 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 ordinary shares 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 ordinary shares submitted for redemption will be returned to the holders thereof.
Our
sponsor, officers and directors have agreed that we will have only 9 months from the closing of our initial public offering
(December 15, 2021) (or up to 21 months from the closing of our initial public offering if we extend the period of time to
consummate a business combination,) to complete our initial business combination. If we are unable to complete our initial business
combination within such 9-month (or up to 21-month) 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 (less
up to $50,000 of interest to pay dissolution expenses (which interest shall be net of taxes payable) divided by the number of then
issued and outstanding public shares, which redemption will completely extinguish public shareholders’ rights as shareholders
(including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as
reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors,
liquidate and dissolve, subject in each case to our obligations under Cayman Islands 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 rights and
warrants, which will expire worthless if we fail to complete our initial business combination within the 9-month (or up to 21-
month) time period.
Corporate
Information
We
are an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended, or the
Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As 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 of 2002, or 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 shareholder 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 volatile.
In
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.
In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards
would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.
We
will remain an emerging growth company until the earlier of (1) the last day of the fiscal year following the fifth anniversary
of the completion of our IPO, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we
are deemed to be a large accelerated filer, which means the market value of our ordinary shares that is held by non-affiliates exceeds
$700 million as of the prior June 30th, 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. References herein to “emerging growth company” shall have the meaning
associated with it in the JOBS Act.
Additionally,
we are a “smaller reporting company” as defined in Rule 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
statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our
ordinary shares held by non-affiliates exceeds $250 million as of the prior June 30th, or (2) our annual revenues exceed $100
million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as
of the prior June 30.
We
are a Cayman Islands exempted company incorporated on March 11, 2021. Our executive offices are located at 80 Broad Street, 5th
Floor, New York, NY, 10004, and our telephone number is (212) 837 7977.

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ITEM 1A. RISK FACTORS
Item
1A. RISK FACTORS
As
a smaller reporting company, we are not required to include risk factors in this Annual Report. However, below is a partial list of material
risks, uncertainties and other factors that could have a material effect on the Company and its operations:
We
are a blank check company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve
our business objective.
We
are a blank check company established under the laws of the Cayman Islands with no operating results, and we commenced operations
only after the closing of our initial public offering. Because we lack an operating history, you have no basis upon which to evaluate
our ability to achieve our business objective of completing our initial business combination with one or more target businesses. We have
no plans, arrangements or understandings with any prospective target business concerning a business combination and may be unable to
complete our initial business combination. If we fail to complete our initial business combination, we will never generate any operating
revenues.
COVID-19
and its impact on businesses and financial markets could have a material adverse effect on our search for a business combination and
any target business with which we ultimately consummate a business combination.
The
COVID-19 coronavirus pandemic has resulted in a widespread health crisis that has adversely impacted the economies and financial markets
worldwide, business operations and the conduct of commerce generally. There is no way of being certain how long these adverse impacts
will last. The coronavirus, or other disease outbreaks, could have a material adverse effect on the business of any potential target
business with which we consummate a business combination. Furthermore, we may be unable to complete a business combination if concerns
relating to the coronavirus pandemic continue to restrict travel, limit the ability to have meetings with potential investors or the
target company’s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely
manner. The extent to which the coronavirus pandemic impacts our search for a business combination will depend on future developments,
which are highly uncertain and cannot be predicted, including new information which may emerge concerning the coronavirus pandemic and
the actions to contain it or treat its impact, among others. If the disruptions posed by the coronavirus or other matters of global concern
continue for an extensive period of time, it could have a material adverse effect on our ability to consummate a business combination,
or the operations of a target business with which we ultimately consummate a business combination.
In
addition, our ability to consummate a business combination may be dependent on the ability to raise equity and debt financing and the
coronavirus pandemic and other related events could have a material adverse effect on our ability to raise adequate financing, including
as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable
to us or at all.
In
addition, our ability to consummate a transaction may be dependent on the ability to raise equity and debt financing which may be impacted
by COVID-19 and other events, including as a result of increased market volatility and decreased market liquidity and third-party financing
being unavailable on terms acceptable to us or at all.
The
occurrence of natural disasters may adversely affect our business, financial condition and results of operations following our business
combination.
The
occurrence of natural disasters, including hurricanes, floods, earthquakes, tornadoes, fires and pandemic disease may adversely affect
our business, financial condition or results of operations following our business combination. The potential impact of a natural disaster
on our results of operations and financial position is speculative, and would depend on numerous factors. The extent and severity of
these natural disasters will determine their effect on a given economy. Although the long term effect of diseases such as the H5N1 “avian
flu,” or H1N1, the swine flu, cannot currently be predicted, previous occurrences of avian flu and swine flu had an adverse effect
on the economies of those countries in which they were most prevalent. An outbreak of a communicable disease could adversely affect our
business, financial condition and results of operations following our business combination. We cannot assure you that natural disasters
will not occur in the future or that its business, financial condition and results of operations will not be adversely affected.
U.S.
laws in the future may restrict or eliminate our ability to complete a business combination with certain companies.
Future
developments in U.S. laws may restrict our ability or willingness to complete certain business combinations with companies. For instance,
the federal government has recently proposed legislation that would restrict our ability to consummate a business combination with a
target business unless that business met certain standards of the Public Company Accounting Oversight Board (United States), or PCAOB,
and would require delisting of a company from national securities exchanges if it failed to retain an accounting firm that the PCAOB
has inspected to the satisfaction of the SEC. Such proposed legislation would also require public companies to disclose whether they
are owned or controlled by a foreign government, specifically those based in China. We may not be able to consummate a business combination
with a favored target business due to these laws. Furthermore, the documentation we may be required to submit to the SEC proving certain
beneficial ownership requirements and establishing that we are not owned or controlled by a foreign government in the event that we use
a foreign public accounting firm not subject to inspection by the PCAOB or where the PCAOB is unable to completely inspect or investigate
our accounting practices or financial statements because of a position taken by an authority in the foreign jurisdiction could be onerous
and time consuming to prepare.
Our
public shareholders may not be afforded an opportunity to vote on our proposed business combination, which means we may complete our
initial business combination even though a majority of our public shareholders does not support such a combination.
We
may not hold a shareholder vote to approve our initial business combination unless the business combination would require shareholder
approval under applicable Cayman Islands law or the rules of the NASDAQ or if we decide to hold a shareholder vote for business
or other reasons. Examples of transactions that would not ordinarily require shareholder approval include asset acquisitions and share
purchases, while transactions such as direct mergers with our company or transactions where we issue more than 20% of our outstanding
shares would require shareholder’s approval. For instance, the NASDAQ rules currently allow us to engage in a tender offer in lieu of a shareholder
meeting but would still require us to obtain shareholder approval if we were seeking to issue more than 20% of our outstanding shares
to a target business as consideration in any business combination. Therefore, if we were structuring a business combination that required
us to issue more than 20% of our outstanding shares, we would seek shareholder approval of such business combination. Except as required
by law or NASDAQ rules, the decision as to whether we will seek shareholder approval of a proposed business combination or will allow
shareholders to sell their shares to us in 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 otherwise require us to seek shareholder
approval. Accordingly, we may consummate our initial business combination even if holders of a majority of the issued and outstanding
ordinary shares do not approve of the business combination we consummate.
If
we seek shareholder approval of our initial business combination, our sponsor, officers and directors have agreed to vote in favor of
such initial business combination, regardless of how our public shareholders vote.
Unlike
other blank check companies in which the initial shareholders agree to vote their founder shares in accordance with the majority of the
votes cast by the public shareholders in connection with an initial business combination, our sponsor, officers and directors have agreed
(and their permitted transferees will agree), pursuant to the terms of a letter agreement entered into with us, to vote any founder shares
and private placement shares held by them, as well as any public shares purchased during or after this offering, in favor of our initial
business combination. We expect that our sponsor and its permitted transferees will own approximately 21.88% of our issued and outstanding
ordinary shares at the time of any such shareholder vote (assuming it does not purchase units in this offering, and taking into account
ownership of the private placement units). As a result, in addition to our initial shareholder’s founder shares, we would need
only 4,147,501 or approximately 36.06% of the 11,500,000 public shares sold in this offering to be voted in favor of a transaction (assuming
all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not
exercised). Accordingly, if we seek shareholder approval of our initial business combination, it is more likely that the necessary shareholder
approval will be received than would be the case if such persons agreed to vote their founder shares in accordance with the majority
of the votes cast by our public shareholders.
Shareholders’
only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your
right to redeem your shares from us for cash, unless we seek shareholder approval of the business combination.
At
the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of one or more
target businesses. Since our Board of Directors may complete a business combination without seeking shareholder approval, public shareholders
may not have the right or opportunity to vote on the business combination, unless we seek such shareholder approval. Accordingly, if
we do not seek shareholder approval, shareholders only opportunity to affect the investment decision regarding a potential business combination
may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in
our tender offer documents mailed to our public shareholders in which we describe our initial business combination.
The
ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business
combination targets, which may make it difficult for us to enter into a business combination with a target.
We
may seek to enter into a business combination transaction agreement with a prospective target that requires as a closing condition that
we have a minimum net worth or a certain amount of cash. If too many public shareholders exercise their redemption rights, we would not
be able to meet such closing condition and, as a result, would not be able to proceed with the business combination. Furthermore, in
no event will we redeem our public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting
commissions, to be less than $5,000,001 either immediately prior to or upon consummation 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. Consequently, if accepting all properly submitted redemption
requests would cause our net tangible assets to be less than $5,000,001 either immediately prior to or upon consummation of our initial
business combination or such greater amount necessary to satisfy a closing condition as described above, we would not proceed with such
redemption and the related business combination and may instead search for an alternate business combination. Prospective targets will
be aware of these risks and, thus, may be reluctant to enter into a business combination transaction with us.
The
ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete
the most desirable business combination or optimize our capital structure.
At
the time we enter into an agreement for our initial business combination, we will not know how many shareholders may exercise their redemption
rights, and therefore we will need to structure the transaction based on our expectations as to the number of shares that will be submitted
for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the
purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust
account to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for
redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust
account or arrange for third party financing. Raising additional third party financing may involve dilutive equity issuances or the incurrence
of indebtedness at higher than desirable levels. The above considerations may limit our ability to complete the most desirable business
combination available to us or optimize our capital structure.
The
ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the probability
that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.
If
our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or
requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful
is increased. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until
we liquidate the trust account. If you are in need of immediate liquidity, you could attempt to sell your shares in the open market;
however, at such time our shares may trade at a discount to the pro rata amount per share in the trust account. In either situation,
you may suffer a material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate
or you are able to sell your shares in the open market.
The
requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage
over us in negotiating a business combination and may decrease our ability to conduct due diligence on potential business combination
targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms
that would produce value for our shareholders.
Any
potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete
our initial business combination within 9 months from the closing of our initial public offering (or up to 21 months from the closing
of our initial public offering if we extend the period of time to consummate a business combination). Consequently, such target business
may obtain leverage over us in negotiating a business combination, knowing that if we do not complete our initial business combination
with that particular target business, we may be unable to complete our initial business combination with any target business. This risk
will increase as we get closer to the timeframe described above. In addition, we may have limited time to conduct due diligence and may
enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.
We
may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all
operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public
shareholders may only receive $10.00 per share, or less than such amount in certain circumstances, and our rights and warrants will
expire worthless.
Our
sponsor, officers and directors have agreed that we must complete our initial business combination within 9 months from the closing
of our initial public offering (or up to 21 months from the closing of our initial public offering if we extend the period of time
to consummate a business combination,). We may not be able to find a suitable target business and complete our initial business
combination within such time period. If we have not completed our initial business combination within such 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 (which interest shall be net of taxes payable, and less up to $50,000 of interest
to pay dissolution expenses) divided by the number of then issued and outstanding public shares, which redemption will completely
extinguish public shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if
any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the
approval of our remaining shareholders and our Board of Directors, liquidate and dissolve, subject in each case to our obligations
under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such case, our public
shareholders may only receive $10.00 per share, and our rights and warrants will expire worthless. In certain circumstances, our
public shareholders may receive less than $10.00 per share on the redemption of their shares.
Our
sponsor may decide not to extend the term we have to consummate our initial business combination, in which case we would cease all
operations except for the purpose of winding up and we would redeem our public shares and liquidate, and the rights and warrants
will be worthless.
We
will have until 9 months from the closing of our initial public offering to consummate our initial business combination. However, if
we anticipate that we may not be able to consummate our initial business combination within 9 months, we may, by resolution of our board
if requested by our sponsor, extend the period of time to consummate a business combination up to twelve times, each by an additional
month (for a total of up to 21 months to complete a business combination), subject to the sponsor depositing additional funds into the
trust account as set out below. In order for the time available for us to consummate our initial business combination to be extended,
our sponsor or its affiliates or designees must deposit into the trust account $383,332 ($0.033 per public share), up to an aggregate
of $4,600,000, or $0.40 per public share, on or prior to the date of the applicable deadline, for each monthly extension. Any such payments
would be made in the form of a loan. The terms of the promissory note to be issued in connection with any such loans have not yet been
negotiated.
Our
sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our
initial business combination. If we are unable to consummate our initial business combination within the applicable time period, we
will, as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares for a pro rata
portion of the funds held in the trust account and as promptly as reasonably possible following such redemption, subject to the
approval of our remaining shareholders and our board of directors, dissolve and liquidate, subject in each case to our obligations
under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the rights
and warrants will be worthless.
If
we seek shareholder approval of our initial business combination, our sponsor, directors, officers, advisors and their affiliates may
elect to purchase shares from public shareholders, which may influence a vote on a proposed business combination and reduce the public
“float” of our ordinary shares.
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares in
privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination,
although they are under no obligation to do so. Please see “Proposed Business - Permitted purchases of our securities”
for a description of how such persons will determine which shareholders to seek to acquire shares from. Such a purchase may include a
contractual acknowledgement that such shareholder, although still the record holder of our shares is no longer the beneficial owner thereof
and therefore agrees not to exercise its redemption rights. In the event that our sponsor, directors, officers, advisors or their affiliates
purchase shares in privately negotiated transactions from public shareholders who have already elected to exercise their redemption rights,
such selling shareholders would be required to revoke their prior elections to redeem their shares. The price per share paid in any such
transaction may be different from the amount per share a public shareholder would receive if it elected to redeem its shares in connection
with our initial business combination. The purpose of such purchases could be to vote such shares in favor of the business combination
and thereby increase the likelihood of obtaining shareholder approval of the business combination or to satisfy a closing condition in
an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our Initial business
combination, where it appears that such requirement would otherwise not be met. This may result in the completion of our initial business
combination that may not otherwise have been possible.
In
addition, if such purchases are made, the public “float” of our ordinary shares and the number of beneficial holders of our
securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our securities on
a national securities exchange.
If
a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or
fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
We
will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial
business combination. Despite our compliance with these rules, if a shareholder fails to receive our tender offer or proxy materials,
as applicable, such shareholder may not become aware of the opportunity to redeem its shares. In addition, the tender offer documents
or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination
will describe the various procedures that must be complied with in order to validly tender or redeem public shares. In the event that
a shareholder fails to comply with these procedures, its shares may not be redeemed.
You
will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your
investment, therefore, you may be forced to sell your public shares, rights or warrants, potentially at a loss.
Our
public shareholders will be entitled to receive funds from the trust account only upon the earlier to occur of: (i) the completion
of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder
vote to amend our amended and restated memorandum and articles of association to (A) 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 9 months from the closing of our initial
public offering (or up to 21 months from the closing of our initial public offering if we extend the period of time to consummate a business
combination,) or (B) with respect to any other provision relating to shareholders’ rights or pre-business combination activity
and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination within 9 months
from the closing of our initial public offering (or up to 21 months from the closing of our initial public offering if we extend the
period of time to consummate a business combination), subject to applicable law and as further described herein. In no other circumstances
will a public shareholder have any right or interest of any kind in the trust account. Accordingly, to liquidate your investment, you
may be forced to sell your public shares, rights or warrants, potentially at a loss.
NASDAQ
may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our securities
and subject us to additional trading restrictions.
Our
units, ordinary shares, rights and warrants are listed on the NASDAQ. We cannot guarantee that our securities will continue to be, listed on
NASDAQ in the future or prior to our initial business combination. In order to continue listing our securities on NASDAQ prior to our
initial business combination, we must maintain certain financial, distribution and stock price levels. Generally, we must maintain a
minimum market value of listed securities of $50 million, a minimum market value of public held shares of $15 million, and a minimum
number of holders of our securities (generally 400 public holders).
If
NASDAQ delists our securities from trading on its exchange and we are not able to list our securities on another national securities
exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material
adverse consequences, including:
● a
limited availability of market quotations for our securities;
● reduced
liquidity for our securities;
● a
determination that our ordinary shares is a “penny stock” which will require brokers trading in our ordinary shares to adhere
to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;
● a
limited amount of news and analyst coverage; and
● a
decreased ability to issue additional securities or obtain additional financing in the future.
The
National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the
sale of certain securities, which are referred to as “covered securities.” Because our units, ordinary shares, rights
and warrants are listed on NASDAQ, our units, ordinary shares, rights and warrants are covered securities. Although the states are
preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is
a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered
securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the sale of
securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check
companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check
companies in their states. Further, if we were no longer listed on NASDAQ, our securities would not be covered securities and we
would be subject to regulation in each state in which we offer our securities, including in connection with our initial business
combination.
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules,
and if you or a “group” of shareholders are deemed to hold in excess of 15% of the ordinary shares sold in our initial public
offering, you will lose the ability to redeem all such shares in excess of 15% of our ordinary shares sold in our initial public offering.
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public
shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder 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 our initial public offering, which we refer to throughout this Form 10-K
as the “Excess Shares.” However, we would not be restricting our shareholders’ ability to vote all of their shares
(including Excess Shares) for or against our initial business combination. Your inability to redeem the Excess Shares will reduce your
influence over our ability to complete our initial business combination and you could suffer a material loss on your investment in us
if you sell Excess Shares in open market transactions. Additionally, you will not receive redemption distributions with respect to the
Excess Shares if we complete our initial business combination. And as a result, you will continue to hold that number of shares exceeding
15% and, in order to dispose of such shares, would be required to sell your shares in open market transactions, potentially at a loss.
Because
of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to
complete our initial business combination. If we are unable to complete our initial business combination, our public shareholders
may receive only approximately $10.00 per share, or less in certain circumstances, on our redemption, and our rights and warrants
will expire worthless.
We
expect to encounter intense competition from other entities having a business objective similar to ours, including private investors
(which may be individuals or investment partnerships), other blank check companies and other entities, domestic and international,
competing for the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have
extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing
services to various industries. Many of these competitors possess greater technical, human and other resources or more local
industry knowledge than we do and our financial resources will be relatively limited when contrasted with those of many of these
competitors. While we believe there are numerous target business, we could potentially acquire with the net proceeds of our initial
public offering and the sale of the private placement units, our ability to compete with respect to the acquisition of certain
target businesses that are sizable will be limited by our available financial resources. This inherent competitive limitation gives
others an advantage in pursuing the acquisition of certain target businesses. Furthermore, if we are obligated to pay cash for the
ordinary shares redeemed and, in the event we seek shareholder approval of our initial business combination, we make purchases of
our ordinary shares, potentially reducing the resources available to us for our initial business combination. Any of these
obligations may place us at a competitive disadvantage in successfully negotiating a business combination. If we are unable to
complete our initial business combination, our public shareholders may receive only approximately $10.00 per share (or less in
certain circumstances) on the liquidation of our trust account and our rights and warrants will expire worthless. In certain
circumstances, our public shareholders may receive less than $10.00 per share on the redemption of their shares.
If
the net proceeds of our initial public offering not being held in the trust account are insufficient to allow us to operate for at least
9 months (or up to 21 months from the closing of our initial public offering if we extend the period of time to consummate a business
combination,), we may be unable to complete our initial business combination.
The
funds available to us outside of the trust account may not be sufficient to allow us to operate for at least 9 months (or up to 21 months
from the closing of our initial public offering if we extend the period of time to consummate a business combination,), assuming that
our initial business combination is not completed during that time. We expect to incur significant costs in pursuit of our acquisition
plans. However, our affiliates are not obligated to make loans to us in the future, and we may not be able to raise additional financing
from unaffiliated parties necessary to fund our expenses. Any such event in the future may negatively impact the analysis regarding our
ability to continue as a going concern at such time.
We
believe that, upon the closing of our initial public offering, the funds available to us outside of the trust account, will be
sufficient to allow us to operate for at least 9 months (or up to 21 months from the closing of our initial public offering if we
extend the period of time to consummate a business combination,); however, we cannot assure you that our estimate is accurate. Of
the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with our
search for a target business. We could also use a portion of the funds as a down payment or to fund a “no-shop”
provision (a provision in letters of intent designed to keep target businesses from “shopping” around for transactions
with other companies on terms more favorable to such target businesses) with respect to a particular proposed business combination,
although we do not have any current intention to do so. If we entered into a letter of intent where we paid for the right to receive
exclusivity from a target business and were subsequently required to forfeit such funds (whether as a result of our breach or
otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence with respect to, a target
business. If we are unable to complete our initial business combination, our public shareholders may receive only approximately
$10.00 per share (or less in certain circumstances) on the liquidation of our trust account and our rights and warrants will expire
worthless. In such case, our public shareholders may only receive $10.00 per share, and our rights and warrants will expire
worthless. In certain circumstances, our public shareholders may receive less than $10.00 per share on the redemption of their
shares.
Our working capital position and the requirement that
we consummate an initial business combination within 21 months after the closing of our IPO give rise to substantial doubt about
our ability to continue as a going concern.
At December 31, 2021, we had approximately $387,858 in cash. We have incurred and we expect to continue to incur significant costs in pursuit of a business combination. Further, we have until September 15, 2022 or September 15, 2023 with extension to consummate a business combination, and it is uncertain that we will be able to consummate a business combination by that date. If a business combination is not consummated by that date, we will commence a mandatory liquidation and subsequent dissolution. These conditions raise substantial doubt about our ability to continue as a going concern for a period of time within one year after the date of our financial statements included in this report. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.
If
the net proceeds of our initial public offering and the sale of the private placement units not being held in the trust account are insufficient,
it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination
and we will depend on loans from our sponsor or management team to fund our search, to pay our taxes and to complete our initial business
combination.
Of
the net proceeds of our initial public offering and the sale of the private placement units, only $682,254 was available to us
initially outside the trust account to fund our working capital requirements. If
we are required to seek additional capital, we would need to borrow funds from our sponsor, management team or other third parties
to operate or may be forced to liquidate. Neither our sponsor, members of our management team nor any of their affiliates is under
any obligation to advance funds to us in such circumstances. Any such advances would be repaid only from funds held outside the
trust account or from funds released to us upon completion of our initial business combination. If we are unable to complete our
initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and
liquidate the trust account. Consequently, our public shareholders may only receive approximately $10.00 per share (or less in
certain circumstances) on our redemption of our public shares, and our rights and warrants will expire worthless. In such case, our
public shareholders may only receive $10.00 per share, and our rights and warrants will expire worthless. In certain circumstances,
our public shareholders may receive less than $10.00 per share on the redemption of their shares.
Subsequent
to the completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment
or other charges that could have a significant negative effect on our financial condition, results of operations and our share price,
which could cause you to lose some or all of your investment.
Even
if we conduct extensive due diligence on a target business with which we combine, we cannot assure you that this diligence will surface
all material issues that may be present inside a particular target business, that it would be possible to uncover all material issues
through a customary amount of due diligence, or that factors outside of the target business and outside of our control will not later
arise. As a result of these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment
or other charges that could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected
risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though
these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature
could contribute to negative market perceptions about our securities or us. In addition, charges of this nature may cause us to violate
net worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue
of our obtaining post-combination debt financing. Accordingly, any shareholders who choose to remain shareholders following the business
combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction
in value.
If
third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received
by shareholders may be less than $10.00 per share.
Our
placing of funds in the trust account may not protect those funds from third-party claims against us. Although 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 for
the benefit of our public shareholders, such parties may not execute such agreements, or even if they execute such agreements they may
not 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
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. In 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. Upon redemption
of our public shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise
of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors
that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount
received by public shareholders could be less than the $10.00 per share initially held in the trust account, due to claims of such creditors.
Our
sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor (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) $10.00 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 the value of the trust assets,
in each case net of the interest which may be withdrawn to pay taxes, 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 our
initial public offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that 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 have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations
and believe that our sponsor’s only assets are securities of our company. Our sponsor may not have sufficient funds available to
satisfy those obligations. We have not asked our sponsor to reserve for such obligations, and therefore, no funds are currently set aside
to cover any such 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 $10.00 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 or directors will indemnify us for claims by third parties including, without limitation,
claims by vendors and prospective target businesses.
Our
directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in
the trust account available for distribution to our public shareholders.
In
the event that the proceeds in the trust account are reduced below the lesser of (i) $10.00 per public share or (ii) such lesser
amount per share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the
trust assets, in each case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy
its 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 in any particular instance. If our independent
directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution
to our public shareholders may be reduced below $10.00 per share.
If,
after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy
petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our Board
of Directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our Board of Directors
and us to claims of punitive damages.
If,
after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy
petition is filed against us that is not dismissed, any distributions received by shareholders 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 all amounts received by our shareholders. In addition, our Board of Directors may be viewed as having breached
its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by
paying public shareholders from the trust account prior to addressing the claims of creditors.
If,
before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy
petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our
shareholders and the per-share amount that would otherwise be received by our shareholders in connection with our liquidation may be
reduced.
If,
before distributing the proceeds in the trust account to our public shareholders, 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 shareholders.
To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our shareholders
in connection with our liquidation may be reduced.
If
we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements
and our activities may be restricted, which may make it difficult for us to complete our initial business combination.
If
we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including:
● restrictions
on the nature of our investments; and
● restrictions
on the issuance of securities;
each
of which may make it difficult for us to complete our initial business combination. In addition, we may have imposed upon us burdensome
requirements, including:
● registration
as an investment company;
● adoption
of a specific form of corporate structure; and
● reporting,
record keeping, voting, proxy and disclosure requirements and other rules and regulations.
We
do not believe that our anticipated principal activities will subject us to the Investment Company Act. The proceeds held in the trust
account may be invested by the trustee only in United States government treasury bills with a maturity of 180 days or less or in money
market funds investing solely in United States Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company
Act. Because the investment of the proceeds will be restricted to these instruments, we believe we will meet the requirements for the
exemption provided in Rule 3a-1 promulgated under the Investment Company Act. If we were deemed to be subject to the Investment
Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds
and may hinder our ability to complete a business combination. If we are unable to complete our initial business combination, our public
shareholders may receive only approximately $10.00 per share, or less in certain circumstances, on the liquidation of our trust account
and our rights and warrants will expire worthless.
Changes
in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, investments and results
of operations.
We
are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply
with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult,
time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and
those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to
comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business and results
of operations.
If
we are unable to consummate our initial business combination within the initial 9 months (or up to 21 months from the closing of our
initial public offering if we extend the period of time to consummate a business combination) of the closing of our initial public offering,
our public shareholders may be forced to wait beyond such 9 months (or up to 21 months) before redemption from our trust account.
If
we are unable to consummate our initial business combination within the initial 9 months (or up to 21 months from the closing of our
initial public offering if we extend the period of time to consummate a business combination,), we will distribute the aggregate amount
then on deposit in the trust account (less up to $50,000 of the net interest earned thereon to pay dissolution expenses), pro rata to
our public shareholders by way of redemption and cease all operations except for the purposes of winding up of our affairs, as further
described herein. Any redemption of public shareholders from the trust account shall be effected automatically by function of our amended
and restated memorandum and articles of association prior to any voluntary winding up. If we are required to windup, liquidate the trust
account and distribute such amount therein, pro rata, to our public shareholders, as part of any liquidation process, such winding up,
liquidation and distribution must comply with the applicable provisions of the Companies Law. In that case, investors may be forced to
wait beyond the initial 9 months (or up to 21 months) before the redemption proceeds of our trust account become available to them and
they receive the return of their pro rata portion of the proceeds from our trust account. We have no obligation to return funds to investors
prior to the date of our redemption or liquidation unless we consummate our initial business combination prior thereto and only then
in cases where investors have sought to redeem their ordinary shares. Only upon our redemption or any liquidation will public shareholders
be entitled to distributions if we are unable to complete our initial business combination.
Our
shareholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption
of their shares.
If
we are forced to enter into an insolvent liquidation, any distributions received by shareholders could be viewed as an unlawful payment
if it was proved that immediately following the date on which the distribution was made, we were unable to pay our debts as they fall
due in the ordinary course of business. As a result, a liquidator could seek to recover all amounts received by our shareholders. Furthermore,
our directors may be viewed as having breached their fiduciary duties to us or our creditors and/or may have acted in bad faith, and
thereby exposing themselves and our company to claims, by paying public shareholders from the trust account prior to addressing the claims
of creditors. We cannot assure you that claims will not be brought against us for these reasons. We and our directors and officers who
knowingly and willfully authorized or permitted any distribution to be paid out of our share premium account while we were unable to
pay our debts as they fall due in the ordinary course of business would be guilty of an offence and may be liable to fines and to imprisonment for five years in the Cayman Islands.
We
may not hold an annual meeting of shareholders until after the consummation of our initial business combination.
In
accordance with NASDAQ corporate governance requirements, we are required to hold an annual meeting no later than one year after our
first fiscal year end following our listing on NASDAQ, unless we continue to be a foreign private issuer. There is no requirement under
the Cayman Islands’ Companies Law for us to hold annual or general meetings or elect directors. Until we hold an annual meeting
of shareholders, public shareholders may not be afforded the opportunity to discuss company affairs with management.
We
are not registering the ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities laws
at this time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor
from being able to exercise its warrants except on a cashless basis and potentially causing such warrants to expire worthless.
We
are not registering the ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities laws
at this time. However, under the terms of the warrant agreement, we have agreed that as soon as practicable, but in no event later than
15 business days after the closing of our initial business combination, we will use our best efforts to file, and within 60 business
days following our initial business combination to have declared effective, a registration statement covering such shares and maintain
a current prospectus relating to the ordinary shares issuable upon exercise of the warrants, until the expiration of the warrants in
accordance with the provisions of the warrant agreement. We cannot assure you that we will be able to do so if, for example, any facts
or events arise which represent a fundamental change in the information set forth in the registration statement or prospectus, the financial
statements contained or incorporated by reference therein are not current or correct or the SEC issues a stop order. If the shares issuable
upon exercise of the warrants are not registered under the Securities Act, we will be required to permit holders to exercise their warrants
on a cashless basis. However, no warrant will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any
shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified
under the securities laws of the state of the exercising holder, or an exemption is available.
Notwithstanding
the foregoing, if a registration statement covering the ordinary shares issuable upon exercise of the warrants is not effective within
a specified period following the consummation of our initial business combination, warrant holders may, until such time as there is an
effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise
warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such
exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants
on a cashless basis. We will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption
is not available. In no event will we be required to net cash settle any warrant, or issue securities or other compensation in exchange
for the warrants in the event that we are unable to register or qualify the shares underlying the warrants under applicable state securities
laws and no exemption is available. If the issuance of the shares upon exercise of the warrants is not so registered or qualified or
exempt from registration or qualification, the holder of such warrant shall not be entitled to exercise such warrant and such warrant
may have no value and expire worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid
the full unit purchase price solely for the ordinary shares included in the units. If and when the warrants become redeemable by us,
we may not exercise our redemption right if the issuance of shares upon exercise of the warrants is not exempt from registration or qualification
under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register
or qualify such shares under the blue sky laws of the state of residence in those states in which the warrants were offered by us in
our initial public offering.
The
grant of registration rights to our sponsor and holders of our private placement units may make it more difficult to complete our initial
business combination, and the future exercise of such rights may adversely affect the market price of our ordinary shares.
Pursuant
to an agreement to be entered into concurrently with the issuance and sale of the securities in our initial public offering, our
sponsor and its permitted transferees can demand that we register their founder shares. In addition, holders of our private
placement units and their permitted transferees can demand that we register the private placement units and their underlying
securities, holders of the shares, and the shares underlying the rights and warrants, can demand that we register such securities, and holders of units that may
be issued upon conversion of working capital loans, may demand that we register such units and their underlying securities. We will
bear the cost of registering these securities. The registration and availability of such a significant number of securities for
trading in the public market may have an adverse effect on the market price of our ordinary shares. In addition, the existence of
the registration rights may make our initial business combination more costly or difficult to conclude. This is because the
shareholders of the target business may increase the equity stake they seek in the combined entity or ask for more cash
consideration to offset the negative impact on the market price of our ordinary shares that is expected when the ordinary shares
owned by our sponsor, holders of our private placement units or holders of our working capital loans or their respective permitted
transferees are registered.
Because
we are not limited to a particular industry or any specific target businesses with which to pursue our initial business combination,
you will be unable to ascertain the merits or risks of any particular target business’s operations.
We
may seek to complete a business combination with an operating company in any industry or sector. However, we will not, under our amended
and restated memorandum and articles of association, be permitted to effectuate our initial business combination with another blank check
company or similar company with nominal operations. Because we have not yet identified or approached any specific target business with
respect to a business combination, there is no basis to evaluate the possible merits or risks of any particular target business’s
operations, results of operations, cash flows, liquidity, financial condition or prospects. To the extent we complete our initial business
combination, we may be affected by numerous risks inherent in the business operations with which we combine. For example, if we combine
with a financially unstable business or an entity lacking an established record of sales or earnings, we may be affected by the risks
inherent in the business and operations of a financially unstable entity. Although our officers and directors will endeavor to evaluate
the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant
risk factors or that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control
and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot
assure you that an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such
opportunity were available, in a business combination target. Accordingly, any shareholders who choose to remain shareholders following
the business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such
reduction in value.
Past
performance by our management team and their respective affiliates may not be indicative of future performance of an investment in us.
Information
regarding performance by, or businesses associated with, our management team and their affiliates is presented for informational purposes
only. Past performance by our management team, including their affiliates’ past performance, is not a guarantee either (i) of
success with respect to any business combination we may consummate or (ii) that we will be able to locate a suitable candidate for
our initial business combination. You should not rely on the historical record of our management team and their affiliates as indicative
of our future performance. Additionally, in the course of their respective careers, members of our management team have been involved
in businesses and deals that were unsuccessful.
We
may seek acquisition opportunities in industries or sectors that may be outside of our management’s areas of expertise.
We
will consider a business combination outside of our management’s areas of expertise if a business combination candidate is presented
to us and we determine that such candidate offers an attractive acquisition opportunity for our company. In the event we elect to pursue
an acquisition outside of the areas of our management’s expertise, our management’s expertise may not be directly applicable
to its evaluation or operations. As a result, our management may not be able to adequately ascertain or assess all of the significant
risk factors. Accordingly, any shareholders who choose to remain shareholders following our initial business combination could suffer
a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value.
Although
we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may
enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target
business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria
and guidelines.
Although
we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business
with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial
business combination with a target that does not meet some or all of these guidelines, such combination may not be as successful as a
combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business
combination with a target that does not meet our general criteria and guidelines, a greater number of shareholders may exercise their
redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a
minimum net worth or a certain amount of cash. In addition, if we are no longer a foreign private issuer and shareholder approval of
the transaction is required by law, or we decide to obtain shareholder approval for business or other legal reasons, it may be more difficult
for us to attain shareholder approval of our initial business combination if the target business does not meet our general criteria and
guidelines. If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.00
per share on the liquidation of our trust account and our rights and warrants will expire worthless.
We
may seek acquisition opportunities with a financially unstable business or an entity lacking an established record of revenue or earnings.
To
the extent we complete our initial business combination with a financially unstable business or an entity lacking an established record
of sales or earnings, we may be affected by numerous risks inherent in the operations of the business with which we combine. These risks
include volatile revenues or earnings and difficulties in obtaining and retaining key personnel. Although our officers and directors
will endeavor to evaluate the risks inherent in a particular target business, we may not be able to properly ascertain or assess all
of the significant risk factors and we may not have adequate time to complete due diligence.
Furthermore,
some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will
adversely impact a target business.
We
are not required to obtain an opinion from an independent investment banking firm or from an independent accounting firm, and consequently,
you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial
point of view.
Unless
we complete our initial business combination with an affiliated entity, or our Board of Directors cannot independently determine the
fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking
firm, another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an
independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion
is obtained, our shareholders will be relying on the business judgment of our Board of Directors, which will have significant discretion
in choosing the standard used to establish the fair market value of the target or targets, and different methods of valuation may vary
greatly in outcome from one another. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials,
as applicable, related to our initial business combination. However, if our Board of Directors is unable to determine the fair value
of an entity with which we seek to complete an initial business combination based on such standards, we will be required to obtain an
opinion as described above.
We
may issue additional ordinary or preference shares to complete our initial business combination or under an employee incentive plan after
completion of our initial business combination. Any such issuances would dilute the interest of our shareholders and likely present other
risks.
Our
amended and restated memorandum and articles of association will authorize the issuance of up to 50,000,000 ordinary
shares, par value $0.001 per share. There are 35,295,000 authorized but unissued ordinary shares available for issuance and there is no preference shares issued and outstanding.
We
may issue a substantial number of additional ordinary shares, and may issue preference shares, in order to complete our initial business
combination or under an employee incentive plan after completion of our initial business combination. However, our amended and restated
memorandum and articles of association will provide, among other things, that prior to our initial business combination, we may not issue
additional ordinary shares that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote
on any initial business combination. The issuance of additional ordinary shares or preference shares:
● may
significantly dilute the equity interest of investors in our initial public offering;
● may
subordinate the rights of holders of ordinary shares if preference shares are issued with rights senior to those afforded our ordinary
shares;
● could
cause a change in control if a substantial number of ordinary shares are issued, which may affect, among other things, our ability
to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and
directors; and
● may
adversely affect prevailing market prices for our units, ordinary shares, rights and/or warrants.
We
may be a passive foreign investment company, or “PFIC,” which could result in adverse U.S. federal income tax consequences
to U.S. investors.
If
we are a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. Holder (as defined in the
section of this prospectus captioned “Income Tax Considerations - Certain U.S. Federal Income Tax Considerations -
U.S. Holders”) of our ordinary shares, rights or warrants, the U.S. Holder may be subject to adverse U.S. federal income tax
consequences and may be subject to additional reporting requirements. Our PFIC status for our current and subsequent taxable years
may depend on whether we qualify for the PFIC start-up exception (see the section of this prospectus captioned “Income Tax
Considerations - Certain U.S. Federal Income Tax Considerations - U.S. Holders - Passive Foreign Investment
Company Rules”). Depending on the particular circumstances the application of the start-up exception may be subject to
uncertainty, and there cannot be any assurance that we will qualify for the start-up exception. Accordingly, there can be no
assurances with respect to our status as a PFIC for our current taxable year or any subsequent taxable year. Our actual PFIC status
for any taxable year, however, will not be determinable until after the end of such taxable year. Moreover, if we determine we are a
PFIC for any taxable year, we will endeavor to provide to a U.S. Holder such information as the Internal Revenue Service
(“IRS”) may require, including a PFIC annual information statement, in order to enable the U.S. Holder to make and
maintain a “qualified electing fund” election, but there can be no assurance that we will timely provide such required
information, and such election would be unavailable with respect to our ordinary shares, rights and warrants in all cases. We urge
U.S. Holders to consult their own tax advisors regarding the possible application of the PFIC rules to holders of our ordinary
shares, rights and warrants.
We
may reincorporate in another jurisdiction in connection with our initial business combination and such reincorporation may result in
taxes imposed on shareholders.
We
may, in connection with our initial business combination and subject to requisite shareholder approval under the Companies Law, reincorporate
in the jurisdiction in which the target company or business is located. The transaction may require a shareholder to recognize taxable
income in the jurisdiction in which the shareholder is a tax resident or in which its members are resident if it is a tax transparent
entity. We do not intend to make any cash distributions to shareholders to pay such taxes. Shareholders may be subject to withholding
taxes or other taxes with respect to their ownership of us after the reincorporation.
Resources
could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate
and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders may
receive only approximately $10.00 per share, or less than such amount in certain circumstances, on the liquidation of our trust account
and our rights and warrants will expire worthless.
We
anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant
agreements, disclosure documents and other instruments will require substantial management time and attention and substantial costs
for accountants, attorneys and others. If we decide not to complete a specific initial business combination, the costs incurred up
to that point for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a
specific target business, we may fail to complete our initial business combination for any number of reasons including those beyond
our control. Any such event will result in a loss to us of the related costs incurred which could materially adversely affect
subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business
combination, our public shareholders may receive only approximately $10.00 per share on the liquidation of our trust account and our
rights and warrants will expire worthless.
We
are dependent upon our officers and directors and their departure could adversely affect our ability to operate.
Our
operations are dependent upon a relatively small group of individuals and, in particular, our officers and directors. We believe that
our success depends on the continued service of our officers and directors, at least until we have completed our initial business combination.
In addition, our officers and directors are not required to commit any specified amount of time to our affairs and, accordingly, will
have conflicts of interest in allocating management time among various business activities, including identifying potential business
combinations and monitoring the related due diligence. We do not have an employment agreement with, or key-man insurance on the life
of, any of our directors or officers. The unexpected loss of the services of one or more of our directors or officers could have a detrimental
effect on us.
Our
ability to successfully effect our initial business combination and to be successful thereafter will be totally dependent upon the efforts
of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively
impact the operations and profitability of our post-combination business.
Our
ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key
personnel in the target business, however, cannot presently be ascertained. Although some of our key personnel may remain with the target
business in senior management or advisory positions following our initial business combination, it is likely that some or all of the
management of the target business will remain in place. While we intend to closely scrutinize any individuals we engage after our initial
business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be
unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources
helping them become familiar with such requirements.
Our
key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination.
These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them
to have conflicts of interest in determining whether a particular business combination is the most advantageous.
Our
key personnel may be able to remain with the company after the completion of our initial business combination only if they are able to
negotiate employment or consulting agreements in connection with the business combination. Such negotiations would take place simultaneously
with the negotiation of the business combination and could provide for such individuals to receive compensation in the form of cash payments
and/or our securities for services they would render to us after the completion of the business combination. The personal and financial
interests of such individuals may influence their motivation in identifying and selecting a target business, subject to his or her fiduciary
duties under Cayman Islands law. However, we believe the ability of such individuals to remain with us after the completion of our initial
business combination will not be the determining factor in our decision as to whether or not we will proceed with any potential business
combination. There is no certainty, however, that any of our key personnel will remain with us after the completion of our initial business
combination. We cannot assure you that any of our key personnel will remain in senior management or advisory positions with us. The determination
as to whether any of our key personnel will remain with us will be made at the time of our initial business combination.
We
may have a limited ability to assess the management of a prospective target business and, as a result, may effect our initial business
combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company.
When
evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the
target business’s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities
of the target’s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities
we suspected. Should the target’s management not possess the skills, qualifications or abilities necessary to manage a public company,
the operations and profitability of the post-combination business may be negatively impacted. Accordingly, any shareholders who choose
to remain shareholders following the business combination could suffer a reduction in the value of their shares. Such shareholders are
unlikely to have a remedy for such reduction in value.
The
officers and directors of an acquisition candidate may resign upon completion of our initial business combination. The departure of a
business combination target’s key personnel could negatively impact the operations and profitability of our post-combination business.
The role of an acquisition candidate’s key personnel upon the completion of our initial business combination cannot be ascertained
at this time. Although we contemplate that certain members of an acquisition candidate’s management team will remain associated
with the acquisition candidate following our initial business combination, it is possible that members of the management of an acquisition
candidate will not wish to remain in place.
Our
officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to
how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial
business combination.
Our
officers and directors are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest
in allocating their time between our operations and our search for a business combination and their other businesses. We do not intend
to have any full-time employees prior to the completion of our initial business combination. Each of our officers is engaged in several
other business endeavors for which he or she may be entitled to substantial compensation and our officers are not obligated to contribute
any specific number of hours per week to our affairs. Our independent directors also serve as officers and board members for other entities.
If our officers’ and directors’ other business affairs require them to devote substantial amounts of time to such affairs
in excess of their current commitment levels, it could limit their ability to devote time to our affairs which may have a negative impact
on our ability to complete our initial business combination.
Certain
of our officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities
similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular
business opportunity should be presented.
Following
the completion of our initial public offering and until we consummate our initial business combination, we intend to engage in the business
of identifying and combining with one or more businesses. Our sponsor and officers and directors are, or may in the future become, affiliated
with other blank check companies like ours or other entities (such as operating companies or investment vehicles) that are engaged in
making and managing investments in a similar business.
Our
officers and directors also may become aware of business opportunities which may be appropriate for presentation to us and the other
entities to which they owe certain fiduciary or contractual duties. Accordingly, they may have conflicts of interest in determining to
which entity a particular business opportunity should be presented. These conflicts may not be resolved in our favor and a potential
target business may be presented to other entities prior to its presentation to us, subject to his or her fiduciary duties under Cayman
Islands law.
Our
officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our
interests.
We
have not adopted a policy that expressly prohibits our directors, officers, security holders or affiliates from having a direct or indirect
pecuniary or financial interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or
have an interest. In fact, we may enter into a business combination with a target business that is affiliated with our sponsor, our directors
or officers, although we do not intend to do so. Nor do we have a policy that expressly prohibits any such persons from engaging for
their own account in business activities of the types conducted by us. Accordingly, such persons or entities may have a conflict between
their interests and ours.
We
may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated
with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest.
In
light of the involvement of our sponsor, officers and directors with other entities, we may decide to acquire one or more businesses
affiliated with our sponsor, officers and directors. Our officers and directors also serve as officers and board members for other entities.
Such entities may compete with us for business combination opportunities. Our sponsor, officers and directors are not currently aware
of any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated, and
there have been no preliminary discussions concerning a business combination with any such entity or entities. Although we will not be
specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined
that such affiliated entity met our criteria for a business combination and such transaction was approved by a majority of our disinterested
directors. Despite our agreement to obtain an opinion from an independent investment banking firm or another independent firm that commonly
renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm, regarding the fairness
to our company from a financial point of view of a business combination with one or more domestic or international businesses affiliated
with our officers, directors or existing holders, potential conflicts of interest still may exist and, as a result, the terms of the
business combination may not be as advantageous to our public shareholders as they would be absent any conflicts of interest.
Since
our sponsor, officers and directors will lose their entire investment in us if our initial business combination is not completed, a conflict
of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination.
On
March 26, 2021, our sponsor purchased an aggregate of 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately
$0.01 per share. Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible.
As such, our sponsor owns approximately 21.88% of our issued and outstanding shares after our initial public offering (assuming it does
not purchase units in our initial public offering and taking into account ownership of the private placement units). The founder shares
will be worthless if we do not complete an initial business combination. In addition, our sponsor has purchased an aggregate of 330,000
private placement units, for a purchase price of $3,300,000 in the aggregate, or $10.00 per unit, that will also be worthless if we do
not complete a business combination.
Each
private placement unit consists of one private placement share, one private placement warrant and one private placement right. Each private placement right will be converted to one seventh (1/7) of one ordinary share upon the closing of the business combination transaction. Each private placement warrant may
be exercised for one-half of one ordinary share at a price of $11.50 per whole share, subject to adjustment as provided herein.
The
founder shares are identical to the ordinary shares included in the units being sold in our initial public offering except that (i) the
founder shares are subject to certain transfer restrictions and (ii) our sponsor, officers and directors have entered into a letter
agreement with us, pursuant to which they have agreed (A) to waive their redemption rights with respect to their founder shares,
private placement shares and public shares in connection with the completion of our initial business combination, (B) to waive their
redemption rights with respect to any founder shares, private placement shares and public shares held by them in connection with a stockholder
vote to approve an amendment to our amended and restated memorandum and articles of association (x) to modify the substance or timing
of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem
100% of our public shares if we have not consummated our initial business combination within the timeframe set forth therein or with
respect to any other provision relating to stockholders’ rights or pre-initial business combination activity and (C) to waive
their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if
we fail to complete our initial business combination within 9 months from the closing of our initial public offering (or up to 21 months
from the closing of our initial public offering if we extend the period of time to consummate a business combination, as described in
more detail in this prospectus) (although they will be entitled to liquidating distributions from the trust account with respect to any
public shares they hold if we fail to complete our initial business combination within the prescribed time frame).
The
personal and financial interests of our officers and directors may influence their motivation in identifying and selecting a target business
combination, completing an initial business combination and influencing the operation of the business following the initial business
combination.
Since
our sponsor, officers and directors may not be eligible to be reimbursed for their out-of-pocket expenses if our initial business combination
is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for
our initial business combination.
At
the closing of our initial business combination, our sponsor, officers and directors, or any of their respective affiliates, will be
reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses
and performing due diligence on suitable business combinations. There is no cap or ceiling on the reimbursement of out-of-pocket expenses
incurred in connection with activities on our behalf. These financial interests of our sponsor, officers and directors may influence
their motivation in identifying and selecting a target business combination and completing an initial business combination.
We
may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely
affect our leverage and financial condition and thus negatively impact the value of our shareholders’ investment in us.
Although
we have no commitments as of the date of this prospectus to issue any notes or other debt securities, or to otherwise incur outstanding
debt following our initial public offering, we may choose to incur substantial debt to complete our initial business combination. We
have agreed that we will not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or
claim of any kind in or to the monies held in the trust account. As such, no issuance of debt will affect the per-share amount available
for redemption from the trust account. Nevertheless, the incurrence of debt could have a variety of negative effects, including:
● default
and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt
obligations;
● acceleration
of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants
that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;
● our
immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;
● our
inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such
financing while the debt security is outstanding;
● our
inability to pay dividends on our ordinary shares;
● using
a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends
on our ordinary shares if declared, expenses, capital expenditures, acquisitions and other general corporate purposes;
● limitations
on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;
● increased
vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
and
● limitations
on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution
of our strategy and other purposes and other disadvantages compared to our competitors who have less debt.
We
may only be able to complete one business combination with the proceeds of our initial public offering and the sale of the private placement
units, which will cause us to be solely dependent on a single business which may have a limited number of products or services. This
lack of diversification may negatively impact our operations and profitability.
Of
the net proceeds from our initial public offering and the sale of the private placement units, $115,000,000 was available to complete
our business combination and pay related fees and expenses (which includes up to approximately $2,875,000 for the payment of deferred
underwriting commissions).
We
may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within
a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business
because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma
financial statements with the SEC that present operating results and the financial condition of several target businesses as if they
had been operated on a combined basis. By completing our initial business combination with only a single entity our lack of diversification
may subject us to numerous economic, competitive and regulatory risks. Further, we would not be able to diversify our operations or benefit
from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete several
business combinations in different industries or different areas of a single industry.
Accordingly,
the prospects for our success may be:
● solely
dependent upon the performance of a single business, property or asset; or
● dependent
upon the development or market acceptance of a single or limited number of products, processes or services.
This
lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial
adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.
We
may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete
our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability.
If
we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers
to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make
it more difficult for us, and delay our ability, to complete our initial business combination. With multiple business combinations, we
could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence
investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations
and services or products of the acquired companies in a single operating business. If we are unable to adequately address these risks,
it could negatively impact our profitability and results of operations.
We
may attempt to complete our initial business combination with a private company about which little information is available, which may
result in a business combination with a company that is not as profitable as we suspected, if at all.
In
pursuing our acquisition strategy, we may seek to effectuate our initial business combination with a privately held company. Very little
public information generally exists about private companies, and we could be required to make our decision on whether to pursue a potential
initial business combination on the basis of limited information, which may result in a business combination with a company that is not
as profitable as we suspected, if at all.
Our
management may not be able to maintain control of a target business after our initial business combination. We cannot provide assurance
that, upon loss of control of a target business, new management will possess the skills, qualifications or abilities necessary to profitably
operate such business.
We
may structure a business combination so that the post-transaction company in which our public shareholders own shares will own less than
100% of the equity interests or assets of a target business, but we will only complete such business combination if the post-transaction
company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest
in the target sufficient for us not to be required to register as an investment company under the Investment Company Act. We will not
consider any transaction that does not meet such criteria. Even if the post-transaction company owns 50% or more of the voting securities
of the target, our shareholders prior to the business combination may collectively own a minority interest in the post business combination
company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue
a transaction in which we issue a substantial number of new ordinary shares in exchange for all of the outstanding capital stock of a
target. In this case, we would acquire a 100% interest in the target. However, as a result of the issuance of a substantial number of
new ordinary shares, our shareholders immediately prior to such transaction could own less than a majority of our issued and outstanding
ordinary shares subsequent to such transaction. In addition, other minority shareholders may subsequently combine their holdings resulting
in a single person or group obtaining a larger share of the company’s stock than we initially acquired. Accordingly, this may make
it more likely that our management will not be able to maintain our control of the target business.
We
do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete
a business combination with which a substantial majority of our shareholders do not agree.
Our
amended and restated memorandum and articles of association will not provide a specified maximum redemption threshold, except that in
no event will we redeem our public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting
commissions, to be less than $5,000,001 either immediately prior to or upon consummation of our initial business combination (such that
we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which may
be contained in the agreement relating to our initial business combination. As a result, we may be able to complete our initial business
combination even though a substantial majority of our public shareholders do not agree with the transaction and have redeemed their shares
or, if we are no longer a foreign private issuer and we seek shareholder approval of our initial business combination and do not conduct
redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into privately negotiated
agreements to sell their shares to our sponsor, officers, directors, advisors or their affiliates. In the event the aggregate cash consideration
we would be required to pay for all ordinary shares 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, all ordinary shares submitted for redemption will be returned to the holders
thereof, and we instead may search for an alternate business combination.
Investors
may view our units as less attractive than those of other blank check companies.
Unlike
other blank check companies that sell units comprised of shares and warrants each to purchase one full share in their initial public
offerings, we are selling units each of which is comprised of one ordinary share, one right to receive one-seventh (1/7) of an ordinary
share upon the consummation of an initial business combination and one redeemable warrant. Each warrant entitles the holder thereof to
purchase one-half of one ordinary share. The rights and warrants will not have any voting rights and will expire and be worthless if
we do not consummate an initial business combination. Furthermore, no fractional shares will be issued upon exercises of the warrants.
As a result, unless you acquire at least two warrants, you will not be able to receive a share upon exercise of your warrants. Accordingly,
investors in our initial public offering will not be issued the same securities as part of their investment as they may have in other
blank check company offerings, which may have the effect of limiting the potential upside value of your investment in our company.
In
order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their
charters and modified governing instruments. We cannot assure you that we will not seek to amend our amended and restated memorandum
and articles of association or governing instruments in a manner that will make it easier for us to complete our initial business combination
that our shareholders may not support.
In
order to effectuate a business combination, blank check companies have, in the past, amended various provisions of their charters and
modified governing instruments. For example, blank check companies have amended the definition of business combination, increased redemption
thresholds and extended the period of time in which it had to consummate a business combination. We cannot assure you that we will not
seek to amend our amended and restated memorandum and articles of association or governing instruments or extend the time in which we
have to consummate a business combination through amending our amended and restated memorandum and articles of association will require
a special resolution of our shareholders as a matter of Cayman Islands law.
The
provisions of our amended and restated memorandum and articles of association that relate to our pre-initial business combination activity
(and corresponding provisions of the agreement governing the release of funds from our trust account), including an amendment to permit
us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation
is substantially reduced or eliminated, may be amended with the approval of holders of at least two-thirds of our ordinary shares who
attend and vote in a general meeting, which is a lower amendment threshold than that of some other blank check companies. It may be easier
for us, therefore, to amend our amended and restated memorandum and articles of association and the trust agreement to facilitate the
completion of an initial business combination that some of our shareholders may not support.
Some
other blank check companies have a provision in their charter which prohibits the amendment of certain of its provisions, including those
which relate to a company’s pre-initial business combination activity, without approval by a certain percentage of the company’s
shareholders. In those companies, amendment of these provisions requires approval by between 90% and 100% of the company’s public
shareholders. Our amended and restated memorandum and articles of association will provide that any of its provisions, including those
related to pre-initial business combination activity (including the requirement to deposit proceeds of our initial public offering and
the private placement of warrants into the trust account and not release such amounts except in specified circumstances, and to provide
redemption rights to public shareholders as described herein and in our amended and restated memorandum and articles of association or
an amendment to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption
or liquidation is substantially reduced or eliminated), but excluding the provision of the articles relating to the appointment of directors,
may be amended if approved by holders of at least two-thirds of our ordinary shares who attend and vote in a general meeting, and corresponding
provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65%
of our ordinary shares. We may not issue additional securities that can vote on amendments to our amended and restated memorandum and
articles of association. Our sponsor, which will beneficially own approximately 21.88% of our ordinary shares upon the closing of our
initial public offering (assuming it does not purchase units in our initial public offering and taking into account ownership of the
private placement units), will participate in any vote to amend our amended and restated memorandum and articles of association and/or
trust agreement and will have the discretion to vote in any manner it chooses. As a result, we may be able to amend the provisions of
our amended and restated memorandum and articles of association which govern our pre-business combination behavior more easily than some
other blank check companies, and this may increase our ability to complete a business combination with which you do not agree. Our shareholders
may pursue remedies against us for any breach of our amended and restated memorandum and articles of association.
Certain
agreements related to our initial public offering may be amended without shareholder approval.
Certain
agreements, including the underwriting agreement relating to our initial public offering, the investment management trust agreement between
us and Wilmington Trust, National Association and Vstock Transfer LLC, the letter agreement among us and our sponsor, officers, directors
and director nominees, the registration rights agreement among us and our sponsor and the administrative services agreement between us
and our sponsor, may be amended without shareholder approval. These agreements contain various provisions that our public shareholders
might deem to be material. For example, the underwriting agreement related to our initial public offering contains a covenant that the
target company that we acquire must have a fair market value equal to at least 80% of the balance in the trust account at the time of
signing the definitive agreement for the transaction with such target business (excluding the deferred underwriting commissions and taxes
payable on the income earned on the trust account) so long as we obtain and maintain a listing for our securities on the NASDAQ. While
we do not expect our board to approve any amendment to any of these agreements prior to our initial business combination, it may be possible
that our board, in exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to
any such agreement in connection with the consummation of our initial business combination. Any such amendment may have an adverse effect
on the value of an investment in our securities.
We
may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target
business, which could compel us to restructure or abandon a particular business combination.
Although
we believe that the net proceeds of our initial public offering and the sale of the private placement units will be sufficient to
allow us to complete our initial business combination, because we have not yet identified any prospective target business we cannot
ascertain the capital requirements for any particular transaction. If the net proceeds of our initial public offering and the sale
of the private placement units prove to be insufficient, either because of the size of our initial business combination, the
depletion of the available net proceeds in search of a target business, the obligation to redeem for cash a significant number of
shares from shareholders who elect redemption in connection with our initial business combination or the terms of negotiated
transactions to purchase shares in connection with our initial business combination, we may be required to seek additional financing
or to abandon the proposed business combination. We cannot assure you that such financing will be available on acceptable terms, if
at all. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination,
we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative
target business candidate. In addition, even if we do not need additional financing to complete our initial business combination, we
may require such financing to fund the operations or growth of the target business. The failure to secure additional financing could
have a material adverse effect on the continued development or growth of the target business. None of our officers, directors or
shareholders is required to provide any financing to us in connection with or after our initial business combination. If we are
unable to complete our initial business combination, our public shareholders may only receive approximately $10.00 per share on the
liquidation of our trust account, and our rights and warrants will expire worthless. In certain circumstances, our public
shareholders may receive less than $10.00 per share on the redemption of their shares.
We
may amend the terms of the warrants in a manner that may be adverse to holders of public warrants with the approval by the holders of
a majority of the then issued and outstanding warrants.
Our
warrants will be issued in registered form under a warrant agreement between Vstock Transfer LLC, as warrant agent, and us. The warrant
agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any
defective provision, but requires the approval by the holders of a majority of the then issued and outstanding warrants (including private
warrants) to make any change that adversely affects the interests of the registered holders of warrants. Accordingly, we may amend the
terms of the warrants in a manner adverse to a holder if holders of a majority of the then issued and outstanding warrants (including
private warrants) approve of such amendment. Although our ability to amend the terms of the public warrants with the consent of a majority
of the then issued and outstanding warrants is unlimited, examples of such amendments could be amendments to, among other things, increase
the exercise price of the warrants, shorten the exercise period or decrease the number of ordinary shares purchasable upon exercise of
a warrant.
We
may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
We
have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of
$0.01 per warrant, provided that the last reported sales price of our ordinary shares equal or exceed $18.00 per share (as adjusted for
share splits, share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading
days within a 30 trading-day period ending on the third trading day prior to the date we send the notice of redemption to the warrant
holders. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares upon exercise
of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such
registration or qualification. We will use our best efforts to register or qualify such shares under the blue sky laws of the state of
residence in those states in which the warrants were offered by us in our initial public offering. Redemption of the outstanding warrants
could force you (i) to exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you
to do so, (ii) to sell your warrants at the then-current market price when you might otherwise wish to hold your warrants or (iii) to
accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially
less than the market value of your warrants. None of the private placement warrants will be redeemable by us so long as they are held
by our sponsor or its permitted transferees.
Our
management’s ability to require holders of our warrants to exercise such warrants on a cashless basis will cause holders to receive
fewer ordinary shares upon their exercise of the warrants than they would have received had they been able to exercise their warrants
for cash.
If
we call our public warrants for redemption after the redemption criteria described elsewhere in this prospectus have been satisfied,
our management will have the option to require any holder that wishes to exercise his warrant (including any warrants held by our sponsor,
officers or directors, other purchasers of our founders’ units, or their permitted transferees) to do so on a “cashless basis.”
If our management chooses to require holders to exercise their warrants on a cashless basis, the number of ordinary shares received by
a holder upon exercise will be fewer than it would have been had such holder exercised his warrant for cash. This will have the effect
of reducing the potential “upside” of the holder’s investment in our company.
Our
warrants and founder shares may have an adverse effect on the market price of our ordinary shares and make it more difficult to effectuate
our initial business combination.
We
have issued, as part of the units offered in our IPO and, simultaneously with the closing of our initial public offering, an
aggregate of 11,830,000 public and private placement units. In each case, the warrants are exercisable to purchase one-half
of one ordinary share at a price of $11.50 per whole share, subject to adjustment as provided herein. Prior to our initial
public offering, our sponsor purchased an aggregate of 2,875,000 founder shares in a private placement. In addition, if our
sponsor makes any working capital loans, up to $1,500,000 of such loans may be converted into units, at the price of $10.00
per unit (which, for example, would result in the holders being issued 150,000 ordinary shares if $1,500,000 of notes were so
converted, as well as 150,000 warrants to purchase 75,000 shares) at the option of the lender and 150,000 rights. Such units
would be identical to the private placement units. To the extent we issue ordinary shares to effectuate a business
transaction, the potential for the issuance of a substantial number of additional ordinary shares upon exercise of these
warrants could make us a less attractive acquisition vehicle to a target business. Any such issuance will increase the number
of issued and outstanding ordinary shares and reduce the value of the ordinary shares issued to complete the business
transaction. Therefore, our warrants and founder shares may make it more difficult to effectuate a business combination or
increase the cost of acquiring the target business. The private placement units are identical to the units sold in our
initial public.
A
provision of our warrant agreement may make it more difficult for us to consummate an initial business combination.
Unlike
some other blank check companies, if
(i) we
issue additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial
business combination at a Newly Issued Price of less than $9.20 per share;
(ii) the
aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available
for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions),
and
(iii) the
Market Value is below $9.20 per share,
then
the exercise price of the warrants will be adjusted to be equal to 115% of the higher of the Market Value and the Newly Issued Price,
and the $18 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market
Value and the Newly Issued Price. This may make it more difficult for us to consummate an initial business combination with a target
business.
The
determination of the offering price of our units and the size of our initial public offering is more arbitrary than the pricing of securities
and size of an offering of an operating company in a particular industry. You may have less assurance, therefore, that the offering price
of our units properly reflects the value of such units than you would have in a typical offering of an operating company.
Prior
to our initial public offering there has been no public market for any of our securities. The public offering price of the units and
the terms of the warrants were negotiated between the underwriters and us. In determining the size of our initial public offering, management
held customary organizational meetings with representatives of the underwriters, both prior to our inception and thereafter, with respect
to the state of capital markets, generally, and the amount the underwriters believed they reasonably could raise on our behalf. Factors
considered in determining the size of our initial public offering, prices and terms of the units, including the ordinary shares and warrants
underlying the units, include:
● the
history and prospects of companies whose principal business is the acquisition of other companies;
● prior
offerings of those companies;
● our
prospects for acquiring an operating business at attractive values;
● a
review of debt to equity ratios in leveraged transactions;
● our
capital structure;
● an
assessment of our management and their experience in identifying operating companies;
● general
conditions of the securities markets at the time of our initial public offering; and
● other
factors as were deemed relevant.
Although
these factors were considered, the determination of our offering price is more arbitrary than the pricing of securities of an operating
company in a particular industry since we have no historical operations or financial results.
Because
we must furnish our shareholders with target business financial statements, we may lose the ability to complete an otherwise advantageous
initial business combination with some prospective target businesses.
The
federal proxy rules require that a proxy statement with respect to a vote on a business combination meeting certain financial significance
tests include historical and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement
disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial
statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United
States of America, or U.S. GAAP, or international financing reporting standards as issued by the International Accounting Standards Board,
or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with the
standards of the PCAOB. These financial statement requirements may limit the pool of potential target businesses we may acquire because
some targets may be unable to provide such statements in time for us to disclose such statements in accordance with federal proxy rules and
complete our initial business combination within the prescribed time frame.
We
are an emerging growth company and a smaller reporting company within the meaning of the Securities Act, and if we take advantage of
certain exemptions from disclosure requirements available to emerging growth companies and smaller reporting companies, this could make
our securities less attractive to investors and may make it more difficult to compare our performance with other public companies.
We
are an “emerging growth company” within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage
of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth
companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of
the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements,
and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any
golden parachute payments not previously approved. As a result, our shareholders may not have access to certain information they may
deem important. We could be an emerging growth company for up to five years, although circumstances could cause us to lose that status
earlier, including if the market value of our ordinary shares held by non-affiliates exceeds $700 million as of any June 30 before
that time, in which case we would no longer be an emerging growth company as of the following December 31. We cannot predict whether
investors will find our securities less attractive because we will rely on these exemptions. If some investors find our securities less
attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would
be, there may be a less active trading market for our securities and the trading prices of our securities may be more volatile.
Further,
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial
accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective
or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such
extended transition period which means that when a standard is issued or revised and it has different application dates for public or
private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new
or revised standard. This may make comparison of our financial statements with another public company which is neither an emerging growth
company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of
the potential differences in accountant standards used.
Additionally,
we are a “smaller reporting company” as defined in Rule 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
statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our
ordinary shares held by non-affiliates exceeds $250 million as of the end of the prior June 30th, or (2) our annual
revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds
$700 million as of the prior June 30th. To the extent we take advantage of such reduced disclosure obligations, it may
also make comparison of our financial statements with other public companies difficult or impossible.
Compliance
obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial
financial and management resources, and increase the time and costs of completing an acquisition.
Section 404
of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report on
Form 10-K for the year ending December 31, 2022. Only in the event we are deemed to be a large accelerated filer or an accelerated
filer will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control
over financial reporting. Further, for as long as we remain an emerging growth company, we will not be required to comply with the independent
registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are a blank
check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public
companies because a target company with which we seek to complete our initial business combination may not be in compliance with the
provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal control of any such
entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition.
Because
we are incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to
protect your rights through the U.S. Federal courts may be limited.
We
are an exempted company incorporated under the laws of the Cayman Islands. As a result, it may be difficult for investors to effect service
of process within the United States upon our directors or officers, or enforce judgments obtained in the United States courts against
our directors or officers.
Our
corporate affairs are governed by our amended and restated memorandum and articles of association, the Companies Law (as the same may
be supplemented or amended from time to time) and the common law of the Cayman Islands. The rights of shareholders to take action against
the directors, actions by minority shareholders and the fiduciary responsibilities of our directors to us under Cayman Islands law are
to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively
limited judicial precedent in the Cayman Islands as well as from English common law, the decisions of whose courts are of persuasive
authority, but are not binding on a court in the Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of
our directors under Cayman Islands law are different from what they would be under statutes or judicial precedent in some jurisdictions
in the United States. In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and
certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law. In addition, Cayman
Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States.
We
have been advised by our Cayman Islands legal counsel that the courts of the Cayman Islands are unlikely (i) to recognize or enforce
against us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of
the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated
upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed
by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in the Cayman Islands of
judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money judgment of a foreign
court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a competent foreign court imposes
upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain conditions are met. For a foreign
judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a liquidated sum, and must not be in
respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the same matter, impeachable on the
grounds of fraud or obtained in a manner, or be of a kind the enforcement of which is, contrary to natural justice or the public policy
of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy). A Cayman Islands Court
may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.
As
a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken
by management, members of the Board of Directors or controlling shareholders than they would as public shareholders of a United States
company.
Provisions
in our amended and restated memorandum and articles of association may inhibit a takeover of us, which could limit the price investors
might be willing to pay in the future for our ordinary shares and could entrench management.
Our
amended and restated memorandum and articles of association will contain provisions that may discourage unsolicited takeover proposals
that shareholders may consider to be in their best interests. These provisions include two-year director terms and the ability of the
Board of Directors to designate the terms of and issue new series of preference shares, which may make more difficult the removal of
management and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities.
After
our initial business combination, it is possible that a majority of our directors and officers will live outside the United States and
all of our assets will be located outside the United States; therefore investors may not be able to enforce federal securities laws or
their other legal rights.
It
is possible that after our initial business combination, a majority of our directors and officers will reside outside of the United States
and all of our assets will be located outside of the United States. As a result, it may be difficult, or in some cases not possible,
for investors in the United States to enforce their legal rights, to effect service of process upon all of our directors or officers
or to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties on our directors and officers
under United States laws.
Risks
Associated with Acquiring and Operating a Business Outside of the United States
If
we effect our initial business combination with a company located outside of the United States, we would be subject to a variety of additional
risks that may negatively impact our operations.
If
we effect our initial business combination with a company located outside of the United States, we would be subject to any special considerations
or risks associated with companies operating in the target business’ home jurisdiction, including any of the following:
● rules and
regulations or currency redemption or corporate withholding taxes on individuals;
● laws
governing the manner in which future business combinations may be effected;
● tariffs
and trade barriers;
● regulations
related to customs and import/export matters;
● longer
payment cycles;
● tax
issues, such as tax law changes and variations in tax laws as compared to the United States;
● currency
fluctuations and exchange controls;
● rates
of inflation;
● challenges
in collecting accounts receivable;
● cultural
and language differences;
● employment
regulations;
● crime,
strikes, riots, civil disturbances, terrorist attacks and wars; and
● deterioration
of political relations with the United States which could result in any number of difficulties, both normal course such as above
or extraordinary such as sanctions being imposed. We may not be able to adequately address these additional risks. If we were unable
to do so, our operations might suffer.
If
our management following our initial business combination is unfamiliar with United States securities laws, they may have to expend time
and resources becoming familiar with such laws, which could lead to various regulatory issues.
Following
our initial business combination, any or all of our management could resign from their positions as officers of the Company, and the
management of the target business at the time of the business combination will remain in place. Management of the target business may
not be familiar with United States securities laws. If new management is unfamiliar with United States securities laws, they may have
to expend time and resources becoming familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory
issues which may adversely affect our operations.
If
we effect a business combination with a company located outside of the United States, the laws applicable to such company will likely
govern all of our material agreements and we may not be able to enforce our legal rights.
If
we effect a business combination with a company located outside of the United States, the laws of the country in which such company operates
will govern almost all of the material agreements relating to its operations. We cannot assure you that the target business will be able
to enforce any of its material agreements or that remedies will be available in this new jurisdiction. The system of laws and the enforcement
of existing laws in such jurisdiction may not be as certain in implementation and interpretation as in the United States. The inability
to enforce or obtain a remedy under any of our future agreements could result in a significant loss of business, business opportunities
or capital. Additionally, if we acquire a company located outside of the United States, it is likely that substantially all of our assets
would be located outside of the United States and some of our officers and directors might reside outside of the United States. As a
result, it may not be possible for investors in the United States to enforce their legal rights, to effect service of process upon our
directors or officers or to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties of our
directors and officers under Federal securities laws.
Because
of the costs and difficulties inherent in managing cross-border business operations after we acquire it, our results of operations may
be negatively impacted following a business combination.
Managing a business, operations, personnel or assets in another country is challenging and costly. Management of the target business that we may hire (whether based abroad or in the U.S.) may be inexperienced in cross-border business practices and unaware of significant differences in accounting rules, legal regimes and labor practices. Even with a seasoned and experienced management team, the costs and difficulties inherent in managing cross-border business operations, personnel and assets can be significant (and much higher than in a purely domestic business) and may negatively impact our financial and operational performance.
Many
countries, and especially those in emerging markets, have difficult and unpredictable legal systems and underdeveloped laws and regulations
that are unclear and subject to corruption and inexperience, which may adversely impact our results of operations and financial condition.
Our
ability to seek and enforce legal protections, including with respect to intellectual property and other property rights, or to defend
ourselves with regard to legal actions taken against us in a given country, may be difficult or impossible, which could adversely impact
our operations, assets or financial condition.
Rules and
regulations in many countries, including some of the emerging markets within the regions we will initially focus, are often ambiguous
or open to differing interpretation by responsible individuals and agencies at the municipal, state, regional and federal levels. The
attitudes and actions of such individuals and agencies are often difficult to predict and inconsistent.
Delay
with respect to the enforcement of particular rules and regulations, including those relating to customs, tax, environmental and
labor, could cause serious disruption to operations abroad and negatively impact our results.
After
our initial business combination, substantially all of our assets may be located in a foreign country and substantially all of our revenue
may be derived from our operations in such country. Accordingly, our results of operations and prospects will be subject, to a significant
extent, to the economic, political and legal policies, developments and conditions in the country in which we operate.
The
economic, political and social conditions, as well as government policies, of the country in which our operations are located could affect
our business. The economies in developing markets we will initially focus on differ from the economies of most developed countries in
many respects. Such economic growth has been uneven, both geographically and among various sectors of the economy and such growth may
not be sustained in the future. If in the future such country’s economy experiences a downturn or grows at a slower rate than expected,
there may be less demand for spending in certain industries. A decrease in demand for spending in certain industries could materially
and adversely affect our ability to find an attractive target business with which to consummate our initial business combination and
if we effect our initial business combination, the ability of that target business to become profitable.
Exchange
rate fluctuations and currency policies may cause a target business’ ability to succeed in the international markets to be diminished.
In
the event we acquire a non-U.S. target, all revenues and income would likely be received in a foreign currency, the dollar equivalent
of our net assets and distributions, if any, could be adversely affected by reductions in the value of the local currency. The value
of the currencies in our target regions fluctuate and are affected by, among other things, changes in political and economic conditions.
Any change in the relative value of such currency against our reporting currency may affect the attractiveness of any target business
or, following consummation of our initial business combination, our financial condition and results of operations. Additionally, if a
currency appreciates in value against the dollar prior to the consummation of our initial business combination, the cost of a target
business as measured in dollars will increase, which may make it less likely that we are able to consummate such transaction.
Because
our business objective includes the possibility of acquiring one or more operating businesses with primary operations in emerging markets
we will focus on, changes in the exchange rate between the U.S. dollar and the currency of any relevant jurisdiction may affect our ability
to achieve such objective. For instance, the exchange rates between the Turkish lira or the Indian rupee and the U.S. dollar has changed
substantially in the last two decades and may fluctuate substantially in the future. If the U.S. dollar declines in value against the
relevant currency, any business combination will be more expensive and therefore more difficult to complete. Furthermore, we may incur
costs in connection with conversions between U.S. dollars and the relevant currency, which may make it more difficult to consummate a
business combination.
Because
foreign law could govern almost all of our material agreements, we may not be able to enforce our rights within such jurisdiction or
elsewhere, which could result in a significant loss of business, business opportunities or capital.
Foreign
law could govern almost all of our material agreements. The target business may not be able to enforce any of its material agreements
or that remedies will be available outside of such foreign jurisdiction’s legal system. The system of laws and the enforcement
of existing laws and contracts in such jurisdiction may not be as certain in implementation and interpretation as in the United States.
Judiciaries in such jurisdiction may also be relatively inexperienced in enforcing corporate and commercial law, leading to a higher
than usual degree of uncertainty as to the outcome of any litigation. As a result, the inability to enforce or obtain a remedy under
any of our future agreements could result in a significant loss of business and business opportunities.
Corporate
governance standards in foreign countries may not be as strict or developed as in the United States and such weakness may hide issues
and operational practices that are detrimental to a target business.
General
corporate governance standards in some countries are weak in that they do not prevent business practices that cause unfavorable related
party transactions, over-leveraging, improper accounting, family company interconnectivity and poor management. Local laws often do not
go far to prevent improper business practices. Therefore, shareholders may not be treated impartially and equally as a result of poor
management practices, asset shifting, conglomerate structures that result in preferential treatment to some parts of the overall company,
and cronyism. The lack of transparency and ambiguity in the regulatory process also may result in inadequate credit evaluation and weakness
that may precipitate or encourage financial crisis. In our evaluation of a business combination we will have to evaluate the corporate
governance of a target and the business environment, and in accordance with United States laws for reporting companies take steps to
implement practices that will cause compliance with all applicable rules and accounting practices. Notwithstanding these intended
efforts, there may be endemic practices and local laws that could add risk to an investment we ultimately make and that result in an
adverse effect on our operations and financial results.
Companies
in foreign countries may be subject to accounting, auditing, regulatory and financial standards and requirements that differ, in some
cases significantly, from those applicable to public companies in the United States, which may make it more difficult or complex to consummate
a business combination. In particular, the assets and profits appearing on the financial statements of a foreign company may not reflect
its financial position or results of operations in the way they would be reflected had such financial statements been prepared in accordance
with U.S. GAAP and there may be substantially less publicly available information about companies in certain jurisdictions than there
is about comparable United States companies. Moreover, foreign companies may not be subject to the same degree of regulation as are United
States companies with respect to such matters as insider trading rules, tender offer regulation, shareholder proxy requirements and the
timely disclosure of information.
Legal
principles relating to corporate affairs and the validity of corporate procedures, directors’ fiduciary duties and liabilities
and shareholders’ rights for foreign corporations may differ from those that may apply in the U.S., which may make the consummation
of a business combination with a foreign company more difficult. We therefore may have more difficulty in achieving our business objective.
A
slowdown in economic growth in the markets that our business target operates in may adversely affect our business, financial condition,
results of operations, the value of its equity shares and the trading price of our shares following our business combination.
Following
the business combination, our results of operations and financial condition may be dependent on, and may be adversely affected by, conditions
in financial markets in the global economy, and, particularly in the markets where the business operates. The specific economy could
be adversely affected by various factors such as political or regulatory action, including adverse changes in liberalization policies,
business corruption, social disturbances, terrorist attacks and other acts of violence or war, natural calamities, interest rates, inflation,
commodity and energy prices and various other factors which may adversely affect our business, financial condition, results of operations,
value of our equity shares and the trading price of our shares following the business combination.
Regional
hostilities, terrorist attacks, communal disturbances, civil unrest and other acts of violence or war may result in a loss of investor
confidence and a decline in the value of our equity shares and trading price of our shares following our business combination.
Terrorist
attacks, civil unrest and other acts of violence or war may negatively affect the markets in which we may operates our business following
our business combination and also adversely affect the worldwide financial markets. In addition, the countries we will focus on, have
from time to time experienced instances of civil unrest and hostilities among or between neighboring countries. Any such hostilities
and tensions may result in investor concern about stability in the region, which may adversely affect the value of our equity shares
and the trading price of our shares following our business combination. Events of this nature in the future, as well as social and civil
unrest, could influence the economy in which our business target operates, and could have an adverse effect on our business, including
the value of equity shares and the trading price of our shares following our business combination.
Any
downgrade of credit ratings of the country in which the company we acquire does business may adversely affect our ability to raise debt
financing following our business combination.
No
assurance can be given that any rating organization will not downgrade the credit ratings of the sovereign foreign currency long-term
debt of the country in which our business target operates, which reflect an assessment of the overall financial capacity of the government
of such country to pay its obligations and its ability to meet its financial commitments as they become due. Any downgrade could cause
interest rates and borrowing costs to rise, which may negatively impact both the perception of credit risk associated with our future
variable rate debt and our ability to access the debt markets on favorable terms in the future. This could have an adverse effect on
our financial condition following our business combination.
Returns
on investment in foreign companies may be decreased by withholding and other taxes.
Our
investments will incur tax risk unique to investment in developing economies. Income that might otherwise not be subject to withholding
of local income tax under normal international conventions may be subject to withholding of income tax in a developing economy. Additionally,
proof of payment of withholding taxes may be required as part of the remittance procedure. Any withholding taxes paid by us on income
from our investments in such country may or may not be creditable on our income tax returns. We intend to seek to minimize any withholding
tax or local tax otherwise imposed. However, there is no assurance that the foreign tax authorities will recognize application of such
treaties to achieve a minimization of such tax. We may also elect to create foreign subsidiaries to effect the business combinations
to attempt to limit the potential tax consequences of a business combination.
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
Some
statements contained in this prospectus are forward-looking in nature. Our forward-looking statements include, but are not limited to,
statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future.
In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including
any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,”
“could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,”
“possible,” “potential,” “predict,” “project,” “should,” “would”
and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not
forward-looking. Forward-looking statements in this prospectus may include, for example, statements about:
● our
ability to complete our initial business combination;
● our
success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business
combination;
● our
officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or
in approving our initial business combination, as a result of which they would then receive expense reimbursements;
● our
potential ability to obtain additional financing to complete our initial business combination;
● our
pool of prospective target businesses;
● the
ability of our officers and directors to generate a number of potential acquisition opportunities;
● our
public securities’ potential liquidity and trading;
● 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; or
● our
financial performance following our initial public offering.
The
forward-looking statements contained in this prospectus are based on our current expectations and beliefs concerning future developments
and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated.
These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions
that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements.
These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors”.
Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may
vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any
forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable
securities laws.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
Item
1B. Unresolved Staff Comments
None

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ITEM 2. PROPERTIES
Item
2. Properties
We
currently maintain our executive offices at 80 Broad Street, 5th Floor, New York, NY 10004. The cost for this space is included
in the $10,000 per month fee that we will pay our sponsor for office space, administrative and support services. We consider our current
office space adequate for our current operations.

---

ITEM 3. LEGAL PROCEEDINGS
Item
3. Legal Proceedings
As
of December 31, 2021, there is no material litigation, arbitration or governmental proceeding currently pending against us or any
members of our management team in their capacity as such.

---

ITEM 4. MINE SAFETY DISCLOSURE
Item
4. Mine Safety Disclosures
Not
Applicable
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
ITEM
5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Our
units are currently traded on The Nasdaq Global Market under the symbol “ALSAU” and started trading on The Nasdaq Global
Market on December 13, 2021. The ordinary shares, rights and warrants and began separate trading on January 18, 2022, under the symbols
“ALSA,” “ALSAR” and “ALSAW” respectively.
Stockholders
of Record
At
December 31, 2021 there were 11,830,000 of our units issued and outstanding by stockholders of record. Assuming all units have been separated into ordinary shares, rights and warrants, at December 31, 2021,
there were 14,705,000 ordinary shares issued and outstanding by stockholders of record, there were 11,830,000
of our rights issued and outstanding by stockholders of record, and there were 11,830,000 warrants issued and outstanding by stockholders
of record. The number of record holders was determined from the records of our transfer agent and does not include beneficial owners
of any of our securities whose securities are held in the names of various security brokers, dealers, and registered clearing agencies.
Dividends
We
have not paid any cash dividends on our shares of ordinary shares to date and do not intend to pay cash dividends prior to the completion
of an initial business combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if
any, capital requirements and general financial condition subsequent to completion of a business combination. The payment of any dividends
subsequent to a business combination will be, subject to the laws of the Cayman Islands, within the discretion of our board of directors
at such time. It is the present intention of our board of directors to retain all earnings, if any, for use in our business operations
and, accordingly, our board of directors does not anticipate declaring any cash dividends in the foreseeable future. In addition, our
board of directors is not currently contemplating and does not anticipate declaring any share dividends in the foreseeable future. Further,
if we incur any indebtedness, our ability to declare dividends may be limited by restrictive covenants we may agree to under the terms
of such indebtedness.
Recent
Sales of Unregistered Securities
None
Securities
Authorized for Issuance Under Equity Compensation Plans
None.
Use
of Proceeds
The
registration statement for our initial public offering was declared effective by the Securities and Exchange Commission on December 13,
2021. We completed our initial public offering on December 15, 2021. In our initial public offering, we sold units at an offering price
of $10.00 and consisting of one ordinary share, one right and one redeemable warrant. Each right entitles the holders thereof to receive
one seventh (1/7) of one ordinary shares upon the consumption of the initial business combination. Each warrant entitles the holder thereof
to purchase one-half of one ordinary share. We will not issue fractional shares in connection with the exercise of the warrants.
In
connection with our initial public offering, we sold 11,500,000 units, generating gross proceeds of $115,000,000. Simultaneously with
the closing of the IPO, pursuant to the Private Placement Units Purchase Agreement by and between the Company and our sponsor, A-Star
Management Corporation, the Company completed the private sale of an aggregate of 330,000 units (the “Private Placement Units”)
to the Sponsor at a purchase price of $10.00 per Private Placement Unit, generating gross proceeds to the Company of $3,300,000.
Transaction
costs related to our IPO amounted to $5,669,696, consisting of $2,300,000 of underwriting fees, $2,875,000 of deferred underwriting fees
and $494,696 of other offering costs. A total of $115,000,000, comprised of $112,700,000 of the proceeds from the IPO (which amount includes
up to $2,875,000 of the underwriter’s deferred discount) and $2,300,000 of the proceeds of the sale of the Private Placement Units,
was placed in a U.S.-based trust account, established by VStock Transfer LLC, our transfer agent and maintained at Wilmington Trust,
National Association, acting as trustee. Except with respect to interest earned on the funds in the trust account that may be released
to the Company to pay its taxes, the funds held in the trust account will not be released from the trust account until the earliest of
(i) the completion of the Company’s initial business combination, (ii) the redemption of any of the Company’s public
shares properly tendered in connection with a shareholder vote to amend the Company’s amended and restated memorandum and articles
of association to (A) modify the substance or timing of its obligation to redeem 100% of the Company’s public shares if it
does not complete its initial business combination within 9 months from the closing of the IPO (or up to 21 months from the closing of
the IPO if we extend the period of time to consummate a business combination), or (B) with respect to any other provision relating
to shareholders’ rights or pre-business combination activity, and (iii) the redemption of the Company’s public shares
if it is unable to complete its initial business combination within 9 months from the closing of the IPO (or up to 21 months from the
closing of the IPO if we extend the period of time to consummate a business combination.
For
the year ended December 31, 2021, net cash generated from the IPO and private placement units and held outside of the trust was
used in operating activities was $142,451. At December 31, 2021, the Company had working capital as $477,051, which exclude amount of $115,000,744 for marketable security held in trust account in current asset, and amount of $2,875,000 for deferred underwriting commission in current liability.

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ITEM 6. SELECTED FINANCIAL DATA
ITEM
6. RESERVED
Not applicable.

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
ITEM
7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The
following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction
with our audited financial statements and the notes related thereto which are included in “Item 8. Financial Statements and Supplementary
Data” of this Annual Report on Form 10-K. Certain information contained in the discussion and analysis set forth below includes
forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements as a
result of many factors, including those set forth under “Special Note Regarding Forward-Looking Statements,” “Item
1A. Risk Factors” and elsewhere in this Annual Report on Form 10-K.
Overview
We
are a blank check company incorporated in the Cayman Islands on March 11, 2021 formed for the purpose of effecting a merger, share exchange,
asset acquisition, share purchase, reorganization or similar Business Combination with one or more businesses. We intend to effectuate
our Business Combination using cash derived from the proceeds of the Initial Public Offering and the sale of the Private Units, our shares,
debt or a combination of cash, shares and debt.
We
expect to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business
Combination will be successful.
Results
of Operations
We
have neither engaged in any operations nor generated any operating revenues to date. Our only activities from inception through December 31,
2021 were organizational activities, those necessary to prepare for the Initial Public Offering, described below, and identifying a target
company for a Business Combination after the Initial Public Offering. We do not expect to generate any operating revenues until after the completion of our initial Business
Combination. We expect to generate non-operating income in the form of interest income on marketable securities held after the Initial
Public Offering. We expect that we will 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 in connection with searching for, and completing, a Business
Combination.
For the year ended December 31,
2021, we had a net loss of $52,509, which consisted of interest income on marketable securities held in the Trust Account of $749 and offset by expense of $53,258.
Liquidity
and Capital Resources
On
December 15, 2021, we consummated the Initial Public Offering of 11,500,000 Units, generating gross proceeds of $115,000,000. Simultaneously
with the closing of the Initial Public Offering, we consummated the sale of 330,000 Private Units to the Sponsor at a price of $10.00
per Private Unit generating gross proceeds of $3,300,000.
Following
the Initial Public Offering and the sale of the Private Units, a total of $115,000,000 was placed in the Trust Account. We incurred $5,669,696
in transaction costs, including $2,300,000 of underwriting fees, $2,875,000 of deferred underwriting fees and $494,696 of other offering
costs.
For the year ended December 31,
2021, net cash used in operating activities was $142,451. Net loss of $52,509 was impacted by interest earned on investments of $749.
At
December 31, 2021, we had investments held in the Trust Account of $115,000,744. We intend to use substantially all of the funds
held in the Trust Account, including any amounts representing interest earned on the Trust Account, excluding deferred underwriting commissions,
to complete our Business Combination. We may withdraw interest from the Trust Account to pay taxes, if any. To the extent that our share
capital or debt is used, in whole or in part, as consideration to complete a Business Combination, the remaining proceeds held in the
Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions
and pursue our growth strategies.
At
December 31, 2021, we had cash of $387,858 held outside of the Trust Account. We intend to use the funds held outside the Trust
Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel
to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate
documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination.
In
order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, our Sponsor or an
affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. Such
Working Capital Loans would be evidenced by promissory notes. If we complete a Business Combination, we may repay such notes out of the
proceeds of the Trust Account released to us. In the event that a Business Combination does not close, we may use a portion of the working
capital held outside the Trust Account to repay such notes, but no proceeds from our Trust Account would be used for such repayment.
Up to $1,500,000 of notes may be convertible into units, at a price of $10.00 per unit, at the option of the lender. The units would
be identical to the Private Units.
In
order to complete a Business Combination, the Company will need to raise additional capital through loans or additional investments from
its Sponsor, stockholders, officers, directors, or third parties. The Company’s officers, directors and Sponsor may, but are not
obligated to, loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion,
to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain additional financing. If the Company
is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but
not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses.
The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. These
conditions raise substantial doubt about the Company’s ability to continue as a going concern if a Business Combination is not
consummated.
Off-Balance
Sheet Financing Arrangements
We
have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2021. We
do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to
as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have
not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments
of other entities, or purchased any non-financial assets.
Contractual
Obligations
We
do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement
to pay the Sponsor a monthly fee of $10,000 for certain general and administrative services, including office space, utilities and administrative
services, provided to the Company. We began incurring these fees on December 15, 2021 and will continue to incur these fees monthly until
the earlier of the completion of a Business Combination or the Company’s liquidation.
The
underwriters are entitled to a deferred fee of two and one-half percent (2.5%) of the gross proceeds of the Initial Public Offering,
or $2,500,000. The deferred fee will be paid in cash upon the closing of a Business Combination from the amounts held in the Trust Account,
subject to the terms of the underwriting agreement.
Critical
Accounting Policies
The
preparation of 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, disclosure
of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual
results could materially differ from those estimates. We have identified the following critical accounting policies:
Warrants
The
Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s
specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards
Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging
(“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet
the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under
ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares and whether the warrant holders could
potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions
for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance
and as of each subsequent quarterly period end date while the warrants are outstanding.
For
issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component
of equity at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants
are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter.
Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations.
Ordinary
Shares Subject to Redemption
We
account for our ordinary shares subject to possible conversion in accordance with the guidance in Accounting Standards Codification (“ASC”)
Topic 480 “Distinguishing Liabilities from Equity.” Ordinary shares subject to mandatory redemption are classified as a liability
instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares 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, ordinary shares are classified as shareholders’ equity. Our
ordinary shares feature certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain
future events. Accordingly, ordinary shares subject to possible redemption are presented at redemption value as commitments and contingencies, outside
of the shareholders’ equity section of our balance sheets.
The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying
value of redeemable ordinary shares to equal the redemption value at the end of each reporting period. Increases or decreases in
the carrying amount of redeemable ordinary shares are affected by charges against additional paid-in capital and accumulated
deficit if additional paid in capital equals to zero.
Net
Loss Per Ordinary Share
Our
statement of operations includes a presentation of income (loss) per share for ordinary shares subject to possible redemption in a manner
similar to the two-class method of income (loss) per share. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered the undistributed income (loss) allocable to both the redeemable shares and non-redeemable shares and the undistributed income (loss) is calculated using the total net loss less any dividends paid. The Company then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable shares. Any remeasurement of the accretion to redemption value of the ordinary shares subject to possible redemption was considered to be dividends paid to the public shareholders.
Offering
Costs Associated with the Initial Public Offering
Offering
costs consist of underwriting, legal, accounting, registration and other expenses incurred through the balance sheet date
that are directly related to the IPO. As of December 31, 2021, offering costs amounted to $5,669,696 consisting of
$2,300,000 of underwriting fees, $2,875,000 of deferred underwriting fees, and $494,696 of other offering costs. The Company
complies with the requirements of ASC 340-10-S99-1 and SEC Staff Accounting Bulletin Topic 5A “Expenses of
Offering”. The Company allocates offering costs between public shares, public rights and public warrants based on the
estimated fair values of public shares, public warrants, and public rights at the date of issuance.
Recent
Accounting Standard
Management
does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material
effect on our financial statements.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item
7A. Quantitative and Qualitative Disclosures about Market Risk
Following
the consummation of our Initial Public Offering, the net proceeds of our Initial Public Offering, including amounts in the Trust Account,
have been invested in U.S. government treasury bills, notes or bonds with a maturity of 180 days or less or in certain money market funds
that invest solely in US treasuries. Due to the short-term nature of these investments, we believe there will be no associated material
exposure to interest rate risk.

---

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item
8. Financial Statements and Supplementary Data
This
information appears following Item 15 of this Report and is included herein by reference.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item
9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.

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ITEM 9A. CONTROLS AND PROCEDURES
Item
9A. Controls and Procedures.
Evaluation
of Disclosure Controls and Procedures
Disclosure
controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed
under the Exchange Act, such as this Report, is recorded, processed, summarized, and reported within the time period specified in the
SEC’s rules and forms. Disclosure controls are also designed with the objective of ensuring that such information is accumulated
and communicated to our management, including the chief executive officer and chief financial officer, as appropriate to allow timely
decisions regarding required disclosure. Our management evaluated, with the participation of our current chief executive officer and
chief financial officer (our “Certifying Officers”), the effectiveness of our disclosure controls and procedures as of December
31, 2021, pursuant to Rule 13a-15(b) under the Exchange Act. Based upon that evaluation, our Certifying Officers concluded that,
as of December 31, 2021, our disclosure controls and procedures were effective.
We
do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and
procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the
disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there
are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure
controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all
our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain
assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated
goals under all potential future conditions.
Management’s
Report on Internal Controls Over Financial Reporting
This
Annual Report on Form 10-K does not include a report of management’s assessment regarding internal control over financial
reporting or an attestation report of our independent registered public accounting firm due to a transition period established by rules of
the SEC for newly public companies.
Changes
in Internal Control over Financial Reporting
There
has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting, as the circumstances that led to the restatement of our financial statements described
in this Report had not yet been identified.

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ITEM 9B. OTHER INFORMATION
Item
9B. Other Information
None

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
Our
current directors and executive officers are as follows:
Name
Age
Title
Zhe
Zhang
Chairman,
Chief Executive Officer and Director
Guojian
Chen
Chief
Financial Officer and Director
Konstantin
A. Sokolov
Director
Xiaofeng
Zhou
Director
Huei-Ching
Huang
Director
Zhe
Zhang serves as our Chairman and Chief Executive Officer since April 2021. From August 2018 to February 2020, Mr. Zhang
served as an independent director of TKK Symphony Acquisition Corporation. Since May 2013, Dr. Zhang has been a Founding Partner
of SIFT Capital, an asset manager licensed by the Securities and Futures Commission (SFC) of Hong Kong and China Securities Regulatory
Commission (CSRC). Since February 2019, Dr. Zhang has also been the CEO of Still Waters Green Technology Limited, an asset
management company based in London, specializing in the development and management of renewable energy and power generation assets. Prior
to that, from January 2000 to April 2013, he was an Executive Director at Goldman Sachs Beijing, where he was a member of the
Supervisory Board of Goldman’s Beijing Office and led multiple overseas acquisitions by Chinese state-owned enterprises and listed
companies. He is experienced with fund formation, equity investment and portfolio management. Before entering the private sector, Dr. Zhang
had spent 14 years with MOFCOM including as a diplomat stationed in Europe. He is licensed as a Responsible Officer for Asset Management
under the SFC of Hong Kong, as well as the licensed to practice as a professional respectively for securities, futures and fund management
in China. Dr. Zhang holds a Ph.D. degree from China University of International Business and Economics, Master degrees from both
Peking University (LL.M.) and Oxford University (Magister Juris), and a Bachelor degree from Shanghai Institute of Foreign Trade (B.A.).
He currently sits on the board of China Oxford Scholarship Fund and is involved in the process for scholarship awardee selection every
year.
Guojian
Chen serves as our Chief Financial Officer and director since March 2021. Mr. Chen serves as an independent director of
Venus Acquisition Corporation since February 2021. Mr. Chen serves as the Secretary of Board of Beijing ChinaReel Art Exchange
Inc. a leading copyright operator focusing on high-quality video content, since May 2020, where he is in charge of investor relations
and corporate finance matters for the company. Mr. Chen served as a director of Beijing Zhongqixinhe Enterprise Management Consulting
Co., Ltd., a financial advisory firm with focuses on financial, real estate and TMT industry from May 2019 to May 2020.
Mr. Chen served as an analyst of Zhongrong Huitong Investment Fund Management (Zhuhai) Co., Ltd. from July 2018 to May 2019.
Mr. Chen received his Bachelor of Management degree from Renmin University of China in 2015, and Master of Finance from the University
of Chinese Academy of Sciences in June 2018.
Xiaofeng
Zhou serves as an independent director since December 2021. Ms. Zhou serves as the Managing Director and founder of Hainan Genyuan
Investment Corp. since October 2020. From September 2019 to October 2020, Ms. Zhou served as Senior Strategic Consultant
for Nanjing Travel Group. Prior to that, from September 2006 to September 2019, Ms. Zhou served director, Vice President
and Secretary of the Board for Tempus International Commercial Services Corp., a company listed in Hong Kong and Shenzhen Stock market.
Ms. Zhou received her LL.B. degree from Shenzhen University in 2004.
Konstantin
A. Sokolov serves as an independent director since December 2021. Mr. Sokolov is the founder and Chairman of Gotthard Investment
AG, which is a private equity firm based in Zurich, Switzerland, focusing on financial services, asset management and global real estate.
Since 2011, Gotthard Investment AG advised and managed multiple investment funds, and partnered with leading Swiss and Lichtenstein banks
to invest globally in energy and real estate assets. Prior to that, Mr. Sokolov served as Managing Director of Centrica plc (British
Gas and Direct Energy). Between 1997 to 2005, Mr. Sokolov served in senior leadership positions at Qwest Communication, Inc.,
a pioneer in fiber optics. Mr. Sokolov holds Executive MBA degree from University of Chicago in 2005 and Master of Mathematics and
Computer Science degree from St. Petersburg State University in 1997.
Huei-Ching
(Tina) Huang serves as an independent director since December 2021. Ms. Huang founded and has served as director of AGC
Capital Securities Pty Ltd since April 2014. AGC Capital is a financial advisory service company based in Sydney and licensed in
Australia. Ms. Huang leads AGC Capital’s operation in Australia and Asia Pacific, primarily focusing on initial public offerings,
funds management, corporate finance, mergers and acquisitions and direct investments. From February 2021 to Present, Ms. Huang
also serve as a director of Wall St. Trust Limited based in Hong Kong, which is a licensed entity of Securities & Futures Commission
of Hong Kong (SFC). Prior to AGC Capital, from February 2012 to May 2013, Ms. Huang worked for KPMG as a director
of Information Risk Management. Ms. Huang received her a LLB degree from School of Law of Soochow University in June 1992.
We believe Ms. Huang is well-qualified to serve as a member of the Board because of her financial experiences in capital markets.
Our
officers are elected by the Board of Directors and serve at the discretion of the Board of Directors, rather than for specific terms
of office. Our Board of Directors is authorized to appoint persons to the offices set forth in our amended and restated memorandum and
articles of association as it deems appropriate. Our amended and restated memorandum and articles of association provides that our officers
may consist of a Chairman, Chief Executive Officer, President, Chief Financial Officer, Vice Presidents, Secretary, Assistant Secretaries,
Treasurer and such other offices as may be determined by the Board of Directors.
Each
of our directors holds office for a two-year term. Subject to any other special rights applicable to the shareholders, any vacancies
on our Board of Directors may be filled by the affirmative vote of a majority of the directors present and voting at the meeting of our
board or by a majority of the holders of our founder shares.
Director
Independence
The
NASDAQ listing standards require that a majority of our Board of Directors be independent. An “independent director” is defined
generally as a person who has no material relationship with the listed company (either directly or as a partner, shareholder or officer
of an organization that has a relationship with the company). We currently have three “independent directors” as defined
in the NASDAQ listing standards and applicable SEC rules prior to completion of our initial public offering. Our board has determined
that each of Messrs. Xiaofeng Zhou, Konstantin A. Sokolov and Huei-Ching (Tina) Huang are independent directors under applicable
SEC and NASDAQ rules. Our independent directors will have regularly scheduled meetings at which only independent directors are present.
Committees
of the Board of Directors
Our
Board of Directors has two standing committees: an audit committee and a compensation committee. Each committee will operate under a
charter that has been approved by our board. Subject to phase-in rules and a limited exception, NASDAQ rules and Rule 10A-3
of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors, and NASDAQ rules require
that the compensation committee of a listed company be comprised solely of independent directors.
The
members of our audit committee are Messrs. Xiaofeng Zhou, Konstantin A. Sokolov and Huei-Ching (Tina) Huang. Mr. Sokolov serves
as chairman of the audit committee. Each member of the audit committee is financially literate and our Board of Directors has determined
that Mr. Sokolov qualifies as an “audit committee financial expert” as defined in applicable SEC rules.
The
members of our Compensation Committee are Messrs. Xiaofeng Zhou, Konstantin A. Sokolov and Huei-Ching (Tina) Huang. Ms. Zhou
serves as chairman of the compensation committee.
The
members of our Nominating Committee are Messrs. Xiaofeng Zhou, Konstantin A. Sokolov and Huei-Ching (Tina) Huang. Ms. Huang
serves as chairman of the Nomination committee.

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ITEM 11. EXECUTIVE COMPENSATION
Item 11.
EXECUTIVE COMPENSATION.
No
executive officer has received any cash compensation for services rendered to us during the year ended December 31, 2021.
No
compensation or fees of any kind, including finder’s, consulting fees and other similar fees, will be paid to our founders, members
of our management team or their respective affiliates, for services rendered prior to, or in order to effectuate the consummation of,
our initial business combination (regardless of the type of transaction that it is). Directors, officers and founders will receive reimbursement
for any out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target businesses,
performing business due diligence on suitable target businesses and business combinations as well as traveling to and from the offices,
plants or similar locations of prospective target businesses to examine their operations. There is no limit on the amount of out-of-pocket
expenses reimbursable by us.
After
completion of our initial business combination, members of our management team who remain with us may be paid employment, consulting,
management or other fees from the combined company with any and all amounts being fully disclosed to stockholders, to the extent then
known, in the proxy solicitation materials furnished to our stockholders. The amount of such compensation may not be known at the time
of a stockholder meeting held to consider an initial business combination, as it will be up to the directors of the post-combination
business to determine executive and director compensation. In this event, such compensation will be publicly disclosed at the time of
its determination in an Exchange Act filing such as Current Report on Form 8-K, as required by the SEC.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The
following table sets forth information regarding the beneficial ownership of our shares of ordinary shares as of December 31, 2021
by:
● each
person known by us to be the beneficial owner of more than 5% of our outstanding shares of ordinary shares;
● each
of our officers and directors; and
● all
of our officers and directors as a group.
Unless
otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all ordinary
shares beneficially owned by them. The following table does not reflect beneficial ownership of the warrants and rights included in the units offered
in our initial public offering or purchased by our sponsor in connection with our initial public offering as these warrants are not exercisable
and these rights are not convertible within 60 days of December 31, 2021 or the date of this Form 10-K.
Name and Address of Beneficial Owner(1) Amount and
Nature of
Beneficial
Ownership(3) Approximate
Percentage of
Outstanding
Shares(3)
A-Star Management Corporation(2) 3,205,000 21.88 %
Zhe Zhang(2) 3,205,000 21.88 %
Guojian Chen(4) - -
Konstantin A. Sokolov(4) - -
Xiaofeng Zhou(4) - -
Huei-Ching Huang(4) - -
Steven Markscheid(4) - -
All directors and officers as a group (6 individuals) 3,205,000 21.88 %
5% or greater beneficial owners
Lighthouse Investment Partners, LLC(5) 981,585 6.68 %
Yakira Partners, LP(6) 790,000 5.37 %
Weiss Asset Management LP(7) 860,000 5.85 %
Space Summit Capital LLC(8) 929,634 8.08 %
Feis Equities LLC(9) 985,830 8.57 %
Saba
Capital Management, L.P.(10) 675,245 5.7 %
* Less
than one percent.
(1) Unless otherwise indicated, the business address of each of the individuals is 80 Broad Street, 5th Floor, New York, New York 10004.
(2) Represents
2,875,000 founder ordinary shares and 330,000 private placement ordinary shares held by A-Star Management Corporation, our sponsor. Mr.
Zhe Zhang, our Chairman and Chief Executive Officer, is the sole director of our sponsor, have voting and dispositive power of the ordinary
shares. The address for our sponsor is Craigmuir Chambers, PO Box 71, Road Town, Tortola, VG 1110 British Virgin Islands.
(3) Based
upon 14,705,000 ordinary shares outstanding. Includes the 330,000 private placement units (and the component parts) purchased by our
sponsor simultaneously with the consummation of our initial public offering.
(4) Such
individual does not beneficially own any of our ordinary shares. However, such individual has a pecuniary interest in our ordinary shares
through his ownership of shares of our sponsor.
(5) Based
on information contained in a Schedule 13G filed on February 14, 2022. Lighthouse serves as the investment manager of MAP 136, MAP 204,
and MAP 214. Because Lighthouse may be deemed to control MAP 136, MAP 204, and MAP 214, as applicable, Lighthouse may be deemed to beneficially
own, and to have the power to vote or direct the vote of, and the power to direct the disposition of the Issuer’s Shares reported
herein.
(6) Based
on information contained in a Schedule 13G filed on February 9, 2022 by Yakira Partners, L.P., Yakira Enhanced Offshore Fund Ltd. and
MAP 136 Segregated Portfolio. Each such entity reported that it has shared power to vote 790,000 units and shared power to dispose of
790,000 units.
(7) Based
on information contained in the Schedule 13G filed on February 7, 2022 by Weiss Asset Management, WAM GP, and Andrew Weiss. Each reporting
person has shared power to vote 860,000 ordinary shares and shared the power to dispose of 860,000 shares. The business address for each
reporting person is 222 Berkeley St., 16th Floor, Boston, Massachusetts 02116.
(8) Based
on information contained in the Schedule 13G/A filed on February 3, 2022 by Space Summit Capital LLC, the reporting entity has sole power
to vote 929,634 share and sole power to dispose 929,634 shares. The business address for the reporting person is 15455 Albright Street,
Pacific Palisades, CA 90272.
(9) Based
on information contained in the Schedule 13G/A filed on January 11, 2022 by Feis Equities LLC, the reporting entity has sole power to
vote 985,830 shares and sole power to dispose 985,830 shares.
(10) Based
on information contained in the Schedule 13G file on December 23, 2021 by Saba Capital Management, L.P., Boaz R. Weinstein and Saba Capital
Management GP, LLC, the reporting person has shares power to vote 675,245 shares and shared power to dispose 675,245 shares.
Our
founders beneficially own approximately 21.88% of the issued and outstanding ordinary shares. Because of the ownership block held by
our founders, officers and directors, such individuals may be able to effectively exercise influence over all matters requiring approval
by our stockholders, including the election of directors and approval of significant corporate transactions other than approval of our
initial business combination.
Our
sponsor, officers and directors are deemed to be our “promoters” as such term is defined under the federal securities laws.
Section 16(a) Beneficial
Ownership Reporting Compliance
Section 16(a) of
the Securities Exchange Act of 1934, as amended, or the Exchange Act, requires our executive officers, directors, and persons who beneficially
own more than 10% of a registered class of our equity securities to file with the Securities and Exchange Commission initial reports
of ownership and reports of changes in ownership of our ordinary shares and other equity securities. These executive officers, directors,
and greater than 10% beneficial owners are required by SEC regulation to furnish us with copies of all Section 16(a) forms
filed by such reporting persons.
Based
solely on our review of such forms furnished to us and written representations from certain reporting persons, we believe that, during
the fiscal year ended December 31, 2021, our directors, executive officers, and ten percent stockholders complied with all Section 16(a) filing
requirements,

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13.
Certain Relationships, and Related Transactions and Director Independence
Certain
Relationships and Related Transactions
April
6, 2021, our sponsor purchased 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.01 per share.
Our sponsor owns approximately 21.88% of our issued and outstanding ordinary shares as of December 31, 2021.
Our
sponsor purchased an aggregate of 330,000 private placement units at a price of $10.00 per unit in a private placement that
was completed simultaneously with the closing of our initial public offering. Each unit consists of one private placement
share, one private placement warrant and one private placement right. Each private placement warrant entitles the holder
upon exercise to purchase one-half of one ordinary share at a price of $11.50 per whole share, subject to adjustment as
provided herein. Each private placement right will be converted to one seventh (1/7) of one ordinary shares upon the
completion of its initial business combination. The private placement units (including the underlying securities) may
not, subject to certain limited exceptions, be transferred, assigned or sold by it until 30 days after the completion of our
initial business combination.
In
connection with the completion of our initial public offering, we entered into an Administrative Services Agreement with our sponsor
pursuant to which we will pay a total of $10,000 per month for office space, administrative and support services to such affiliate. Upon
completion of our initial business combination or our liquidation, we will cease paying these monthly fees. Accordingly, in the event
the consummation of our initial business combination takes the maximum 21 months, our sponsor will be paid a total of $210,000 ($10,000
per month) for office space, administrative and support services and will be entitled to be reimbursed for any out-of-pocket expenses.
Our
sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in
connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business
combinations. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers, directors or
our or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling
on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.
Our
sponsor has agreed to loan us up to $300,000 to be used for a portion of the expenses of our initial public offering. As of the date
of closing our initial public offering, we had borrowed $300,000 under the promissory note with our sponsor. These loans are non-interest
bearing, unsecured and were originally due and payable in connection with our public offering (December 15, 2021). The loan repaid as
$300,000 allotted to the payment of offering expense. Related party loan balance as of December 31, 2021 was nil.
In
addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate
of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete
an initial business combination, we would repay such loaned amounts. In the event that the initial business combination does not close,
we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust
account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit
(which, for example, would result in the holders being issued 150,000 ordinary shares, 150,000 rights and 150,000 warrants to purchase 75,000 shares if $1,500,000 of notes were so converted) at the option of the lender. The units would be identical to the placement units issued
to the initial holder. The terms of such loans by our officers and directors, if any, have not been determined and no written agreements
exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as
we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to
funds in our trust account.
The
holders of the founder shares, private placement units, the shares underlying the warrants underlying the unit purchase option issued
to the underwriters of our initial public offering, and units that may be issued on conversion of working capital loans (and any securities
underlying the private placement units and the working capital loans) are entitled to registration rights pursuant to a registration
rights agreement signed on the effective date of our initial public offering requiring us to register such securities for resale. The
holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities.
In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent
to our completion of our initial business combination and rights to require us to register for resale such securities pursuant to Rule 415
under the Securities Act. We will bear the expenses incurred in connection with the filing of any such registration statements
Director
Independence
The
NASDAQ listing standards require that a majority of our Board of Directors be independent. An “independent director” is defined
generally as a person who has no material relationship with the listed company (either directly or as a partner, shareholder or officer
of an organization that has a relationship with the company). We currently have three “independent directors” as defined
in the NASDAQ listing standards and applicable SEC rules prior to completion of our initial public offering. Our board has determined
that each of Messrs. Xiaofeng Zhou, Konstantin A. Sokolov and Huei-Ching (Tina) Huang are independent directors under applicable
SEC and NASDAQ rules.

---

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item
14. Principal Accountant Fees and Services.
The
following is a summary of fees paid or to be paid to UHY LLP, or UHY, for services rendered.
Audit
Fees. Audit fees consist of fees billed for professional services rendered for the audit of our year-end financial statements and
services that are normally provided by UHY in connection with regulatory filings. The aggregate fees billed by UHY for professional services
rendered for the audit of our annual financial statements, review of the financial information included in our Forms 10-K and Form S-1 for the respective
periods and other required filings with the SEC for the year ended December 31, 2021 is $70,500 in total. The above amounts include interim
procedures and audit fees, as well as attendance at audit committee meetings.
Audit-Related
Fees. Audit-related services consist of fees billed for assurance and related services that are reasonably related to performance
of the audit or review of our financial statements and are not reported under “Audit Fees.” These services include attest
services that are not required by statute or regulation and consultations concerning financial accounting and reporting standards. We
did not pay UHY for consultations concerning financial accounting and reporting standards for the year ended December 31, 2021.
Tax
Fees. We did not pay UHY for tax planning and tax advice for the year ended December 31, 2021.
All
Other Fees. We did not pay UHY for other services for the year ended December 31, 2021.
Pre-Approval
Policy
Our
audit committee was formed upon the consummation of our Initial Public Offering. As a result, the audit committee did not pre-approve
all of the foregoing services, although any services rendered prior to the formation of our audit committee were approved by our board
of directors. Since the formation of our audit committee, and on a going-forward basis, the audit committee has and will pre-approve
all auditing services and permitted non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject
to the de minimis exceptions for non-audit services described in the Exchange Act which are approved by the audit committee prior to
the completion of the audit).
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item
15. Exhibits, Financial Statement Schedules
(a) The
following documents are filed as part of this Form 10-K:
(1) The Financial statements listed on the Financial Statements Table of Contents
Page
Report of Independent Registered Public Accounting Firm (Firm ID: 1195)
Financial Statements:
Balance Sheet
Statement of Operations
Statement of Changes in Stockholders’ Equity (Deficit)
Statement of Cash Flows
Notes to Financial Statements
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and
Stockholders of Alpha Star Acquisition Corporation
Opinion on the Financial Statements
We have audited the accompanying balance sheet of Alpha Star Acquisition Corporation (the Company) as of December 31, 2021, and the related statement of operations, stockholders’ equity, and cash flows as of and for the period from March 11, 2021 to December 31, 2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021, and the results of its operations and its cash flows for the period from March 11, 2021 through December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.
Substantial Doubt about the Company’s Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has no revenue, its business plan is dependent on the completion of a financing transaction and the Company’s cash and working capital as December 31, 2021 are not sufficient to complete its planned activities for the upcoming year. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 1 to the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to that matter.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ UHY LLP
We have served as the Company’s auditor since 2021.
Irvine, California
March 29, 2022
Alpha
Star Acquisition Corporation
Balance
Sheet
As of
December 31,
Assets
Current
assets:
Cash
in escrow $ 387,858
Prepaid
expenses 142,192
Marketable
securities held in trust account 115,000,744
Total
current assets 115,530,794
Total
assets $ 115,530,794
Liabilities
and stockholders’ equity
Current
liabilities:
Accrued
expenses $ 52,999
Deferred
underwriting commissions 2,875,000
Total
current liabilities 2,927,999
Total
liabilities 2,927,999
Commitments
and contingencies
Ordinary
shares subject to possible redemption, 11,500,000 shares at redemption value of $10.00 per share 115,000,000
Stockholders’ equity (deficit):
Ordinary
shares, par value $0.001, authorized 50,000,000 shares; 3,205,000 shares issued and outstanding at December 31, 2021, excluding 11,500,000
shares subject to possible redemption 3,205
Additional
paid-in capital -
Accumulated
deficit (2,400,410 )
Total
stockholders’ deficit (2,397,205 )
Total
liabilities and stockholders’ deficit $ 115,530,794
The
accompanying notes are an integral part of the financial statements.
Alpha
Star Acquisition Corporation
Statement
of Operations
For
the period from March 11, 2021 (inception) to
December 31,
Formation
and operational costs $ 53,258
Loss
from operation costs 53,258
Other income
Interest
income
Total
other income
Loss
before income taxes (52,509 )
Income
tax (benefit) expense -
Net
loss $ (52,509 )
Basic
and diluted weighted average shares outstanding - ordinary shares subject to redemption 660,473
Basic
and diluted net loss per share $ 24.46
Basic
and diluted weighted average shares outstanding - non redeemable ordinary shares 2,893,953
Basic
and diluted net loss per share $ (5.60 )
The
accompanying notes are an integral part of the financial statements.
Alpha
Star Acquisition Corporation
Statement
of Stockholder’s Deficit
For
the period from March 11, 2021 (inception) to December 31, 2021
Ordinary shares Paid-in Accumulated Stockholders’
Shares Amount capital deficit deficit
Balance
at March 11, 2021 (inception) - $ - $ - $ - $ -
Issuance
of founder shares to sponsor 2,875,000 2,875 22,125 - 25,000
Sales of ordinary shares and over-allotment 11,500,000 11,500 114,988,500 - 115,000,000
Underwriters’ compensation - - (5,175,000 ) - (5,175,000 )
Offering
costs - - (494,696 ) - (494,696 )
Sale
of shares to sponsor in private placement 330,000 3,299,670 - 3,300,000
Ordinary shares subject to possible redemption (11,500,000 ) (11,500 ) (100,066,549 ) - (100,078,049 )
Allocation
of offering costs related to redeemable shares - - 4,934,018 - 4,934,018
Accretion
for redeemable shares to redemption value
(17,508,069 ) (2,347,901 ) (19,855,970 )
Net
loss - - - (52,509 ) (52,509 )
Balance
at December 31, 2021 3,205,000 $ 3,205 - (2,400,410 ) $ (2,397,205 )
The
accompanying notes are an integral part of the financial statements.
Alpha
Star Acquisition Corporation
Statement
of Cash Flows
For the
period from
March 11, 2021
(inception) to
December 31,
Cash
flows from operating activities:
Net
loss $ (52,509 )
Adjustments
to reconcile net income (loss) to net cash used in operating activities:
Interest
earned in trust account (749 )
Amortization of prepaid expense 7,808
Net
changes in operating assets & liabilities:
Prepaid
expenses (150,000 )
Accrued
expenses 52,999
Net
cash used in operating activities (142,451 )
Cash
flows from investing activities:
Investment
of cash in trust account (115,000,000 )
Net
cash used in investing activities (115,000,000 )
Cash
flows from financing activities:
Proceeds
from issuance of founder shares to sponsor 25,000
Proceeds from sponsor loan 300,000
Payment of sponsor loan (300,000 )
Proceeds
from sale of private placement unit 3,300,000
Proceeds
from sale of units 115,000,000
Payment
of offering costs (2,794,691 )
Net
cash provided by financing activities 115,530,309
Net
increase in cash and cash equivalents 387,858
Cash
and cash equivalents at beginning of period -
Cash
and cash equivalents at end of period $ 387,858
Supplemental
disclosure of non-cash investing and financing Activities:
Defer underwiring compensation $ 2,875,000
Ordinary stock subject to possible redemption $ 100,078,049
Reclassification
of offering costs related to public shares $ (4,934,018 )
Subsequent measurement of ordinary shares subject to redemption against additional paid-in-capital (“APIC”) and accumulated deficit $ 19,855,970
The
accompanying notes are an integral part of the financial statements.
ALPHA
STAR ACQUISITION CORPORATION
NOTES
TO THE FINANCIAL STATEMENT
Note
1 - Description of Organization and Business Operations
Organization
and General
Alpha
Star Acquisition Corporation (the “Company”) is a blank check company incorporated in the Cayman Islands on March 11,
2021. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization
or similar business combination with one or more businesses (“Business Combination”). The Company has selected December 31
as its fiscal year-end.
Although
the Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination, the Company
intends to focus on businesses that have a connection to the Asian market. The Company is an early stage and emerging growth company
and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.
The
Company’s sponsor is A-Star Management Corporation, a British Virgin Islands incorporated company (the “Sponsor”).
At December 31, 2021, the Company had not yet commenced any operations. All activity through December 31, 2021 relates to the Company’s
formation and initial public offering (“IPO”). The Company will not generate any operating revenues until after the completion
of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds
derived from the Proposed Offering.
The
Company will have 9 months from the closing of the IPO (or up to 21 months from the closing of our initial public offering if we extend the period of time to consummate a business combination) to consummate a Business Combination (the “Combination Period”). If the Company fails to consummate a Business
Combination within the Combination Period, it will trigger its automatic winding up, liquidation and subsequent dissolution pursuant
to the terms of the Company’s amended and restated memorandum and articles of association. As a result, this has the same effect
as if the Company had formally gone through a voluntary liquidation procedure under the Companies Law. Accordingly, no vote would be
required from the Company’s shareholders to commence such a voluntary winding up, liquidation and subsequent dissolution.
The
Company’s IPO was declared effective on December 13, 2021. On December 15, 2021, the
Company consummated the IPO of 11,500,000 units
which includes an additional 1,500,000 units
as a result of the underwriters’ fully exercise of the over-allotment, at $10.00 per
Unit, generating gross proceeds of $115,000,000,
which is described in Note 3.
Concurrently
with the closing of the IPO, the Company consummated the sale of 330,000 units (the “Private Placement”)
at a price of $10.00 per Private Unit in a private placement to A-Star Management Corporation, generating
gross proceeds of $3,300,000, which is described in Note 4.
The
Trust Account
As
of December 15, 2021, a total of $115,682,250 of the net proceeds from the IPO and the Private Placement transaction completed with the
Sponsor was deposited in a trust account established for the benefit of the Company’s public shareholders with Wilmington Trust,
National Association acting as trustee. The amount exceeding $115,000,000, $682,254 had been transfer to the Company’s
escrow cash account as its working capital. At December 31, 2021, the Company had working capital as $477,051, which exclude amount of $115,000,744 for marketable security held in trust account in current asset, and amount of $2,875,000 for deferred underwriting commission in current liability.
The
funds held in the Trust Account will be invested only in United States government treasury bills, bonds or notes having a maturity of
180 days or less, or in money market funds meeting the applicable conditions under Rule 2a-7 promulgated under the Investment Company
Act of 1940 and that invest solely in United States government treasuries. Except with respect to interest earned on the funds held in
the Trust Account that may be released to the Company to pay its income or other tax obligations, the proceeds will not be released from
the Trust Account until the earlier of the completion of a Business Combination or the Company’s liquidation.
Liquidity
and Going Concern
As
of December 31, 2021, the Company had cash $387,858 in its escrow account, and working capital as $477,051, which excludes amount of $115,000,744 for marketable security held in trust account in current asset, and amount of $2,875,000 for deferred underwriting commission in current liability.
The
Company’s liquidity needs to date have been satisfied through a payment of $25,000 from the Sponsor to cover certain expenses
on behalf of the Company in exchange for the issuance of the Founder Shares and the proceeds from the consummation of the Private Placement
not held in the Trust Account to provide working capital needed to identify and seek to consummate a Business Combination.
In
order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain
of the Company’s officers and directors may, but are not obligated to, provide the Company related party loans. As of December
31, 2021, the Company had no borrowings under the related party loans.
If
the Company’s estimate of the costs of identifying a target business, undertaking due diligence and negotiating a Business Combination
are less than the actual amount necessary to do so, the Company may have insufficient funds available to operate our business prior to
our initial Business Combination. Moreover, the Company may need to obtain additional financing either to complete its Business Combination
or because the Company has become obligated to redeem a significant number of its Public Shares upon completion of its Business Combination,
in which case the Company may issue additional securities or incur debt in connection with such Business Combination. In addition, we
have until September 15, 2023 (the “Liquidation Date”) to consummate a business combination.
In
connection with the Company’s assessment of going concern considerations in accordance with Accounting Standards Codification (“ASC”)
205-40, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined
that if the Company is unable to complete a Business Combination by the Liquidation Date, then the Company may cease all operations except
for the purpose of liquidating. The uncertainty surrounding the date for mandatory liquidation and subsequent dissolution raise substantial
doubt about the Company’s ability to continue as a going concern. Management expects to close the Business Combination prior to
the Liquidation Date. If the Company is unable to close the Business Combination or raise additional capital, it may be required to take
additional measures to conserve liquidity, which could include, but not necessarily include or be limited to, curtailing operations,
suspending the pursuit of a potential transaction and reducing overhead expenses. The Company cannot provide any assurance that new financing
will be available to it on commercially acceptable terms or if at all. These conditions raise substantial doubt about the Company’s
ability to continue as a going concern through the Liquidation Date if a Business Combination is not consummated. These financial statements
do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be
necessary should the Company be unable to continue as a going concern.
Management
believes that, on December 31, 2021, the company has insufficient working capital to cover its short term operating needs. The Company
has no revenue before the Business Combination. Its business plan is dependent on the completion of a financing transaction and the Company’s
cash and working capital as December 31, 2021 are not sufficient to complete its planned activities for the upcoming year. These factors raise substantial doubt about the Company's ability to continue as a going concern one year from the date the financial statement is issued.
Note
2 - Summary of Significant Accounting Policies
Basis
of Presentation
The
accompanying financial statement of the Company are presented in U.S. dollars in conformity with accounting principles generally accepted
in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission
(“SEC”).
Emerging
Growth Company
The
Company is an emerging growth company as defined by Section 2(a) of the JOBS Act and it may take advantage of certain exemptions from
various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but no
limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced
disclosures obligations regarding executive compensation in its periodic reports and proxy statements, and exceptions from the requirements
of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payment not previously
approved.
Further,
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting
standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do
not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
that apply to non-emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out
of such extended transition period which means that when a standard is issued or revised, and it has different application dates for
public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies
adopt the new or revised standard. This may make comparison of the Company’s financial statement with another public company which
is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult
or impossible because of the potential differences in accounting standards used.
Use
of Estimates
The
preparation of financial statement in conformity with GAAP requires the Company’s management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statement and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Making
estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of
a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating
its estimate, could change in the near term due to one or more future confirming events. One of the more significant accounting estimates
included in these financial statements is the determination of the fair value of the warrant and forward contract derivative liabilities.
Accordingly, the actual results could differ significantly from those estimates.
Cash
and Cash Equivalents
The
Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.
The Company had $387,858 in cash and did not have any cash equivalents as of December 31, 2021.
Concentration
of Credit Risk
Financial
instruments that potentially subject the Company to concentration of credit risk consist of a cash account in a financial institution
which, at times may exceed the Federal depository insurance coverage of $250,000. As of December 31, 2021, the Company had not experienced
losses on this account.
Marketable
Securities Held in Trust Account
The Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying condensed statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. At December 31, 2021, the Company had $115,000,744 cash
in marketable securities held in the trust account.
Offering
Costs Associated with the Initial Public Offering
Offering
costs consist of underwriting, legal, accounting, registration and other expenses incurred through the balance sheet date
that are directly related to the IPO. As of December 31, 2021, offering costs amounted to $5,669,696
consisting of $2,300,000
of underwriting fees, $2,875,000
of deferred underwriting fees, and $494,696
of other offering costs. The Company complies with the requirements of ASC 340-10-S99-1 and SEC Staff Accounting Bulletin
Topic 5A - “Expenses of Offering”. The Company allocates offering costs between public shares, public
rights and public warrants based on the estimated fair values of public shares, public warrants, and public rights at
the date of issuance.
Ordinary
Shares Subject to Possible Redemption
The
Company accounts for its ordinary shares subject to possible redemption in accordance with the guidance in Accounting
Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Ordinary shares
subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally
redeemable ordinary shares (including ordinary shares that feature redemption rights that is either within the control of
the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control)
is classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. The
Company’s ordinary shares features certain redemption rights that are considered to be outside of the Company’s
control and subject to occurrence of uncertain future events. Accordingly, ordinary shares subject to possible redemption is
presented at redemption value as temporary equity, outside of the shareholders’ equity section of the
Company’s balance sheet.
All
of the 11,500,000 shares of ordinary shares sold as part of the Units in the IPO contain a redemption feature
which allows for the redemption of such Public Shares in connection with the Company’s liquidation, if there is a stockholder vote
or tender offer in connection with the Business Combination and in connection with certain amendments to the Company’s Certificate
of Incorporation. Accordingly, all of the 11,500,000 shares of ordinary shares are presented as temporary equity.
The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each reporting period. Increases
or decreases in the carrying amount of redeemable ordinary shares are affected by charges against additional paid-in capital and
accumulated deficit if additional paid in capital equals to zero.
Fair
Value of Financial Instruments
The
fair value of the Company’s assets and liabilities approximates the carrying amounts represented in the accompanying balance sheet, primarily due to the short-term
nature.
Net
Income (Loss) per Share
The
Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered the undistributed income (loss) allocable to both the redeemable shares and non-redeemable shares and the undistributed income (loss) is calculated using the total net loss less any dividends paid. The Company then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable shares. Any remeasurement of the accretion to redemption value of the ordinary shares subject to possible redemption was considered to be dividends paid to the public shareholders.
The
calculation of diluted income (loss) per ordinary shares does not consider the effect of the warrants issued in connection with the (i) Initial
Public Offering, and (ii) the private placement since the exercise of the warrants is contingent upon the occurrence of future events.
The warrants are exercisable to purchase 5,915,000 shares of ordinary shares in the aggregate. As of December 31, 2021, the
Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into ordinary shares
and then share in the earnings of the Company. As a result, diluted net income (loss) per ordinary shares is the same as basic net income
(loss) per ordinary shares for the periods presented.
The
net income (loss) per share presented in the statement of operations is based on the following:
Schedule
of statement of operations
For the
period from
March 11, 2021
(inception) to
December 31,
Net
(loss) income $ (52,509 )
Accretion of temporary equity to redemption value $ (19,855,970 )
Net loss including accretion of temporary equity to redemption value $ (19,908,479 )
Schedule of basic and diluted
net income (loss) per share
For the
period from
March 11, 2021
(inception) to
December 31,
Non-redeemable shares Redeemable shares
Basic
and Diluted net income (loss) per share:
Numerators:
Allocation
of net losses included accretion $ (16,209,143 ) $ (3,699,335 )
Accretion
of temporary equity to redemption value
$ 19,855,970
Allocation
of net income (loss) $ (16,209,143 ) $ 16,156,634
Denominators:
Weighted-average
shares outstanding 2,893,953 660,473
Basic
and diluted net income (loss) per share $ (5.60 ) $ 24.46
Income
Taxes
The
Company accounts for income taxes under ASC 740 Income Taxes (“ASC 740”). ASC 740 requires the recognition of deferred tax
assets and liabilities for both the expected impact of differences between the financial statement and tax basis of assets and liabilities
and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation
allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.
ASC
740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes
a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected
to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination
by taxing authorities. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim
period, disclosure and transition. The Company has identified the Cayman Islands as its only “major” tax jurisdiction,
as defined. Based on the Company’s evaluation, it has been concluded that there are no significant uncertain tax positions requiring
recognition in the Company’s financial statement. Since the Company was incorporated on March 11, 2021, the evaluation was performed
for the period ended December 31, 2021 which will be the only period subject to examination. The Company believes that its income tax
positions and deductions would be sustained on audit and does not anticipate any adjustments that would result in a material changes
to its financial position. The Company’s policy for recording interest and penalties associated with audits is to record such items
as a component of income tax expense.
The
provision for income taxes was deemed to be immaterial for the period from March 11, 2021 (inception) through December 31, 2021.
Warrants
The
Company evaluates the Public and Private Warrants as either equity-classified or liability-classified instruments based on
an assessment of the warrants’ specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”)
Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815,
Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments
pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for
equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares, among other
conditions for equity classification. Pursuant to such evaluation, both Public and Private Warrants will be classified in stockholders’
equity.
Recently
Issued Accounting Standards
In
August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt
- Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s
Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates
the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies
the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard
also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s
own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method
for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective
basis, with early adoption permitted beginning on January 1, 2021. The Company is currently assessing the impact, if any, that ASU 2020-06 would
have on its financial position, results of operations or cash flows.
Management
does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material
effect on the Company’s financial statements.
Note
3 - Initial Public Offering
On
December 15, 2021, the Company consummated the initial public offering and sale of 11,500,000 units (including the issuance of 1,500,000 units as a result of the underwriters’
fully exercise of the over-allotment) at a price of $10.00 per Unit, generating gross proceeds of $115,000,000. Each
Unit consists of one ordinary share, one redeemable warrant (each a “Warrant”, and, collectively, the “Warrants”),
and one right to receive one-seventh (1/7) of an ordinary share upon the consummation of a Business Combination. Each two redeemable
warrants entitle the holder thereof to purchase one ordinary share, and each seven rights entitle the holder thereof to receive one ordinary
share at the closing of a Business Combination. No fractional shares issued upon separation of the Units, and only whole Warrants will
trade.
The
Company granted the underwriters a 45-day option from the date of the IPO to purchase up to an additional 1,500,000 units to cover
over-allotments. On December 15, 2021, the underwriters exercised the over-allotment option in full to purchase 1,500,000 Public Units,
at a purchase price of $10.00 per Public Unit, generating gross proceeds to the Company of $15,000,000.
At
December 31, 2021, the ordinary share reflected in the balance sheet are reconciled in the following tables:
Schedule of ordinary shares subject to possible redemption
Gross proceeds from public shares $ 115,000,000
Less:
Proceeds allocated to pubic rights (11,780,488 )
Proceeds allocated to pubic warrants (3,141,463 )
Allocation of offering costs related to ordinary shares (4,934,018 )
Total (19,855,970 )
Plus:
Accretion of carrying value to redemption value 19,855,970
Ordinary shares subject to possible redemption $ 115,000,000
Note
4 - Private Placement
Concurrently
with the consummation of the IPO, A-Star Management Corporation, the Sponsor, purchased an aggregate of 330,000 units at a price of $10.00 per Private
Unit for an aggregate purchase price of $3,300,000 in a private placement. The Private Units are identical to the public Units except
with respect to certain registration rights and transfer restrictions. The proceeds from the Private Units were added to the proceeds
from the IPO to be held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period,
the proceeds from the sale of the Private Units will be used to fund the redemption of the Public Shares (subject to the requirements
of applicable law), and the Private Units and all underlying securities will expire worthless.
Note
5 - Related Party Transactions
Founder
Shares
On
March 11, 2021, the Company issued one ordinary share to the Sponsor for no consideration. On April 6, 2021, the Company cancelled
the one share for no consideration and the Sponsor purchased 2,875,000 ordinary shares for an aggregate price of $25,000.
The 2,875,000 founder shares (for purposes hereof referred to as the “Founder Shares”) include an aggregate of up to 375,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment is not exercised in full or in part, so that the Sponsor will collectively own 20% of the Company’s issued and outstanding shares after the Proposed Offering. On December 15, 2021, the underwriters exercised the over-allotment option in full, so there are no Founder Shares subject to forfeiture as of December 31, 2021.
The Sponsor and each Insider agrees that
it, he or she shall not (a) Transfer 50% of their Founder Shares until the earlier of (A) six months after the consummation
of the Company’s initial Business Combination or (B) the date on which the closing price of the Ordinary Shares equals
or exceeds $12.50 per share (as adjusted for share splits, share capitalizations, rights issuances, subdivisions, reorganizations,
recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after the Company’s initial
Business Combination or (b) Transfer the remaining 50% of their Founder Shares until six months after the date of the consummation
of the Company’s initial Business Combination, or earlier in either case, if subsequent to the Company’s initial Business
Combination the Company completes a liquidation, merger, share exchange, reorganization or other similar transaction that results
in all of the Company’s shareholders having the right to exchange their Ordinary Shares for cash, securities or other property
(the “Founder Shares Lock-up Period”).
Administrative
Services Agreement
The
Company entered into an administrative services agreement, commencing on December 13, 2021, through the earlier of the Company’s
consummation of a Business Combination or its liquidation, to pay to the Sponsor a total of $10,000 per month for office space,
secretarial and administrative services provided to members of the Company’s management team. For the period from March 11, 2021 (inception) through December 31,
2021, the Company incurred $6,129 in fees for these services.
Sponsor
Promissory Note - Related Party
On
March 26, 2021, the Company issued an unsecured promissory note to the Sponsor, pursuant to which the Company may borrow up to an
aggregate principal amount of $300,000 (the “Promissory Note”). The Promissory Note is non-interest bearing and payable on
the earlier of (i) December 31, 2021 or (ii) the consummation of the Proposed Offering. The loan repaid as $300,000 allotted
to the payment of offering expense. Sponsor promissory note balance as of December 31, 2021 was nil. 0
Note
6 - Commitments and Contingencies
Risks
and Uncertainties
Management
continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could
have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific
impact is not readily determinable as of the date of these financial statements. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
Underwriters
Agreement
The
Company granted the underwriters, a 45-day option to purchase up to 1,500,000 Units (over and above the 10,000,000 units referred to
above) solely to cover over-allotments at $10.00 per Unit. On December 15, 2021, the underwriters exercised the over-allotment option
in full to purchase 1,500,000 Units at a purchase price of $10.00 per Unit.
On
December 15, 2021, the Company paid a cash underwriting commission of 2.0% of the gross proceeds of the IPO, or $2,300,000.
The
underwriters are entitled to a deferred underwriting commission of 2.5% of the gross proceeds of the IPO, or $2,875,000, which will be
paid from the funds held in the Trust Account upon completion of the Company’s initial Business Combination subject to the terms
of the underwriting agreement. As of December 31, 2021, the Company has the deferred underwriting commissions $2,875,000 as current
liabilities.
Registration
Rights
The
holders of the Founder Shares will be entitled to registration rights pursuant to a registration rights agreement to be signed prior
to or on the effective date of the Proposed Offering. The holders of these securities are entitled to make up to three demands, excluding
short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration
rights with respect to registration statements filed subsequent to the consummation of a Business Combination and rights to require the
Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses
incurred in connection with the filing of any such registration statements.
Note
7 - Stockholders’ Deficit
Ordinary
Shares
The
Company is authorized to issue 50,000,000 ordinary shares, with a par value of $0.001 per share. Holders of the ordinary shares are entitled
to one vote for each ordinary share. At December 31, 2021, there were 3,205,000 ordinary shares issued and outstanding, excluding 11,500,000
shares subject to possible redemption. The Sponsor has agreed to forfeit 375,000 ordinary shares to the extent that the over-allotment
option is not exercised in full by the underwriters. On December 15, 2021, the underwriters fully exercised the over-allotment option,
as such there are no ordinary shares subject to forfeiture.
Public Warrants
Pursuant to the Initial Public Offering, the Company sold 11,500,000 Units at a price of $10.00 per Unit for a total of $115,000,000. The total amounts of ordinary shares subject to possible redemption is 11,500,000. Each Unit consists of one ordinary share, one right to acquire one-seventh (1/7) of an ordinary share, and one redeemable warrant (“Public Warrant”) to purchase one-half of one ordinary share at a price of $11.50 per share, subject to adjustment.
Each warrant entitles the holder to purchase one-half ordinary share at a price of $11.50 per share commencing 30 days after the completion of its initial business combination and expiring five years from after the completion of an initial business combination. No fractional warrant will be issued and only whole warrants will trade. The Company may redeem the warrants at a price of $0.01 per warrant upon 30 days’ notice, only in the event that the last sale price of the ordinary shares is at least $18.00 per share for any 20 trading days within a 30-trading day period ending on the third day prior to the date on which notice of redemption is given, provided there is an effective registration statement and current prospectus in effect with respect to the ordinary shares underlying such warrants during the 30 day redemption period. If a registration statement is not effective within 60 days following the consummation of a business combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act.
In addition, if (a) the Company issues additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of the initial Business Combination at an issue price or effective issue price of less than $9.20 per share (with such issue price or effective issue price to be determined in good faith by our board of directors), (b) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination, and (c) the volume weighted average trading price of the ordinary shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates the initial Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the Market Value, and the last sales price of the ordinary shares that triggers the Company's right to redeem the Warrants will be adjusted (to the nearest cent) to be equal to 180% of the Market Value.
Private warrants
The private warrants have terms and provisions that are identical to those of the warrants being sold as part of the units in this offering.
Rights
Except
in cases where the Company is not the surviving Company in a business combination, the holders of the rights will automatically
receive 1/7 of a share of ordinary shares upon consummation of the Company’s initial business combination. In
the event the Company will not be the surviving company upon completion of the initial business combination, each holder of a
right will be required to affirmatively convert his, her or its rights in order to receive the 1/7 of a share underlying each
right upon consummation of the business combination. As of December 31, 2021, no rights had been issued.
Note
8 - Fair Value Measurements
The
Company complies with ASC 820, “Fair Value Measurements”, for its financial assets and liabilities that are
re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are
re-measured and reported at fair value at least annually. ASC 820 determines fair value to be the price that would be
received to sell an asset or would be paid to transfer a liability (i.e., the exit price) in an orderly transaction between
market participants at the measurement date.
The
following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used
in order to value the assets and liabilities:
Level 1: Quoted
prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions
for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2: Observable
inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets
or liabilities and quoted prices for identical assets or liabilities in markets that are not active.
Level 3: Unobservable
inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.
At
December 31, 2021, assets held in the trust account were entirely comprised of marketable securities.
The
following table presents information about the Company’s assets that are measured at fair value on a recurring basis at December
31, 2021 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.
December 31, 2021
Schedule of fair value, assets and liabilities measured on recurring basis
Assets Quoted
Prices in
Active Markets
(Level 1) Significant
Other
Observable Inputs
(Level 2) Significant
Other
Unobservable Inputs
(Level 3)
Marketable
Securities held in Trust Account $ 115,000,744 $ - $ -
Note
9 - Subsequent Events
The
Company evaluated subsequent events and transactions that occurred after the balance sheet date up to March 29, 2022 the
date the financial statement was available to be issued. Based upon the review, the Company did not identify any subsequent events
that would have required adjustment or disclosure in the financial statement.
(2) Exhibits
We
here by file as part of this Report the exhibits listed in the attached Exhibit Index. Exhibits which are incorporated herein by
reference can be inspected and copied at the public reference facilities maintained by the SEC, 100 F Street, N.E., Room 1580, Washington,
D.C. 20549. Copies of such material can also be obtained from the Public Reference Section of the SEC, 100 F Street, N.E., Washington,
D.C. 20549, at prescribed rates or on the SEC website at www.sec.gov.(1)
Exhibit No.
Description
1.1
Underwriting Agreement, date December 13, 2021, by and among the Company, Ladenburg Thalmann & Co. Inc. (1)
3.1
Amended and Restated Memorandum and Articles of Association. (1)
4.1
Warrant Agreement, dated December 3, 2021, by and between the Company and Vstock Transfer LLC, as warrant agent. (1)
4.2
Description of Registrant’s Securities (3)
10.1
Letter Agreement, dated December 3, 2021, by and among the Company, its officers, directors and A-Star Management Corporation. (1)
10.2
Administrative Services Agreement, dated July 23, 2021, by and among the Company and A-Star Management Corporation. (3)
10.3
Investment Management Trust Agreement, December 9, 2021, by and between the Company and Wilmington Trust, National Association, and Vstock Transfer, as trustee. (1)
10.4
Registration Rights Agreement, dated December 13, 2021, by and among the Company, M-Star Management Corporation and the holders party thereto. (1)
10.5
Private Placement Units Purchase Agreement, December 13, 2021, by and between the Company and A-Star Management Corporation. (3)
10.6
Securities Subscription Agreement, dated March 26, 2021, between the Registrant and A-Star Management Corporation. (2)
List of subsidiaries. (3)
31.1
Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a)*
31.2
Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) *
32.1
Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350**
32.2
Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350**
101.INS
XBRL
Instance Document*
101.SCH
XBRL
Schema Document*
101.CAL
XBRL
Calculation Linkbase Document*
101.DEF
XBRL
Definition Linkbase Document*
101.LAB
XBRL
Label Linkbase Document*
101.PRE
XBRL
Presentation Linkbase Document*
(1) Filed
as an Exhibit to the Registrant’s Form 8-K as filed with the Commission on December 15, 2021.
(2) Filed
as an exhibit to the Registrant’s Form S-1 as filed with the Commission on June 29, 2021.
(3) Field
as an Exhibit to this Form 10-K.
*
Filed
herewith.
** Furnished
herewith.