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 consolidated
financial statements and the notes related thereto which are included in “Item 8. Consolidated 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 “Cautionary 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 on April 19, 2021 as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset
acquisition, stock purchase, reorganization or similar business combination with one or more businesses (a “Business Combination”).
We consummated our initial public offering on December 22, 2021 and are currently in the process of locating suitable targets for our
business combination. We intend to use the cash proceeds from our Public Offering and the Private Placement described below as well as
additional issuances, if any, of our capital stock, debt or a combination of cash, stock and debt to complete the Business Combination.
We expect to incur significant
costs in the pursuit of our initial Business Combination. We cannot assure you that our plans to raise capital or to complete our initial
Business Combination will be successful.
Recent Developments
On November 7, 2022, NorthView
entered into a Merger Agreement and Plan of Reorganization (the “Merger Agreement”), by and among NorthView, NV Profusa Merger
Sub Inc., a Delaware corporation and a direct, wholly-owned subsidiary of NorthView (“Merger Sub”), and Profusa, Inc., a California
corporation (“Profusa”).
The Merger Agreement provides
that, among other things, at the closing (the “Closing”) of the transactions contemplated by the Merger Agreement, Merger
Sub will merge with and into Profusa (the “Merger”), with Profusa surviving as a wholly-owned subsidiary of NorthView. In
connection with the Merger, NorthView will change its name to “Profusa, Inc.” The Merger and the other transactions contemplated
by the Merger Agreement are hereinafter referred to as the “Business Combination.”
The Business Combination is
subject to customary closing conditions, including the satisfaction of the minimum available cash condition, the receipt of certain governmental
approvals and the required approval by the stockholders of NorthView and Profusa. There is no assurance that the Business Combination
will be completed.
The aggregate consideration
to be received by the Profusa stockholders is based on a pre-transaction equity value of $155,000,000. The exchange ratio will be equal
to (a) $155,000,000, divided by an assumed value of NorthView Common Stock of $10.00 per share.
Subject to certain
future revenue and stock-price based milestones, Profusa stockholders will have the right to receive an aggregate of up to an
additional 3,875,000 shares of NorthView Common Stock (the “Earnout Shares”). One-quarter of the Earnout Shares will be
issued if, between the 18-month anniversary and the two year anniversary of the Closing, the combined company’s common stock
achieves a daily volume weighted average market price of at least $12.50 per share for any 20 trading days within a 30 consecutive
trading day period (“Milestone Event I”). One-quarter of the Earnout Shares will be issued if, between the first and
second anniversary of the Closing, the combined company’s common stock achieves a daily volume weighted average market price
of at least $14.50 per share for a similar number of days (“Milestone Event II”). One-quarter of the Earnout Shares will
be issued if the combined company achieves at least $5,100,000 in revenue or $73,100,000 in revenue in fiscal years 2023 or 2024,
respectively (or up to one-half of the Earnout Shares if both milestones are achieved).
Additionally, if Milestone
Event I or Milestone Event II are achieved by the second anniversary of the Closing, NorthView’s sponsor, NorthView Sponsor I, LLC
and Profusa stockholders, will be issued additional shares up to the amount of any shares forgone as an inducement to obtaining Additional
Financings (as defined in the Merger Agreement).
38
Results of Operations
As
of December 31, 2022, we had not commenced any operations. All activity for the period from April 19, 2021 (inception) through December
31, 2022 relates to our formation and the Initial Public Offering, and, subsequent to the IPO, identifying a target company for a Business
Combination. We have neither engaged in any operations nor generated any operating revenues to date. We will not generate any operating
revenues until after the completion of our initial Business Combination, at the earliest. We will generate non-operating income in the
form of interest income and unrealized gains from the cash and marketable securities held in the Trust Account. We expect to incur increased
expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due
diligence expenses.
For the year ended December
31, 2022, we had net income of $7,167,738, which consisted of a gain of $6,358,235 for the change in fair value of our warrant liabilities
and interest income of $2,579,268, offset by formation and operating costs of $1,270,554 and provision for income taxes of $499,211. We
are required to revalue our liability-classified warrants at the end of each reporting period and reflect in the statement of operations
a gain or loss from the change in fair value of the warrant liabilities in the period in which the change occurred.
For the period from April
19, 2021 (inception) through December 31, 2021, we had net income of $300,433, which consisted of a gain of $597,567 for the change in
fair value of our warrant liabilities and interest income of $6,461, offset by formation and operating costs of $45,047 and offering costs
allocated to warrants of $258,548.
Liquidity and Going Concern
As of December 31, 2022, we
had approximately $0.2 million in cash and working capital of approximately $0.2 million.
For the year ended December 31,
2022, cash used in operating activities was $581,189. Net income of $7,167,738 was impacted primarily by trust interest income of $2,579,268
and change in fair value of our warrant liabilities of $6,358,235. Changes in operating assets and liabilities reflected a source of cash
of $1,188,576 from operating activities during such period.
Prior to the completion of
the initial public offering, our liquidity needs had been satisfied through a capital contribution from the sponsor of $25,000 for the
founder shares to cover certain of the offering costs and the loan under an unsecured promissory note from the sponsor of $204,841, which
was fully paid upon the initial public offering. Subsequent to the consummation of the initial public offering and private placement,
our liquidity needs have been satisfied through the proceeds from the consummation of the private placement not held in the trust account.
In addition, in order to finance
transaction costs in connection with an intended business combination, the initial stockholders or an affiliate of the initial stockholders
or certain of our officers and directors may, but are not obligated to, provide us working capital loans. To date, there were no amounts
outstanding under any working capital loans.
We have until March 22, 2023
to consummate a Business Combination (which may be extended by up to six months as described in this report). It is uncertain that we
will be able to consummate a Business Combination by such date. If a Business Combination is not consummated by the required date, there
will be a mandatory liquidation and subsequent dissolution. In connection with our assessment of going concern considerations in accordance
with the authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”)
2014-15, “Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern,” management has determined
that mandatory liquidation, and subsequent dissolution, should we be unable to complete a business combination, raises substantial doubt
about our ability to continue as a going concern for the next twelve months from the issuance of these consolidated financial statements.
No adjustments have been made to the carrying amounts of assets and liabilities should we be required to liquidate after March 22, 2023.
Off-Balance Sheet Financing Arrangements
We did not have any off-balance
sheet arrangements as of December 31, 2022 and 2021.
Contractual Obligations
As of December 31, 2022 and
2021, we did not have any long-term debt, finance or operating lease obligations.
39
We
entered into an administrative services agreement with our sponsor pursuant to which we pay for office space and secretarial and administrative
services provided to members of our management team, in an amount of $5,000 per month. For the year ended December 31, 2022, $63,387
had been incurred and billed relating to the administrative service fee. As of December 31, 2022, $25,000 relating to the administrative
service fee was not paid yet and recorded as due to related party. For the period from April 19, 2021 (inception) through December 31,
2021, $1,613 had been accrued and charged to operating expenses.
NorthView previously engaged
I-Bankers as an advisor to assist in holding meetings to discuss the potential business combination and the target business’ attributes,
introduce NorthView to potential investors that are interested providing funding in connection with a Business Combination, assist NorthView
in obtaining stockholder approval for such business combination and assist NorthView with its press releases and public filings in connection
with such business combination (the “Business Combination Marketing Agreement”). In connection with such engagement, NorthView
agreed to pay IBS a cash fee (the “Business Combination Fee”) for such services upon the consummation of a business combination
in an amount equal to 3.68% of the gross proceeds of its initial public offering (exclusive of any applicable finders’ fees which
might become payable). NorthView had also previously entered into an engagement letter (the “Engagement Letter”) contemplating
the Business Combination Fee. In connection with the Business Combination, NorthView and I-Bankers amended the Business Combination Marketing
Agreement and the Engagement Letter to revise a portion of the Business Combination Fee to be partially payable in NorthView securities
and partially payable in cash upon the closing of the Merger with Profusa, with such securities to be subject to lock-up provisions.
Critical Accounting Policies
Management’s discussion
and analysis of our results of operations and liquidity and capital resources are based on our financial information. We describe our
significant accounting policies in Note 2 – Significant Accounting Policies, of the Notes to Consolidated Financial Statements included
in this report. Our consolidated financial statements have been prepared in accordance with U.S. GAAP. Certain of our accounting policies
require that management apply significant judgments in defining the appropriate assumptions integral to financial estimates. On an ongoing
basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements
are presented fairly and in accordance with U.S. GAAP. Judgments are based on historical experience, terms of existing contracts, industry
trends and information available from outside sources, as appropriate. However, by their nature, judgments are subject to an inherent
degree of uncertainty, and, therefore, actual results could differ from our estimates.
Warrant Liabilities
We account for the warrants
issued in connection with the IPO in accordance with the guidance contained in ASC 815-40. Such guidance provides that because the warrants
do not meet the criteria for equity treatment thereunder, each warrant must be recorded as a liability. Accordingly, we classified each
warrant as a liability at its fair value. This liability is subject to re-measurement at each balance sheet date. With each such re-measurement,
the warrant liabilities will be adjusted to fair value, with the change in fair value recognized in our consolidated statements of operations.
Net Income (Loss) Per Common Stock
We have two categories of
shares, which are referred to as common stock subject to possible redemption and common stock. Earnings and losses are shared pro rata
between the two categories of shares. The 17,404,250 potential shares of common stock for outstanding warrants to purchase our shares
were excluded from diluted earnings per share for the year ended December 31, 2022 and for the period from April 19, 2021 (inception)
through December 31, 2021 because the warrants are contingently exercisable, and the contingencies have not yet been met. As a result,
diluted net income (loss) per share of common stock is the same as basic net income (loss) per share of common stock for the periods presented.
Common Stock Subject to Possible Redemption
Our common stock sold as part
of the Units in the IPO (“public common stock”) contain a redemption feature which allows for the redemption of such public
shares in connection with our liquidation, or if there is a stockholder vote or tender offer in connection with the initial Business Combination.
In accordance with ASC 480-10-S99, we classify public common stock subject to redemption outside of permanent equity as the redemption
provisions are not solely within our control. The public common stock sold as part of the Units in the IPO was issued with other freestanding
instruments (i.e., Public Warrants) and as such, the initial carrying value of public common stock classified as temporary equity was
the allocated proceeds determined in accordance with ASC 470-20. The public common stock is subject to ASC 480-10-S99 and is currently
not redeemable as the redemption is contingent upon the occurrence of events mentioned above. According to ASC 480-10-S99-15, no subsequent
adjustment is needed if it is not probable that the instrument will become redeemable.
Recent Accounting Standards
Our management does not believe
that any recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying
consolidated financial statements.
40
JOBS Act
The JOBS Act contains
provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an “emerging
growth company” under the JOBS Act and are allowed to comply with new or revised accounting pronouncements based on the
effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards,
and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards
is required for non-emerging growth companies. As a result, our consolidated financial statements may not be comparable to companies
that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we are in the
process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain
conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may
not be required to, among other things, (i) provide an independent registered public accounting firm’s attestation report on our
system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may
be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii)
comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the independent
registered public accounting firm’s report providing additional information about the audit and the consolidated financial statements
(auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive
compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply
for a period of five years following the completion of our initial public offering or until we are no longer an “emerging growth
company,” whichever is earlier.
Item 7A. Quantitative and Qualitative
Disclosures about Market Risk
We are a smaller reporting
company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
Item 8.
Consolidated Financial Statements and Supplementary Data
This information appears following
Item 15 of this Report and is included herein by reference.
Item 9. Changes in and Disagreements with
Accountants on Accounting and Financial Disclosure
None.
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 principal executive officer and principal financial and accounting officer (our
“Certifying Officers”), the effectiveness of our disclosure controls and procedures as of December 31, 2022, pursuant to Rule 13a-15(b)
under the Exchange Act. Based upon that evaluation, our Certifying Officers concluded that, as of December 31, 2022, 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.
41
Management’s Report on Internal Controls Over Financial Reporting
Management is responsible
for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) under the
Exchange Act. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with accounting principles
generally accepted in the United States. Because of its inherent limitations, internal control over financial reporting may not prevent
or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls
may become inadequate because of changes in conditions or because the degree of compliance with policies or procedures may deteriorate.
Management conducted, under
the supervision of our principal executive officer and principal financial officer, an evaluation of the effectiveness of our internal
control over financial reporting based on the framework in Internal Control – Integrated Framework (2013) issued by the Committee
of Sponsoring Organizations of the Treadway Commission, commonly referred to as the “COSO” criteria. Based on the assessment
performed, management concluded that our internal control over financial reporting was effective as of December 31, 2022.
This Annual Report on Form
10-K does not include an attestation report of our registered public accounting firm due to a transition period established by rules of
the SEC for 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.
Changes in Internal Control over Financial Reporting
There were no changes in our
internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most
recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting.
ITEM 9B. OTHER INFORMATION.
None.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT
INSPECTIONS.
Not applicable.
42
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Directors and Executive Officers
Our directors and officers are as follows:
Name Age Title
Jack Stover 69 Co-Founder, Director, Chief Executive Officer
Fred Knechtel 62 Co-Founder, Director, Chief Financial Officer
Peter O’Rourke 50 Chairman of the Board, Independent Director
Ed Johnson 62 Independent Director
Lauren Chung 50 Independent Director
Jack Stover — Co-Founder, Director
and Chief Executive Officer
Jack Stover has served as our
Chief Executive Officer and director since inception. From June 2016 to November 2020, Mr. Stover served as president and chief executive
officer of Interpace Biosciences, Inc., a publicly-traded small cap life sciences company providing complex molecular analysis for the
early diagnosis and treatment of cancer and supporting the development of targeted therapeutics. From December 2015 until June 2016, Mr. Stover
served as interim president and chief executive officer of Interpace Biosciences, Inc. Mr. Stover on the board of directors of Interpace
Biosciences, Inc. from August 2005 until November 2020, and was chairman of the audit committee from August 2005 until December 2015.
From June 2016 to December 2016, Mr. Stover was chairman of the audit committee and a member of the board of directors of Viatar
CTC Solutions, Inc. From 2004 to 2008, he served as chief executive officer, president and director of Antares Pharma, Inc., a publicly
held specialty pharmaceutical company (current market cap of ~$700M) then listed on the American Stock Exchange. In addition to other
relevant experience, Mr. Stover was also formerly a partner with PricewaterhouseCoopers (then Coopers and Lybrand), working in the
bioscience industry division in New Jersey. Mr. Stover received his B.A. in Accounting from Lehigh University and is a Certified
Public Accountant. We believe that Mr. Stover is well-qualified to serve as a director of our company based on Mr. Stover’s
experience holding senior leadership positions in the life sciences industry, and his specific experience and skills in the areas of general
operations, financial operations and administration.
Fred Knechtel — Co-Founder, Director
and Chief Financial Officer
Fred
Knechtel has served as our Chief Financial Officer and director since inception. From August 2022 to present, Mr. Knechtel
served as chief financial officer of DiamiR Biosciences. From January 2020 to January 2021, Mr. Knechtel served as chief financial
officer of Interpace Biosciences, Inc. From June 2018 to December 2018, Mr. Knechtel served as chief financial officer of GENEWIZ,
Inc. From November 2014 to November 2017, Mr. Knechtel served as group chief financial officer of Sims Metal Management. From November
2009 to October 2014, Mr. Knechtel served as chief financial officer of Remy International, Inc. Mr. Knechtel received a Bachelor
of Engineering from Stony Brook University and a M.B.A in Finance from Hofstra University. We believe that Mr. Knechtel is well-qualified
to serve as a director of our company based on Mr. Knechtel’s experience holding high level executive positions in the life
sciences industry, and his financial and accounting experience.
Peter O’Rourke — Chairman
of the Board
Peter
O’Rourke has served as our chairman of the board since the effective date of our initial public offering. Since December 2018,
Mr. O’Rourke has served as Managing Partner at TCI Partners, a consulting firm focused on healthcare, aerospace and the public
sector. From November 2020-August 2022, Mr. O’Rourke was President and Director for Western Magnesium, where he
created the U.S. operations strategy and team during the successful technology pilot phase of the company, and led enterprise and defense
business development, government affairs, and communications. From January 2017 to December 2018, Mr. O’Rourke served
as the Acting Secretary and Chief of Staff of the Department of Veteran Affairs. From May 2015 to July 2016, Mr. O’Rourke
served as a principal of Calibre Systems, Inc., a consulting firm. Mr. O’Rourke also served in both the U.S. Navy and Air
Force. Mr. O’Rourke served as Director for AXIM Biotechnologies from July 2020 to present. AXIM is a vertically integrated
research and development company focused on improving the landscape for the diagnosis of ophthalmological conditions such as Dry Eye
Disease (DED) through rapid diagnostic tests. Mr. O’Rourke received a Bachelor of Arts in Political Science from the University
of Tennessee in Knoxville as well as a Master of Science in Logistics and Supply Chain Management from the United States Air Force’s
Institute of Technology. We believe that Mr. O’Rourke is well-qualified to serve as a director of our company based on Mr.
O’Rourke’s leadership and consulting experience in the healthcare industry.
43
Ed Johnson — Director
Ed Johnson has served as
a director since the effective date of our initial public offering. Since March 2020, Mr. Johnson has served as the chief
executive officer of iONEBIOUSA Molecular COVID-19 Technologies, which he founded. Since March 2018, Mr. Johnson has
served as chief executive officer of Johnson Global Ventures, LLC. Since March 2018, Mr. Johnson has served on the
Advisory Board to Advantage Capital Partners. Mr. Johnson received a Bachelor of Science in Marketing from Florida State
University and a M.B.A. from Nova Southeastern University. We believe that Mr. Johnson is well-qualified to serve as a
director of our company based on Mr. Johnson’s healthcare focused experience.
Lauren Chung — Director
Lauren Chung has served as a
director since the effective date of our initial public offering. Since November 2019, Dr. Chung has served as chief executive officer
of MINLEIGH LLC, identifying, evaluating and partnering with companies for investments and strategic, operational, and commercial opportunities,
and venture partner at Yozma Group. From May 2017 to November 2019, Dr. Chung was an Equity Research Managing Director at WestPark
Capital. From August 2016 to April 2017, Dr. Chung as in equity research at Maxim Group. Previously, Dr. Chung founded and served
as chief operating officer and chief compliance officer of Tokum Capital Management, a global healthcare investment fund. Prior to that,
she managed healthcare investment portfolios at institutional investment firms. Dr. Chung serves as director of Todos Medical Ltd.
Dr. Chung previously served as director of Cure Pharmaceutical Holding Corp from August 2019 until November 2021, UltraSight, Inc
from December 2020 to December 2021, and AdiTxt, Inc. from June 2021 until December 2021. Dr. Chung holds a Ph.D. in Neuropathology
from Columbia University-College of Physicians & Surgeons, an M.B.A from Columbia Business School, and a BA with honors in Biochemistry
and Economics from Wellesley College. We believe that Dr. Chung is well-qualified to serve as a director of our company based on
Dr. Chung’s extensive corporate board and investment analysis experience.
Number of Officers and Directors
Our board of directors consists
of five directors. We may not hold an annual meeting of stockholders until after we consummate our initial business combination. 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 bylaws as it deems appropriate.
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
other than an officer or employee of the company or its subsidiaries or any other individual having a relationship which in the opinion
of the company’s board of directors, would interfere with the director’s exercise of independent judgment in carrying out
the responsibilities of a director. Our board of directors have determined that Dr. Chung, Mr. Johnson and Mr. O’Rourke
are “independent directors” as defined in the Nasdaq listing standards and applicable SEC rules. Our independent directors
have regularly scheduled meetings at which only independent directors are present.
Committees of the Board of Directors
Our board of directors has
three standing committees: an audit committee, a compensation committee and a nominating and corporate governance committee. Each committee
operates under a charter that has been approved by our board and has the composition and responsibilities described below. Our audit committee,
compensation committee and nominating and corporate governance committee is composed solely of independent directors.
Audit Committee
The members of our audit committee
are Dr. Chung, Mr. Johnson and Mr. O’Rourke. Dr. Chung serves as chair of the audit committee. Under the Nasdaq
listing standards and applicable SEC rules, we are required to have at least three members on the audit committee. The rules of Nasdaq
and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors.
Dr. Chung, Mr. Johnson and Mr. O’Rourke qualify as independent directors under applicable rules. Each member of the
audit committee is financially literate and our board of directors has determined that Dr. Chung qualifies as an “audit committee
financial expert” as defined in applicable SEC rules.
We have adopted an audit committee
charter, which details the principal functions of the audit committee, including:
44
Compensation Committee
The members of our Compensation
Committee are Mr. Johnson, Dr. Chung, and Mr. O’Rourke. Mr. Johnson serves as chair of the compensation committee.
Under the Nasdaq listing standards and applicable SEC rules, we are required to have at least two members on the compensation committee,
all of whom must be independent.
We have adopted a compensation
committee charter, which details the principal functions of the compensation committee, including:
● reviewing our executive compensation policies and plans;
The charter also provides
that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel or
other adviser and will be directly responsible for the appointment, compensation and oversight of the work of any such adviser. However,
before engaging or receiving advice from a compensation consultant, external legal counsel or any other adviser, the compensation committee
will consider the independence of each such adviser, including the factors required by Nasdaq and the SEC.
Nominating and Corporate Governance Committee
The members of our nominating
and corporate governance are Dr. Chung, Mr. O’Rourke and Mr. Johnson. Dr. Chung serves as chair of the nominating and
corporate governance committee.
The primary purposes of our
nominating and corporate governance committee will be to assist the board in:
45
The nominating and corporate
governance committee is governed by a charter that complies with the rules of Nasdaq.
Director Nominations
Our nominating and corporate
governance committee will recommend to the board of directors candidates for nomination for election at the annual meeting of the stockholders.
The board of directors will also consider director candidates recommended for nomination by our stockholders during such times as they
are seeking proposed nominees to stand for election at the next annual meeting of stockholders (or, if applicable, a special meeting of
stockholders).
We have not formally established
any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying
and evaluating nominees for director, the board of directors considers educational background, diversity of professional experience, knowledge
of our business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our stockholders.
Prior to our initial business combination, holders of our public shares will not have the right to recommend director candidates for nomination
to our board of directors.
Code of Ethics
We have adopted a Code of
Ethics applicable to our directors, officers and employees. We have filed a copy of our form of Code of Ethics and our audit committee
charter as exhibits to the registration statement we filed in connection with our initial public offering. You are able to review these
documents by accessing our public filings at the SEC’s website at www.sec.gov. In addition, a copy of the Code of Ethics
will be provided without charge upon request from us. We intend to disclose any amendments to or waivers of certain provisions of our
Code of Ethics in a Current Report on Form 8-K.
Conflicts of Interest
Each of our officers and directors
presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which
such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our
officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current
fiduciary or contractual obligations, he or she will honor these fiduciary obligations under applicable law. We do not believe, however,
that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our business
combination. Our amended and restated certificate of incorporation provides that we renounce our interest in any corporate opportunity
offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director
or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable
for us to pursue.
Potential investors should
also be aware of the following other potential conflicts of interest:
46
The conflicts described above
may not be resolved in our favor.
In
general, officers and directors of a corporation incorporated under the laws of the State of Delaware are required to present business
opportunities to a corporation if:
● the corporation could financially undertake the opportunity;
● the opportunity is within the corporation’s line of business; and
We are not prohibited from
pursuing an initial business combination with a company that is affiliated with our initial stockholders, officers or directors. In the
event we seek to complete our initial business combination with such a company, we, or a committee of independent directors, would obtain
an opinion from an independent investment banking firm which is a member of FINRA, or from an independent accounting firm, that such an
initial business combination is fair to our company from a financial point of view.
In
the event that we submit our initial business combination to our public stockholders for a vote, our sponsor, executive officers, and
directors have agreed to vote their founder shares and any public shares purchased in or after our initial public offering in favor of
our initial business combination.
The
following table summarizes the relevant pre-existing fiduciary or contractual obligations of our officers and directors:
Individual Entity Position at affiliated entity
Jack Stover Onconova Therapeutics, Inc. Director
Fred Knechtel DiamiR Biosciences CFO
Peter O’Rourke TCI Partners Managing Partner
AXIM Biotechnologies Director
Ed Johnson iONEBIOSUSA CEO
Johnson Global Ventures LLC CEO
Advantage Capital Partners Advisor
Lauren Chung MINLEIGH, LLC CEO
Todos Medical Ltd. Director
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Limitation on Liability and Indemnification
of Officers and Directors
Our amended and restated certificate
of incorporation provides that our officers and directors will be indemnified by us to the fullest extent authorized by Delaware law,
as it now exists or may in the future be amended. In addition, our amended and restated certificate of incorporation provides that our
directors will not be personally liable for monetary damages to us for breaches of their fiduciary duty as directors, except to the extent
such exemption from liability or limitation thereof is not permitted by the DGCL.
We entered into agreements
with our officers and directors to provide contractual indemnification in addition to the indemnification provided for in our amended
and restated certificate of incorporation. Our bylaws also permit us to maintain insurance on behalf of any officer, director or employee
for any liability arising out of his or her actions, regardless of whether Delaware law would permit such indemnification. We have obtained
a policy of directors’ and officers’ liability insurance that insures our officers and directors against the cost of defense,
settlement or payment of a judgment in some circumstances and insures us against our obligations to indemnify our officers and directors.
These provisions may discourage
stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty. These provisions also may have the effect
of reducing the likelihood of derivative litigation against officers and directors, even though such an action, if successful, might otherwise
benefit us and our stockholders. Furthermore, a stockholder’s investment may be adversely affected to the extent we pay the costs
of settlement and damage awards against officers and directors pursuant to these indemnification provisions.
We believe that these provisions,
the directors’ and officers’ liability insurance and the indemnity agreements are necessary to attract and retain talented
and experienced officers and directors.
ITEM 11. EXECUTIVE COMPENSATION
Executive Officer and Director Compensation
None of our executive officers
or directors have received any cash compensation for services rendered to us. Until the earlier of consummation of our initial business
combination and our liquidation, beginning on the closing date of our initial public offering, we have agreed to pay an affiliate of one
of our officers a total of $5,000 per month for office space, utilities, secretarial support and other administrative and consulting services.
Our executive 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
their affiliates.
After the completion of our
initial business combination, directors or members of our management team who remain with us may be paid consulting, management or other
fees from the combined company. All of these fees will be fully disclosed to stockholders, to the extent then known, in the tender offer
materials or proxy solicitation materials furnished to our stockholders in connection with a proposed business combination. It is unlikely
the amount of such compensation will be known at the time, because the directors of the post-combination business will be responsible
for determining executive officer and director compensation. Any compensation to be paid to our executive officers will be determined
by a compensation committee constituted solely by independent directors.
We do not intend to take any
action to ensure that members of our management team maintain their positions with us after the consummation of our initial business combination,
although it is possible that some or all of our executive officers and directors may negotiate employment or consulting arrangements to
remain with us after the initial business combination. The existence or terms of any such employment or consulting arrangements to retain
their positions with us may influence our management’s motivation in identifying or selecting a target business but we do not believe
that the ability of our management to remain with us after the consummation of our initial business combination will be a determining
factor in our decision to proceed with any potential business combination. We are not party to any agreements with our executive officers
and directors that provide for benefits upon termination of employment.
Compensation Committee Interlocks and Insider Participation
None of our executive officers
currently serves, and in the past year has not served, as a member of the board of directors or compensation committee of any entity that
has one or more executive officers serving on our board of directors.
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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 common stock as of February 14, 2023 based on information obtained from the persons
named below, with respect to the beneficial ownership of our shares of common stock, by:
● each of our executive officers and directors; and
● all our executive 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 shares of common stock beneficially
owned by them. The following table does not reflect record or beneficial ownership of the private placement warrants as these warrants
are not exercisable within 60 days of the date of this Report.
Common Stock
Peter O’Rourke(5) — —
Ed Johnson(5) — —
Lauren Chung(5) — —
All directors and executive officers as a group (5 individuals) 4,743,750 19.6 %
Lighthouse Investment Partners, LLC (6) 1,488,384 6.2 %
* Less than 1%.
(2) Interests shown consist solely of founder shares.
(3) Based on 24,168,750 shares of common stock outstanding.
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
In April 2021, our sponsor
purchased 5,175,000 founder shares for an aggregate purchase price of $25,000. In October 2021, our sponsor forfeited 862,500 founder
shares. On December 20, 2021, we effected a 1.1- for-1 stock dividend of our common stock, resulting in an aggregate of 4,743,750
founder shares (up to 618,750 of which are subject to forfeiture).
Our sponsor purchased an aggregate
of 5,162,500 private placement warrants, each exercisable to purchase one share of common stock at $11.50 per share, at a price of $1.00
per warrant ($5,162,500 in the aggregate), in a private placement that closed simultaneously with the closing of our initial public offering.
The private placement warrants (including the shares of common stock issuable upon exercise of the private placement warrants) may not,
subject to certain limited exceptions, be transferred, assigned or sold until 30 days after the completion of our initial business
combination.
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-current 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. Our executive officers and directors currently have certain relevant
fiduciary duties or contractual obligations that may take priority over their duties to us.
We entered into an Administrative
Services Agreement pursuant to which we pay NorthView Sponsor I, LLC, an affiliate of one of our officers, a total of $5,000 per month
for office space, utilities, secretarial support and other administrative and consulting services. 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, NorthView Sponsor I, LLC will be paid a total of $105,000 ($5,000 per month) for office space,
utilities, secretarial support and other administrative and consulting services and will be entitled to be reimbursed for any out-of-pocket
expenses.
Our sponsor, executive 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.
Prior to the closing of our
initial public offering, our sponsor loaned us $204,841 to be used for a portion of the expenses of our initial public offering. These
loans were non-interest bearing, unsecured and were repaid on the closing of our initial public offering.
In addition, in order to finance
transaction costs in connection with an intended initial business combination, our initial stockholders or an affiliate of our initial
stockholders 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, at the option of the lender, convertible into warrants
at a price of $1.00 per warrant of the post business combination entity. The warrants would be identical to the private placement warrants,
including as to exercise price, exercisability and exercise period. The terms of such loans, 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 initial stockholders or an affiliate
of our initial stockholders or certain officers and directors 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.
We may pay consulting, finder
or success fees to our initial stockholders, officers, directors or their affiliates for assisting us in consummating our initial business
combination. Other than these consulting, finder or success fees, no compensation of any kind will be paid by us to our initial stockholders,
executive officers and directors, or any of their respective affiliates, for services rendered prior to or in connection with the completion
of an initial business combination. However, these individuals 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 initial stockholders, officers, directors or our
or their affiliates.
After our initial business
combination, members of our management team who remain with us may be paid consulting, management or other fees from the combined company
with any and all amounts being fully disclosed to our stockholders, to the extent then known, in the tender offer or proxy solicitation
materials, as applicable, furnished to our stockholders. It is unlikely the amount of such compensation will be known at the time of distribution
of such tender offer materials or at the time of a stockholder meeting held to consider our initial business combination, as applicable,
as it will be up to the directors of the post-combination business to determine executive officer and director compensation.
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We entered into a registration
rights agreement with respect to the founder shares and private placement warrants (and underlying securities).
Policy for Approval of Related Party Transactions
The audit committee of our
board of directors has adopted a policy setting forth the policies and procedures for its review and approval or ratification of “related
party transactions.” Pursuant to the policy, the audit committee will consider (i) the relevant facts and circumstances of
each related party transaction, including if the transaction is on terms comparable to those that could be obtained in arm’s-length
dealings with an unrelated third party, (ii) the extent of the related party’s interest in the transaction, (iii) whether
the transaction contravenes our code of ethics or other policies, (iv) whether the audit committee believes the relationship underlying
the transaction to be in the best interests of the company and its stockholders and (v) the effect that the transaction may have
on a director’s status as an independent member of the board and on his or her eligibility to serve on the board’s committees.
Management will present to the audit committee each proposed related party transaction, including all relevant facts and circumstances
relating thereto. Under the policy, we may consummate related party transactions only if our audit committee approves or ratifies the
transaction in accordance with the guidelines set forth in the policy. The policy will not permit any director or executive officer to
participate in the discussion of, or decision concerning, a related person transaction in which he or she is the related party.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND
SERVICES.
The following is a summary of fees paid or to
be paid to Marcum LLP, or Marcum, for services rendered.
Audit Fees. During
the year ended December 31, 2022 and for the period from April 19, 2021 (Inception) through December 31, 2021, fees for our independent
registered public accounting firm were approximately $128,750 and $61,800 for the services Marcum performed in connection with the audit
of our December 31, 2022 and 2021 consolidated financial statements included in this Annual Report on Form 10K.
Audit-Related Fees. During
the year ended December 31, 2022 and for the period from April 19, 2021 (Inception) through December 31, 2021, fees for our independent
registered public accounting firm were approximately $0 for the services Marcum performed in connection with our Initial Public Offering.
Tax Fees. During the
year ended December 31, 2022 and for the period from April 19, 2021 (Inception) through December 31, 2021, our independent registered
public accounting firm did not render services to us for tax compliance, tax advice and tax planning.
All Other Fees. During
the year ended December 31, 2022 and for the period from April 19, 2021 (Inception) through December 31, 2021, there were no fees billed
for products and services provided by our independent registered public accounting firm other than those set forth above.
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).
We hereby 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.
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