HHG Capital: Index To Financial Statements

The following excerpt is from the company's SEC filing.
Report of Independent Registered Public Accounting Firm
Balance Sheet
Notes to Balance Sheet
F-4
– F-11
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
the Board of Directors and Stockholders of
HHG
Capital Corporation
Opinion
on the Financial Statement
We
have audited the accompanying balance sheet of HHG Capital Corporation (the “Company”) as of September 23, 2021, and the
related notes (collectively referred to as the “financial statement”). In our opinion, the financial statement presents fairly,
in all material respects, the financial position of the Company as of September 23, 2021 in conformity with accounting principles generally
accepted in the United States of America.
Basis
for Opinion
This
financial statement is the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s
financial statement 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 statement is 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 statement, 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 statement. 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 statement. We believe that our audit provides
a reasonable basis for our opinion.
/s/
Friedman LLP
We
have served as the Company’s auditor since 2021.
New
York, NY
September
28, 2021
HHG
CAPITAL CORPORATION
BALANCE
SHEET
(Currency
expressed in United States Dollars (“US$”), except for number of shares)
ASSETS
Current assets:
970,430
Non-current assets:
Cash held in Trust Account
58,075,000
TOTAL ASSETS
59,045,430
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accrued liabilities
29,453
Other payables
11,563
Promissory note from a related party
100,000
Total current liabilities
141,016
Deferred underwriting compensation
1,615,000
TOTAL LIABILITIES
1,756,016
Commitments and contingencies
Ordinary shares subject to possible redemption 5,750,000
shares issued and outstanding at redemption value
46,245,764
Shareholders’ equity:
Ordinary shares, $0.0001 par value per share; 500,000,000 shares authorized; 1,727,000
shares issued and outstanding (excluding 5,750,000 subject to possible redemption)
Additional paid-in capital
11,112,041
Accumulated deficit
(68,563
Total Shareholders’ equity
11,043,650
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
See
accompanying notes to balance sheet.
NOTES
TO BALANCE SHEET
NOTE
1 - ORGANIZATION AND BUSINESS BACKGROUND
HHG
Capital Corporation (the “Company” or “we”, “us” and “our”) is a newly organized blank
check company incorporated on July 15, 2020, under the laws of the British Virgin Islands for the purpose of acquiring, engaging in a
share exchange, share reconstruction and amalgamation, purchasing all or substantially all of the assets of, entering into contractual
arrangements, or engaging in any other similar business combination with one or more businesses or entities (“Business Combination”).
Currently, the Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination.
From
inception through September 23, 2021, the Company had not yet commenced any operations. All activity through September 23, 2021 relates
to the Company’s formation and the Initial Public Offering defined and described below. The Company has selected December 31 as
its fiscal year end.
Financing
The
registration statement for the Company’s initial public offering (the “Initial Public Offering” as described in Note
3) became effective on September 20, 2021. On September 23, 2021, the Company consummated the Initial Public Offering of 5,000,000 ordinary
units (the “Public Units”), generating gross proceeds of $50,000,000 which is described in Note 3.
On
September 23, 2021, the underwriters exercised the over-allotment option in full.
The underwriters
purchased an additional 750,000 Units (the “Over-Allotment Units”) at an offering price of $10.00 per Unit, generating gross
proceeds to the Company of $7,500,000.
Simultaneously
with the closing of the Initial Public Offering, the Company consummated the sale of 237,000 units (the “Private Units”)
at a price of $10.00 per Private Unit in a private placement, generating gross proceeds of $2,370,000, which is described in Note 4.
On September 23, 2021, simultaneously with the sale of the over-allotment units, the Company consummated the private sale of an additional
18,000 Private Units, generating gross proceeds of $180,000.
Transaction
costs paid upon the consummation of the Initial Public Offering amounted to $1,031,411, consisting of $805,000 of underwriter’s
fees and $226,411 of other offering costs.
Trust
Account
Upon
the closing of the Initial Public Offering, the exercise of the over-allotment option and the closing of the private placement, $58,075,000
was placed in a trust account (the “Trust Account”) with American Stock & Trust Company, LLC acting as trustee. The funds
held in the Trust Account can be invested in United States government treasury bills, bonds or notes, having a maturity of 180 days or
less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act until the earlier
of (i) the consummation of the Company’s initial Business Combination and (ii) the Company’s failure to consummate a Business
Combination within the Combination Period as described below. Placing funds in the Trust Account may not protect those funds from third
party claims against the Company. Although the Company will seek to have all vendors, service providers, prospective target businesses
or other entities it engages, execute agreements with the Company waiving any claim of any kind in or to any monies held in the Trust
Account, there is no guarantee that such persons will execute such agreements. The remaining net proceeds (not held in the Trust Account)
may be used to pay for business, legal and accounting due diligence on prospective acquisitions and continuing general and administrative
expenses. Additionally, the interest earned on the Trust Account balance may be released to the Company to pay the Company’s tax
obligations.
Pursuant
to Nasdaq listing rules, the Company’s initial Business Combination must occur with one or more target businesses having an aggregate
fair market value equal to at least 80% of the value of the funds in the Trust Account (excluding any deferred underwriter’s fees
and taxes payable on the income earned on the Trust Account), which the Company refers to as the 80% test, at the time of the execution
of a definitive agreement for our initial Business Combination, although the Company may structure a Business Combination with one or
more target businesses whose fair market value significantly exceeds 80% of the Trust Account balance. If the Company is no longer listed
on Nasdaq, it will not be required to satisfy the 80% test. The Company currently anticipates structuring a Business Combination to acquire
100% of the equity interests or assets of the target business or businesses.
The
Company will provide its shareholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a
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 the Company will seek shareholder approval of a Business Combination or conduct a tender
offer will be made by the Company, solely in its discretion. The shareholders will be entitled to redeem their Public Shares for a pro
rata portion of the amount then on deposit in the Trust Account (initially $10.10 per share, plus any pro rata interest earned on the
funds held in the Trust Account and not previously released to the Company to pay its tax obligations). The per-share amount to be distributed
to shareholders who redeem their shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters
(as discussed in Note 6). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s
warrants and rights. The ordinary shares subject to redemption will be recorded at a redemption value and classified as temporary equity
upon the completion of the Proposed Public Offering, in accordance with Accounting Standards Codification (“ASC”) Topic 480

Distinguishing Liabilities from Equity
The
Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation
of a Business Combination and, if the Company seeks shareholder approval, a majority of the outstanding shares voted are voted in favor
of the Business Combination. If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business
or other legal reasons, the Company will, pursuant to its Second Amended and Restated Memorandum and Articles of Association, offer such
redemption pursuant to the tender offer rules of the Securities and Exchange Commission (“SEC”), and file tender offer documents
containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination.
The
Company’s initial shareholders (the “initial shareholders”) have agreed (a) to vote their insider shares, the ordinary
shares included in the Private Units (the “Private Shares”) and any Public Shares purchased during or after the Proposed
Public Offering in favor of a Business Combination, (b) not to propose, or vote in favor of, an amendment to the Company’s Second
Amended and Restated Memorandum and Articles of Association that would stop the public shareholders from converting or selling their
shares to the Company in connection with a Business Combination or affect the substance or timing of the Company’s obligation to
redeem 100% of the Public Shares if the Company does not complete a Business Combination within the Combination Period (as defined below)
unless the Company provides dissenting public shareholders with the opportunity to convert their Public Shares into the right to receive
cash from the Trust Account in connection with any such vote; (c) not to convert any insider shares and Private Units (including underlying
securities) (as well as any Public Shares purchased during or after the Proposed Public Offering) into the right to receive cash from
the Trust Account in connection with a shareholder vote to approve a Business Combination (or sell any shares in a tender offer in connection
with a Business Combination) or a vote to amend the provisions of the Second Amended and Restated Memorandum and Articles of Association
relating to shareholders’ rights of pre-Business Combination activity and (d) that the insider shares and Private Units (including
underlying securities) shall not participate in any liquidating distributions upon winding up if a Business Combination is not consummated.
However, the initial shareholders will be entitled to liquidating distributions from the Trust Account with respect to any Public Shares
purchased during or after the Proposed Public Offering if the Company fails to complete its Business Combination. The Company will have
until 12 months (or 15 months if the Company has filed a proxy statement, registration statement or similar filing for an initial business
combination within 12 months from the consummation of the Proposed Public Offering but have not completed the initial business combination
within such 12-month period, or up to 21 months if the Company extends the period of time to consummate a business combination, as described
in more detail in this prospectus) from the closing of the Proposed Public Offering to complete its Business Combination (the “Combination
Period”).
Liquidation
If
the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except
for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter, redeem 100% of
the outstanding Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account,
including interest earned (net of taxes payable), 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 the remaining shareholders and the Company’s board of directors,
proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject in each case to its obligations
to provide for claims of creditors and the requirements of applicable law. The underwriters have agreed to waive its rights to the deferred
underwriting commission held in the Trust Account in the event the Company does not complete a Business Combination within the Combination
Period and, in such event, such amounts will be included with the funds held in the Trust Account that will be available to fund the
redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available
for distribution will be less than $10.10.
The
Sponsor has agreed that it will be liable to the Company, if and to the extent any claims by a vendor for services rendered or products
sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce
the amounts in the Trust Account to below $10.10 per share (whether or not the underwriters’ over-allotment option is exercised
in full), 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 the Company’s indemnity of the underwriters of the Proposed Public Offering against certain liabilities,
including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). In the event that an executed
waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such
third party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to
claims of creditors by endeavoring to have all vendors, service providers, prospective target businesses or other entities with which
the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies
held in the Trust Account.
NOTE
2 – SIGNIFICANT ACCOUNTING POLICIES
Basis
of presentation
The
accompanying financial statement has been prepared in accordance with generally accepted accounting principles in the United States of
America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).
Emerging
growth company
The
Company is an “
emerging growth company
,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart
Our Business Startups Act of 2012 (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 not limited to, not
being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley
Act, reduced disclosure obligations regarding executive compensation in its 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.
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 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
In
preparing the financial statement in conformity with U.S. GAAP, management makes 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.
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 did not have any cash equivalents as of September 23, 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.
The Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such
account.
Cash
held in Trust Account
At
September 23, 2021, the assets held in Trust Account were held in cash.
Warrant
accounting
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,
(“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.
As
the warrants issued upon the IPO and private placements meet the criteria for equity classification under ASC 480, therefore, the warrants
are classified as equity.
Ordinary
shares subject to possible redemption
The
Company accounts for its ordinary shares subject to possible redemption in accordance with the guidance in ASC Topic 480
“Distinguishing
Liabilities from Equity.”
Ordinary shares subject to mandatory redemption (if any) 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 the Company’s
control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. The Company’s
ordinary shares issued upon the consummation of the IPO and the exercise of the over-allotment option feature certain redemption rights
that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at
September 23, 2021, ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’
equity section of the Company’s balance sheet.
The
Company has made a policy election in accordance with ASC 480-10-S99-3A and recognizes changes in redemption value in accumulated deficit
over an expected 12-month period leading up to a Business Combination. On September 23, 2021, the Company had not recorded any accretion.
Income
taxes
Income
taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this
method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are
measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected
to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the
period that includes the enactment date.
ASC
740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statement
uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the
financial statement when it is more likely than not the position will be sustained upon examination by the tax authorities. The Company’s
management determined that the British Virgin Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest
and penalties related to unrecognized tax benefits, if any, as income tax expense. There were no unrecognized tax benefits and no amounts
accrued for interest and penalties as of September 23, 2021. The Company is currently not aware of any issues under review that
could result in significant payments, accruals or material deviation from its position.
The
Company may be subject to potential examination by foreign taxing authorities in the area of income taxes. These potential examinations
may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with
foreign tax laws.
The
Company is considered to be an exempted British Virgin Islands Company, and is presently not subject to income taxes or income tax filing
requirements in the British Virgin Islands or the United States.
Related
parties
Parties,
which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control
the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also
considered to be related if they are subject to common control or common significant influence.
Fair
value of financial instruments
The
fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “
Fair
Value Measurements and Disclosures
,” approximates the carrying amounts represented in the accompanying balance sheet, primarily
due to their short-term nature.
Recent
accounting pronouncements
The
Company has considered all new accounting pronouncements and has concluded that there are no new pronouncements that may have a material
impact on the results of operations, financial condition, or cash flows, based on the current information.
NOTE
3 — INITIAL PUBLIC OFFERING
On
September 23, 2021, the Company sold 5,000,000 Public Units at a price of $10.00 per Unit. Simultaneously, the Company sold an additional
750,000 units to cover over-allotments. Each Public Unit consists of one ordinary share, one right (“Public Right”) and one
redeemable warrant (“Public Warrant”). Each Public Right will convert into one-tenth (1/10) of one ordinary share upon the
completion of the initial Business Combination. Each Public Warrant will entitle the holder to purchase three-fourth (3/4) of one ordinary
share at an exercise price of $11.50 per whole share. The Company will not issue fractional shares upon the exercise of the Public Warrant
or the conversion of the Public Right.
If
the Company does not complete its Business Combination within the necessary time period described in Note 1, the Public Warrants and
Public Rights will expire and be worthless. Since the Company is not required to net cash settle the Public Warrants and Public Rights
and the Public Warrants and Public Rights are exercisable or convertible upon the consummation of an initial Business Combination, the
Management determined that the Public Warrants and Public Rights are classified within shareholders’ equity as “Additional
paid-in capital” upon their issuance in accordance with ASC 815-40. The proceeds from the sale are allocated to Public Shares,
Public Warrants and Public Rights based on the relative fair value of the securities in accordance with ASC 470-20-30.
The
Company paid an upfront underwriting discount of $805,000, equal to 1.4% of the gross offering proceeds to the underwriter at the closing
of the Initial Public Offering, with an additional fee of $1,615,000 (the “Deferred Underwriting Discount”). The Deferred
Underwriting Discount will become payable to the underwriter from the amounts held in the Trust Account solely in the event the Company
completes its Business Combination. In the event that the Company does not close the Business Combination, the underwriter has waived
its right to receive the Deferred Underwriting Discount. The underwriter is not entitled to any interest accrued on the Deferred Underwriting
Discount.
Besides
the upfront underwriting discount of $805,000 and the Deferred Underwriting Discount of $1,615,000, the Company also incurred other offering
expenses of $297,023. The Company allocates offering costs totaled $2,717,023 between Public Shares, Public Warrants and Public Rights
based on the estimated fair value of each at the date of issuance. Accordingly, $2,284,236 offering cost was allocated to Public
Shares, $432,787 offering cost was allocated to Public Warrants and Public Rights.
As
a result of the aforementioned allocation, $46,245,764 is allocated to the ordinary shares included in the Public Units and recorded
as temporary equity as of September 23, 2021 and $8,537,213 is allocated to the Public Warrants and Public Rights and is recorded
as part of the additional paid-in capital as of September 23, 2021.
NOTE
4 – PRIVATE PLACEMENT
the Company consummated the private placement
(“Private Placement”) with its sponsor of 255,000 units (the “Private Units”) at a price of $10.00 per Private
Unit, generating total proceeds of $2,550,000.
Each Private Unit consists of one Private Share, one Private Right (“Private
Right”) and one redeemable warrant (each, a “Private Warrant”). Each Private Right will convert into one-tenth (1/10)
of one ordinary share upon the completion of the Business Combination. Each Private Warrant is exercisable to purchase three-fourth (3/4)
of one ordinary share at a price of $11.50 per share. The Company will not issue fractional shares upon the exercise of the Public Warrant
or the conversion of the Public Right.
The
Private Units are identical to the units sold in the Initial Public Offering except with certain registration rights and transfer restrictions.
NOTE
5 – RELATED PARTY TRANSACTIONS
Founder
Shares
In
July 2020, the Company issued an aggregate of 10,000 founder shares to the initial shareholders for an aggregate purchase price of $1.
In
November 2020, the Company issued an aggregate of 1,240,000 additional founder shares to the initial shareholders for an aggregate purchase
price of $24,999.
In
February 2021, the Company issued an aggregate of 187,500 additional founder shares to the initial shareholders for an aggregate purchase
price of $18. These shares are subject to forfeiture to the extent that the underwriters’ over-allotment option is not exercised
in full or in part.
Promissory
note from a Related Party
In
February 2021, the Company issued an unsecured promissory note of $500,000 (the “Promissory Note) to a related party, HHG Investment
Fund SPC – HHG Capital Fund SP (“HHG Fund”), which was a majority owner of the Company. The promissory note is unsecured,
interest-free and repayable on February 16, 2022. The Company has repaid $400,000 to HHG Fund on April 20, 2021. As of September 23,
2021, the principal amount due and owing under the Promissory Note was $100,000.
Administrative
Services Agreement
The
Company is obligated, commencing from the date of the consummation of the offering, to pay the Sponsor a monthly fee of $10,000 for general
and administrative services. This agreement will terminate upon completion of the Company’s Business Combination or the liquidation
of the trust account to public shareholders.
NOTE
6 – SHAREHOLDERS’ EQUITY
On
September 23, 2021, the Company completed the Initial Public Offering and issued an aggregate of 5,750,000 Public Units and raised gross
proceeds of $57,500,000. Refer to Note 3 for details. Simultaneously, the Company completed a private placement and issued an aggregate
of 255,000 Private Units and raised gross proceeds of $2,550,000. Refer to Note 4 for details.
Ordinary
shares
The
Company is authorized to issue 500,000,000 ordinary shares at par $0.0001. Holders of the Company’s ordinary shares are entitled
to one vote for each share.
Each
holder of a right (including Public Rights and Private Rights) will automatically receive one-tenth (1/10) of one ordinary share upon
consummation of a Business Combination, even if the holder of such right redeemed all shares held by it in connection with a Business
Combination. No fractional shares will be issued upon exchange of the rights. In the event the Company will not be the surviving company
upon completion of a Business Combination, each holder of a right will be required to affirmatively convert the rights in order to receive
the one-tenth (1/10) of an ordinary share underlying each right upon consummation of a Business Combination.
If
the Company is unable to complete a Business Combination within the required time period and the Company redeems the public shares for
the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire
worthless.
The
Public Warrants will become exercisable on the later of (a) the completion of a Business Combination or (b) 12 months from the closing
of this Initial Public Offering. No Public Warrants will be exercisable for cash unless the Company has an effective and current registration
statement covering the ordinary shares issuable upon exercise of the Public Warrants and a current prospectus relating to such ordinary
shares. Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable upon the exercise of the Public
Warrants is not effective within 90 business days from the consummation of a Business Combination, the 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 the Public Warrants on a cashless basis pursuant to the exemption from registration provided by Section 3(a)(9) of
the Securities Act provided that such exemption is available. If an exemption from registration is not available, holders will not be
able to exercise their Public Warrants on a cashless basis. The Public Warrants will expire five years after the completion of the Business
Combination, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation.
The
Company may call the warrants for redemption, in whole and not in part, at a price of $0.01 per warrant:
at
any time while the Warrants are exercisable,
upon
not less than 30 days’ prior written notice of redemption to each Warrant holder,
if,
and only if, the reported last sale price of the ordinary shares equals or exceeds $18.00 per share, for any 20 trading days within
a 30 trading days period ending on the third trading day prior to the notice of redemption to Warrant holders, and
if,
and only if, there is a current registration statement in effect with respect to the issuance of the ordinary shares underlying such
warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter
until the date of redemption.
The
Private Warrants will be identical to the Public Warrants underlying the Units being sold in the Initial Public Offering. The Private
Warrants (including the ordinary shares issuable upon exercise of the Private Warrants) will not be transferable, assignable or salable
until after the completion of the initial Business Combination.
If
the Company calls the warrants for redemption, management will have the option to require all holders that wish to exercise the warrants
to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of ordinary shares issuable
upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend
or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuances of ordinary shares
at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company
is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account,
holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the
Company’s assets held outside of the Trust Account with respect to such warrants. Accordingly, the warrants may expire worthless.
The
Company assessed the key terms applicable to the Public Warrants as well as the Private Warrants and classified Public Warrants and Private
Warrants as equity in accordance with ASC 480,
, (“ASC 815”).
NOTE
7 – COMMITMENTS AND CONTINGENCIES
Risks
and Uncertainties
Management
is currently evaluating the impact of the COVID-19 pandemic on the industry 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.
Registration
Rights
The
holders of the Founder Shares, the private units (and their underlying securities) and the any units that may be issued upon conversion
of the Working Capital Loans (and their underlying securities) 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 Public Offering. The holders of a majority of these securities
will be entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares
can elect to exercise these registration rights at any time commencing three months prior to the date on which these ordinary shares
are to be released from escrow. The holders of a majority of the private units (and their underlying securities) and any securities issued
in payment of Working Capital Loans made to the Company (or underlying securities) can elect to exercise these registration rights at
any time after the Company consummates a Business Combination. In addition, the holders will have certain “piggy-back” registration
rights with respect to registration statements filed subsequent to the completion of a Business Combination. The Company will bear the
expenses incurred in connection with the filing of any such registration statements.
NOTE
8 – SUBSEQUENT EVENTS
The
Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statement
was issued. The Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statement.

The above information was disclosed in a filing to the SEC. To see the filing, click here.

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