10-K
1
f10k2020_vickersvan1.htm
ANNUAL REPORT
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
☒
Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended December 31, 2020
Commission File Number 001-39852
VICKERS VANTAGE CORP. I
Cayman Islands 6770 N/A
1
Harbourfront Avenue, #16-06
Keppel Bay Tower, Singapore 098632
Singapore
(Address of Principal Executive Offices)
Registrant’s
telephone number, including area code: (646) 974-8301
Securities registered pursuant to Section
12(b) of the Act:
Title of Each Class Trading Symbol(s) Name of each exchange on which registered
Ordinary Shares, par value $0.0001 per share VCKA The Nasdaq Stock Market LLC
Securities registered pursuant to Section
12(g) of the Act: None
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
No ☒
Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes ☐ No ☒
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act
of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has
been subject to such filing requirement for the past 90 days. Yes ☒ No ☐
Indicate
by check mark whether the registrant has submitted electronically, if any, every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required
to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth
company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting
company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☒ Smaller reporting company ☒
Emerging growth company ☒
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☒ No ☐
As of June 30, 2020, the last business
day of the registrant’s most recently completed second fiscal quarter, the registrant’s ordinary shares were not publicly
traded. Accordingly, there was no market value for the registrant’s ordinary shares on such date.
As of March 31, 2021, 17,250,000 ordinary
shares, par value $0.0001 per share, were issued and outstanding.
Documents Incorporated by Reference: None.
VICKERS VANTAGE CORP. I
FORM 10-K
TABLE OF CONTENTS
PART I
Item 1. Business 1
Item 1A. Risk Factors 6
Item 1B. Unresolved Staff Comments 27
Item 2. Properties 27
Item 3. Legal Proceedings 27
Item 4. Mine Safety Disclosures 27
PART II
Item 6. Selected Financial Data 29
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 31
Item 8. Financial Statements and Supplementary Data 31
Item 9A. Controls and Procedures 31
Item 9B. Other Information 32
PART III
Item 10. Directors, Executive Officers and Corporate Governance 33
Item 11. Executive Compensation 36
Item 14. Principal Accounting Fees and Services 38
PART IV
Item 15. Exhibits, Financial Statement Schedules 39
i
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS; SUMMARY OF RISK FACTORS
Certain statements in this Annual Report on
Form 10-K (“Annual Report”) may constitute “forward-looking statements” for purposes of the federal
securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management
team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer
to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are
forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,”
“estimate,” “expect,” “intend,” “may,” “might,” “plan,”
“possible,” “potential,” “predict,” “project,” “should,” “would”
and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement
is not forward-looking. Forward-looking statements in this Annual Report may include, for example, statements about:
● our ability to select an appropriate target business or businesses;
● our ability to complete our initial business combination;
● our pool of prospective target businesses;
● our public securities’ potential liquidity and trading;
● the lack of a market for our securities;
● the trust account not being subject to claims of third parties; or
● our financial performance.
The forward-looking statements contained
in this Annual Report are based on our current expectations and beliefs concerning future developments and their potential effects
on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements
involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results
or performance to be materially different from those expressed or implied by these forward-looking statements. These risks
and uncertainties include, but are not limited to, those factors described under the section of this Annual Report entitled “Risk
Factors”. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect,
actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation
to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except
as may be required under applicable securities laws.
ii
Summary of Risk Factors
An investment in our securities involves
a high degree of risk. The occurrence of one or more of the events or circumstances described in the section titled “Risk
Factors,” alone or in combination with other events or circumstances, may materially adversely affect our business, financial
condition and operating results. In that event, the trading price of our securities could decline, and you could lose all or part
of your investment. Such risks include, but are not limited to:
iii
iv
PART I
ITEM 1. BUSINESS
In this Annual Report
on Form 10-K (the “Form 10-K”), references to the “Company” and to “we,” “us,”
and “our” refer to Vickers Vantage Corp. I
We are a Cayman Islands
company incorporated on February 21, 2020 as an exempted company with limited liability for the purpose of effecting a merger,
share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or
more businesses or entities (the “Business Combination”). Our efforts to identify a prospective target business will
not be limited to a particular industry or geographic region.
The registration statement
for our initial public offering was declared effective on January 6, 2021. On January 11, 2021, we consummated the initial public
offering of 13,800,000 units (each, a “Unit” and collectively, the “Units”) at $10.00 per Unit, including
1,800,000 units subject to the underwriters’ over-allotment option. Each Unit consists of one ordinary share, $.0001 par
value (” Ordinary Shares “), of the Company, and one-half of one redeemable warrant (each, a “Public Warrant”).
Each Public Warrant entitles the holder to purchase one ordinary share at a price of $11.50 per share, subject to adjustment.
Simultaneously with
the closing of the initial public offering, we consummated the private placement (the “Private Placement”) of 6,840,000
warrants (each, a “Private Placement Warrant” and collectively, the “Private Placement Warrants”) at a
price of $0.75 per Private Placement Warrant, generating gross proceeds of $5,130,000. The Private Placement Warrants were purchased
by the Company’s Sponsors, Vickers Venture Fund VI Pte Ltd and Vickers Venture Fund VI (Plan) Pte Ltd. Each Private Placement
Warrant is exercisable for one ordinary share at a price of $11.50 per share.
$139,380,000 ($10.10
per Unit) of the net proceeds of the sale of the Units in the Initial Public Offering, the Over-allotment and the sale of the Private
Placement Warrants, is held in a trust account (“Trust Account”), and invested only in U.S. government securities,
within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less or in any open-ended
investment company that holds itself out as a money market fund selected by the Company meeting the conditions of paragraph (d)
of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business
Combination and (ii) the distribution of the Trust Account.
Effecting a Business Combination
General
We are not presently
engaged in, and we will not engage in, any substantive commercial business for an indefinite period of time. We intend to utilize
cash derived from the proceeds of our initial public offering and the private placement of Private Placement Warrants, our capital
stock, debt or a combination of these in effecting a business combination. Although substantially all of the net proceeds of the
initial public offering and the private placement of Private Placement Warrants are intended to be applied generally toward effecting
a business combination, the proceeds are not otherwise being designated for any more specific purposes. A business combination
may involve the acquisition of, or merger with, a company which does not need substantial additional capital but which desires
to establish a public trading market for its shares, while avoiding what it may deem to be adverse consequences of undertaking
a public offering itself. These include time delays, significant expense, loss of voting control and compliance with various Federal
and state securities laws. In the alternative, we may seek to consummate a business combination with a company that may be financially
unstable or in its early stages of development or growth. While we may seek to effect simultaneous business combinations with more
than one target business, we will probably have the ability, as a result of our limited resources, to effect only a single business
combination.
Sources of Target Businesses
We anticipate that
target business candidates will be brought to our attention from various unaffiliated sources, including investment bankers and
private investment funds. Target businesses may be brought to our attention by such unaffiliated sources as a result of being solicited
by us through calls or mailings. These sources may also introduce us to target businesses in which they think we may be interested
on an unsolicited basis, since many of these sources will have read this annual report and know what types of businesses we are
targeting. Our officers and directors, as well as their affiliates, and our other shareholders may also bring to our attention
target business candidates that they become aware of through their business contacts as a result of formal or informal inquiries
or discussions they may have, as well as attending trade shows or conventions. In addition, we expect to receive a number of proprietary
deal flow opportunities that would not otherwise necessarily be available to us as a result of the track record and business relationships
of our officers and directors. We may also determine to engage the services of professional firms or other individuals that specialize
in business acquisitions on a formal basis, in which event we may pay a finder’s fee, consulting fee or other compensation
to be determined in an arm’s length negotiation based on the terms of the transaction. If we decide to enter into a business
combination with a target business that is affiliated with our officers, directors or initial shareholders, we will do so only
if we have obtained an opinion from an independent investment banking firm or another independent entity that commonly renders
valuation opinions that the business combination is fair to our unaffiliated shareholders from a financial point of view.
Selection of a Target Business and Structuring
of a Business Combination
Subject to the limitations
that a target business have a fair market value of at least 80% of the balance in the Trust Account (excluding deferred underwriting
fees and taxes payable on the income earned on the trust account) at the time of the execution of a definitive agreement for our
initial business combination, as described below in more detail, our management will have virtually unrestricted flexibility in
identifying and selecting a prospective target business. We have not established any other specific attributes or criteria (financial
or otherwise) for prospective target businesses. In evaluating a prospective target business, our management may consider a variety
of factors, including one or more of the following:
● financial condition and results of operation;
● growth potential;
● brand recognition and potential;
● experience and skill of management and availability of additional personnel;
● capital requirements;
● competitive position;
● barriers to entry;
● stage of development of the products, processes or services;
● existing distribution and potential for expansion;
● impact of regulation on the business;
● regulatory environment of the industry;
● costs associated with effecting the business combination;
● macro competitive dynamics in the industry within which the company competes.
These criteria are
not intended to be exhaustive. Any evaluation relating to the merits of a particular business combination will be based, to the
extent relevant, on the above factors as well as other considerations deemed relevant by our management in effecting a business
combination consistent with our business objective. In evaluating a prospective target business, we will conduct an extensive due
diligence review which will encompass, among other things, meetings with incumbent management and inspection of facilities, as
well as review of financial and other information which is made available to us. This due diligence review will be conducted either
by our management or by unaffiliated third parties we may engage, although we have no current intention to engage any such third
parties.
The time and costs
required to select and evaluate a target business and to structure and complete the business combination cannot presently be ascertained
with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business
with which a business combination is not ultimately completed will result in a loss to us and reduce the amount of capital available
to otherwise complete a business combination.
Fair Market Value of Target Business
Pursuant to Nasdaq
listing rules, the target business or businesses that we acquire must collectively have a fair market value equal to at least 80%
of the balance of the funds in the trust account (excluding deferred underwriting fees and taxes payable on the income earned on
the trust account) at the time of the execution of a definitive agreement for our initial business combination, although we may
acquire a target business whose fair market value significantly exceeds 80% of the trust account balance. We currently anticipate
structuring a business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may,
however, structure a business combination where we merge directly with the target business or where we acquire less than 100% of
such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders
or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50%
or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient
for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended. Even if the
post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business
combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target
and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number
of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling
interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately
prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business
combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the
post-transaction company, only the portion of such business or businesses that is owned or acquired is what will be valued for
purposes of the 80% fair market value test. In order to consummate such an acquisition, we may issue a significant amount of our
debt or equity securities to the sellers of such businesses and/or seek to raise additional funds through a private offering of
debt or equity securities. Since we have no specific business combination under consideration, we have not entered into any such
fund raising arrangement and have no current intention of doing so. The fair market value of the target will be determined by our
board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential
sales, earnings, cash flow and/or book value). If our board is not able to independently determine that the target business has
a sufficient fair market value, we will obtain an opinion from an unaffiliated, independent investment banking firm, or another
independent entity that commonly renders valuation opinions, with respect to the satisfaction of such criteria. We will not be
required to obtain an opinion from an independent investment banking firm, or another independent entity that commonly renders
valuation opinions, as to the fair market value if our board of directors independently determines that the target business complies
with the 80% threshold.
Lack of Business Diversification
Our business combination
must be with a target business or businesses that collectively satisfy the minimum valuation standard at the time of such acquisition,
as discussed above, although this process may entail the simultaneous acquisitions of several operating businesses at the same
time. Therefore, at least initially, the prospects for our success may be entirely dependent upon the future performance of a single
business. Unlike other entities which may have the resources to complete several business combinations of entities operating in
multiple industries or multiple areas of a single industry, it is probable that we will not have the resources to diversify our
operations or benefit from the possible spreading of risks or offsetting of losses. By consummating a business combination with
only a single entity, our lack of diversification may:
If we determine to
simultaneously acquire several businesses and such businesses are owned by different sellers, we will need for each of such sellers
to agree that our purchase of its business is contingent on the simultaneous closings of the other acquisitions, which may make
it more difficult for us, and delay our ability, to complete the business combination. With multiple acquisitions, we could also
face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence
investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations
and services or products of the acquired companies in a single operating business.
Limited Ability to Evaluate the Target
Business’ Management
Although we intend
to scrutinize the management of a prospective target business when evaluating the desirability of effecting a business combination,
we cannot assure you that our assessment of the target business’ management will prove to be correct. In addition, we cannot
assure you that the future management will have the necessary skills, qualifications or abilities to manage a public company. Furthermore,
the future role of our officers and directors, if any, in the target business following a business combination cannot presently
be stated with any certainty. While it is possible that some of our key personnel will remain associated in senior management or
advisory positions with us following a business combination, it is unlikely that they will devote their full time efforts to our
affairs subsequent to a business combination. Moreover, they would only be able to remain with the company after the consummation
of a business combination if they are able to negotiate employment or consulting agreements in connection with the business combination.
Such negotiations would take place simultaneously with the negotiation of the business combination and could provide for them to
receive compensation in the form of cash payments and/or our securities for services they would render to the company after the
consummation of the business combination. Additionally, our officers and directors may not have significant experience or knowledge
relating to the operations of the particular target business.
Following a business
combination, we may seek to recruit additional managers to supplement the incumbent management of the target business. We cannot
assure you that we will have the ability to recruit additional managers, or that any such additional managers we do recruit will
have the requisite skills, knowledge or experience necessary to enhance the incumbent management.
Shareholders May Not Have the Ability
to Approve an Initial Business Combination
In connection with
any proposed business combination, we will either (1) seek stockholder approval of our initial business combination at a meeting
called for such purpose at which shareholders may seek to redeem their shares, regardless of whether they vote for or against the
proposed business combination, into their pro rata share of the aggregate amount then on deposit in the trust account (net
of taxes payable), or (2) provide our shareholders with the opportunity to sell their shares to us by means of a tender offer (and
thereby avoid the need for a stockholder vote) for an amount equal to their pro rata share of the aggregate amount then
on deposit in the trust account (net of taxes payable), in each case subject to the limitations described herein. If we determine
to engage in a tender offer, such tender offer will be structured so that each stockholder may tender all of his, her or its shares
rather than some pro rata portion of his, her or its shares. The decision as to whether we will seek stockholder approval
of a proposed business combination or will allow shareholders to sell their shares to us in a tender offer will be made by us,
solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms
of the transaction would otherwise require us to seek stockholder approval. In the case of a tender offer, we will file tender
offer documents with the SEC which will contain substantially the same financial and other information about the initial business
combination as is required under the SEC’s proxy rules. We will consummate our initial business combination only if we have
net tangible assets of at least $5,000,001 upon such consummation and, if we seek stockholder approval, a majority of the outstanding
ordinary shares voted are voted in favor of the business combination.
Submission of Our Initial Business Combination
to a Shareholder Vote
In the event that we seek shareholder approval
of our initial business combination, we will distribute proxy materials and, in connection therewith, provide our public shareholders
with the redemption rights described above upon completion of the initial business combination.
If we seek shareholder approval, we will
complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law, which requires the
affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. A quorum for such meeting
will be present if the holders of a majority of issued and outstanding shares entitled to vote at the meeting are represented in
person or by proxy. Our initial shareholders will count toward this quorum and, pursuant to that certain letter agreement, our
Sponsor, officers and directors have agreed to vote their Founder Shares and any public shares purchased during or after the Public
Offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. Each public
shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction or
whether they were a public shareholder on the record date for the shareholder meeting held to approve the proposed transaction.
Our amended and restated memorandum and articles of association require that at least five days’ notice will be given of
any such shareholder meeting.
Redemption Rights
At any meeting called
to approve an initial business combination, public shareholders may seek to redeem their shares, regardless of whether they vote
for or against the proposed business combination, or do not vote at all, their pro rata share of the aggregate amount then
on deposit in the trust account as of two business days prior to the consummation of the initial business combination, less any
taxes then due but not yet paid. Alternatively, we may provide our public shareholders with the opportunity to sell their ordinary
shares to us through a tender offer (and thereby avoid the need for a stockholder vote) for an amount equal to their pro rata
share of the aggregate amount then on deposit in the trust account, less any taxes then due but not yet paid.
Notwithstanding the
foregoing, a public stockholder, together with any affiliate of his or any other person with whom he is acting in concert or as
a “group” (as defined in Section 13(d)(3) of the Exchange Act) will be restricted from seeking redemption rights with
respect to 20% or more of the shares sold in the Initial Public Offering. Such a public stockholder would still be entitled to
vote against a proposed business combination with respect to all shares owned by him or his affiliates.
Liquidation if No Business Combination
If we are unable to
complete our initial business combination within 12 months from the closing of our initial public offering (or up to 18 months
if we extend the period of time we have to consummate an initial business combination as described below), we will (i) cease all
operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than five business days thereafter,
redeem 100% of the outstanding public shares which redemption will completely extinguish public shareholders’ rights as shareholders
(including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as
reasonably possible following such redemption, subject to the approval of our remaining holders of ordinary shares and our board
of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of the company, subject (in the case
of (ii) and (iii) above) to our obligations to provide for claims of creditors and the requirements of applicable law.
Notwithstanding the
foregoing, if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may, by
resolution of our board if requested by our sponsors, extend the period of time to consummate a business combination up to two
times, each by an additional three months (for a total of up to 18 months to complete a business combination), subject to the sponsors
depositing additional funds into the trust account as set forth below. Our shareholders will not be entitled to vote or redeem
their shares in connection with any such extensions. Pursuant to the terms of our amended and restated memorandum and articles
of association and the trust agreement entered into between us and Continental Stock Transfer & Trust Company, in order
for the time available for us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees
must deposit into the trust account $900,000, or $1,035,000 if the underwriters’ over-allotment option is exercised in full
($0.075 per unit in either case), on or prior to the date of the applicable deadline, for each of the available three month extensions
providing a total possible business combination period of 18 months for a total payment value of $1,800,000, or $2,070,000 if the
underwriters’ over-allotment option is exercised in full ($0.15 per unit in either case). Any such deposits will be in the
form of non-interest bearing loans to us. If we complete our initial business combination, we will, at the option of our sponsors,
repay such loaned amounts or convert a portion or all of the total loan amount into warrants at a price of $0.75 per warrant, which
warrants will be identical to the private warrants. If we do not complete a business combination, we will repay such loans only
from funds held outside of the trust account. Furthermore, the letter agreement with our initial shareholders contains a provision
pursuant to which our sponsors have agreed to waive their right to be repaid for such loans to the extent there is insufficient
funds held outside of the trust account in the event that we do not complete a business combination. Our sponsors and their affiliates
or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination.
If we are unable to
complete our initial business combination within the allotted time period, we may propose to amend our amended and restated memorandum
and articles of association to modify the timing by which we must consummate our initial business combination, which proposal must
be approved by our shareholders. In such event, our public shareholders shall be entitled to receive funds from the trust account
if they redeem their shares in connection with such shareholder vote.
In connection with
our redemption of 100% of our issued and outstanding public shares for a portion of the funds held in the trust account, each public
shareholder will receive a full pro rata portion of the amount then in the trust account, plus any pro rata interest earned on
the funds held in the trust account and not previously released to us and less up to $50,000 for liquidation expenses. Holders
of warrants will receive no proceeds in connection with the liquidation with respect to such warrants, which will expire worthless.
Competition
In identifying, evaluating
and selecting a target business, we may encounter intense competition from other entities having a business objective similar to
ours. Many of these entities are well established and have extensive experience identifying and effecting business combinations
directly or through affiliates. Many of these competitors possess greater technical, human and other resources than us and our
financial resources will be relatively limited when contrasted with those of many of these competitors. Our ability to compete
in acquiring certain sizable target businesses may be limited by our available financial resources.
The following also
may not be viewed favorably by certain target businesses:
In recent years, and especially since the
fourth quarter of 2020, the number of special purpose acquisition companies that have been formed has increased substantially.
Many potential targets for special purpose acquisition companies have already entered into an initial business combination, and
there are still many special purpose acquisition companies seeking targets for their initial business combination, as well as many
such companies currently in registration. As a result, at times, fewer attractive targets may be available, and it may require
more time, more effort and more resources to identify a suitable target and to consummate an initial business combination.
If we succeed in effecting a business combination,
there will be, in all likelihood, intense competition from competitors of the target business. We cannot assure you that, subsequent
to a business combination, we will have the resources or ability to compete effectively.
Employees
We have two executive
officers. These individuals are not obligated to devote any specific number of hours to our matters and intend to devote only as
much time as they deem necessary to our affairs. The amount of time they will devote in any time period will vary based on whether
a target business has been selected for the business combination and the stage of the business combination process the company
is in. Accordingly, once management locates a suitable target business to acquire, they will spend more time investigating such
target business and negotiating and processing the business combination (and consequently spend more time to our affairs) than
they would prior to locating a suitable target business. We presently expect each of our executive officers to devote such amount
of time as they reasonably believe is necessary to our business. We do not intend to have any full time employees prior to the
consummation of a business combination.
Facilities
We currently maintain
our executive offices at 1 Harbourfront Avenue, #16-06, Keppel Bay Tower, Singapore 098632, Singapore. Such space, utilities and
secretarial and administrative services will be provided to us free of charge by an affiliate of our executive officers. We consider
our current office space adequate for our current operations.
ITEM 1A. RISK FACTORS
An
investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together
with the other information contained in this Annual Report on Form 10-K, the prospectus associated with our Initial
Public Offering and the registration statement of which such prospectus forms a part, before making a decision to invest in our
securities, before making a decision to invest in our units. If any of the following events occur,
our business, financial condition and operating results may be materially adversely affected. In that event, the trading price
of our securities could decline, and you could lose all or part of your investment.
Risks
Relating to Searching for and Consummating a Business Combination
The
requirement that we complete our initial business combination within 12 months from the closing of the Initial Public Offering
(or 18 months from the closing of the Initial Public Offering if we have extended the period of time to consummate an initial business
combination as described herein) may give potential target businesses leverage over us in negotiating our initial business combination
and may limit the amount of time we have to conduct due diligence on potential business combination targets as we approach our
dissolution deadline, which could undermine our ability to consummate our initial business combination on terms that would produce
value for our shareholders.
Any
potential target business with which we enter into negotiations concerning our initial business combination will be aware that
we must consummate our initial business combination within 12 months from the closing of the Initial Public Offering (or up to
18 months from the closing of the Initial Public Offering if we have extended the period of time to consummate an initial business
combination as described herein). Consequently, such target businesses may obtain leverage over us in negotiating our initial business
combination, knowing that if we do not complete our initial business combination with that particular target business, we may be
unable to complete our initial business combination with any target business. This risk will increase as we get closer to the timeframe
described above. In addition, we may have limited time to conduct due diligence and may enter into our initial business combination
on terms that we would have rejected upon a more comprehensive investigation.
We
may not be able to consummate our initial business combination within the required time period, in which case we would cease all
operations except for the purpose of winding up and we would redeem our public shares and liquidate.
We
must complete our initial business combination within 12 months from the closing of the Initial Public Offering (or up to 18 months
from the closing of the Initial Public Offering if we have extended the period of time to consummate an initial business combination
as described herein). We may not be able to find a suitable target business and consummate our initial business combination within
such time period. Our ability to complete our initial business combination may be negatively impacted by general market conditions,
volatility in the capital and debt markets and the other risks described herein. If we are unable to consummate our initial business
combination within the required time period, we will, as promptly as reasonably possible but not more than five business days thereafter,
distribute the aggregate amount then on deposit in the trust account (net of taxes payable, and less up to $50,000 of interest
to pay liquidation expenses), pro rata to our public shareholders by way of redemption and cease all operations except for the
purposes of winding up of our affairs, as further described herein. This redemption of public shareholders from the trust account
shall be effected as required by function of our memorandum and articles of association and prior to any voluntary winding up.
Our
public shareholders will not be entitled to vote or redeem their shares in connection with each of our potential three-month extensions.
If
we are not able to consummate our initial business combination within 12 months, we may, by resolution of our board if requested
by our Sponsors, extend the period of time to consummate a business combination up to two times, each by an additional three months,
as long as our Sponsors or their affiliates or designees, prior to the applicable deadline, deposits into the trust account $1,035,000
($0.075 per unit, an aggregate of $2,070,000, $0.075 per unit) on or prior to the date of the applicable deadline, for each three-month
extension. Our public shareholders will not be entitled to vote or redeem their shares in connection with any such extension. As
a result, we may conduct such an extension even though a majority of our public shareholders do not support such an extension and
will not be able to redeem their shares in connection therewith. This feature is different than the traditional special purpose
acquisition company structure, in which any extension of the company’s period to complete a business combination requires
a vote of the company’s shareholders and shareholders have the right to redeem their public shares in connection with such
vote.
Our
Sponsors may decide not to extend the term we have to consummate our initial business combination, in which case we would cease
all operations except for the purpose of winding up and we would redeem our public shares and liquidate, and the warrants will
be worthless.
We
will have until 12 months from the closing of the Initial Public Offering to consummate our initial business combination. However,
if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may, by resolution
of our board if requested by our Sponsors, extend the period of time to consummate a business combination up to two times, each
by an additional three months (for a total of up to 18 months to complete a business combination), subject to the Sponsors depositing
additional funds into the trust account. Our shareholders will not be entitled to vote or redeem their shares in connection with
any such extension. However, our shareholders will be entitled to vote and redeem their shares in connection with a shareholder
meeting held to approve an initial business combination or in a tender offer undertaken in connection with an initial business
combination if we propose such a business combination during any three-month extension period. In order for the time available
for us to consummate our initial business combination to be extended, our Sponsors or their affiliates or designees must deposit
into the trust account $1,035,000 ($0.075 per unit), and $2,070,000 or $0.15 per unit, on or prior to the date of the applicable
deadline, for each three month extension. Any such deposits will be in the form of non-interest bearing loans to us. If we complete
our initial business combination, we will, at the option of our Sponsors, repay such loaned amounts or redeem a portion or all
of the total loan amount into warrants at a price of $0.75 per warrant, which warrants will be identical to the private warrants.
If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account. Our Sponsors
and their affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial
business combination. If we are unable to consummate our initial business combination within the applicable time period, we will
liquidate as described herein. In such event, the warrants will be worthless.
If
we are unable to consummate our initial business combination within 12 months of the closing of the Initial Public Offering (or
up to 18 months if the time to consummate an initial business combination has been extended as described above), our public shareholders
may be forced to wait beyond such period of time before redemption from our trust account.
If
we are unable to consummate our initial business combination within 12 months from the closing of the Initial Public Offering (or
up to 18 months if the time to consummate an initial business combination has been extended as described above), we will, as promptly
as reasonably possible but not more than five business days thereafter, distribute the aggregate amount then on deposit in the
trust account (net of taxes payable, and less up to $50,000 of interest to pay liquidation expenses), pro rata to our public shareholders
by way of redemption and cease all operations except for the purposes of winding up of our affairs by way of a voluntary liquidation,
as further described herein. Any redemption of public shareholders from the trust account shall be effected as required by our
memorandum and articles of association prior to our commencing any voluntary liquidation. If we are required toliquidate
prior to distributing the aggregate amount then on deposit in the trust account (net of taxes payable, and less up to $50,000 of
interest to pay liquidation expenses) pro rata to our public shareholders, then such winding up, liquidation and distribution must
comply with the applicable provisions of the Companies Act. In that case, investors may be forced to wait beyond 12 months (or
up to 18 months if we extend the period of time to consummate an initial business combination as described above) before the redemption
proceeds of our trust account become available to them, and they receive the return of their pro rata portion of the proceeds from
our trust account. Except as otherwise described herein, we have no obligation to return funds to investors prior to the date of
any redemption required as a result of our failure to consummate our initial business combination within the period described above
or our liquidation, unless we consummate our initial business combination prior thereto and only then in cases where investors
have sought to redeem their ordinary shares. Only upon any such redemption of public shares as we are required to effect or any
liquidation will public shareholders be entitled to distributions if we are unable to complete our initial business combination.
Our
public shareholders may not be afforded an opportunity to vote on our proposed business combination, which means we may consummate
our initial business combination even though a majority of our public shareholders do not support such a combination.
If
we do not decide to hold a shareholder vote in conjunction with our initial business combination for business or other legal reasons,
we will conduct redemptions pursuant to the tender offer rules of the SEC and our memorandum and articles of association. Nasdaq
rules currently allow us to engage in a tender offer in lieu of a general meeting, provided that we were not seeking to issue more
than 20% of our issued and outstanding shares to a target business as consideration in any business combination. Furthermore, shareholder
approval would not be required pursuant to the Companies Act if our initial business combination were structured as a purchase
of assets, a purchase of stock, shares or other equity securities of the target not involving a merger with us, or a merger of
the target into a subsidiary of our company, or if we otherwise entered into contractual arrangements with a target to obtain control
of such company. Accordingly, we may consummate our initial business combination even if holders of a majority of our public shares
do not approve of the business combination.
Your
only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of
your right to redeem your shares from us for cash.
At
the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of one
or more target businesses. Because our board of directors may consummate our initial business combination without seeking shareholder
approval, public shareholders may not have the right or opportunity to vote on the business combination. Accordingly, your only
opportunity to affect the investment decision regarding a potential business combination may be limited to exercising your redemption
rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed to our
public shareholders in which we describe our initial business combination.
If
we seek shareholder approval of our business combination and we do not conduct redemptions pursuant to the tender offer rules,
and if you or a “group” of shareholders are deemed to hold in excess of 20% of our ordinary shares, you will lose the
ability to redeem all such shares in excess of 20% of our ordinary shares.
If
we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our business
combination pursuant to the tender offer rules, our memorandum and articles of association provides that a public shareholder,
individually or together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert
or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights
with respect to more than an aggregate of 20% of the shares sold in the Initial Public Offering. Your inability to redeem more
than an aggregate of 20% of the shares sold in the Initial Public Offering will reduce your influence over our ability to consummate
our initial business combination and you could suffer a material loss on your investment in us if you sell such excess shares in
open market transactions. As a result, you will continue to hold that number of shares exceeding 20% and, in order to dispose of
such shares, you would be required to sell your shares in open market transaction, potentially at a loss.
Our
initial shareholders control a substantial interest in us and thus may exert a substantial influence on actions requiring a shareholder
vote, potentially in a manner that you do not support.
Upon
closing of the Initial Public Offering and the private placement, our initial shareholders own 20% of our issued and outstanding
ordinary shares. Accordingly, they may exert a substantial influence on actions requiring a shareholder vote, potentially in a
manner that you do not support, including amendments to our memorandum and articles of association. If our initial shareholders
purchase any units in the Initial Public Offering or if they purchase any additional ordinary shares in the aftermarket or in privately
negotiated transactions, this would increase their control.
The
ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business
combination targets, which may make it difficult for us to enter into our initial business combination with a target.
We
may enter into a transaction agreement with a prospective target that requires as a closing condition that we have a minimum net
worth or a certain amount of cash. If too many public shareholders exercise their redemption rights, we may not be able to meet
such closing condition, and as a result, would not be able to proceed with such business combination. Furthermore, in no event
will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 immediately prior
to or upon the consummation of our initial business combination or any greater net tangible asset or cash requirement which may
be contained in the agreement relating to our initial business combination. Our memorandum and articles of association requires
us to provide all of our public shareholders with an opportunity to redeem all of their shares in connection with the consummation
of any initial business combination. Consequently, if accepting all properly submitted redemption requests would cause our net
tangible assets to be less than $5,000,001 immediately prior to or upon the consummation of our initial business combination, or
such greater amount necessary to satisfy a closing condition as described above, we would not proceed with such redemption and
the related business combination and may instead search for an alternate business combination. Prospective targets would be aware
of these risks and, thus, may be reluctant to enter into our initial business combination transaction with us.
The
ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us
to consummate the most desirable business combination or optimize our capital structure.
In
connection with the successful consummation of our initial business combination, we may redeem up to that number of ordinary shares
that would permit us to maintain net tangible assets of $5,000,001 immediately prior to or upon the consummation of our initial
business combination. If our initial business combination requires us to use substantially all of our cash to pay the purchase
price, the redemption threshold may be further limited. Alternatively, we may need to arrange third party financing to help fund
our business combination in case a larger percentage of shareholders exercise their redemption rights than we expect. If the acquisition
involves the issuance of our shares as consideration, we may be required to issue a higher percentage of our shares to the target
or its shareholders to make up for the failure to satisfy a minimum cash requirement. Raising additional funds to cover any shortfall
may involve dilutive equity financing or incurring indebtedness at higher than desirable levels. This may limit our ability to
effectuate the most attractive business combination available to us.
The
ability of our public shareholders to exercise their redemption rights may not allow us to effectuate the most desirable business
combination or optimize our capital structure.
If
our initial business combination requires us to use substantially all of our cash to pay the purchase price, because we will not
know how many public shareholders may exercise redemption rights, we may either need to reserve part of the trust account for possible
payment upon such redemption, or we may need to arrange third party financing to help fund our initial business combination. In
the event that the acquisition involves the issuance of our shares as consideration, we may be required to issue a higher percentage
of our shares to make up for a shortfall in funds. Raising additional funds to cover any shortfall may involve dilutive equity
financing or incurring indebtedness at higher than desirable levels. This may limit our ability to effectuate the most attractive
business combination available to us.
The
requirement that the target business or businesses that we acquire must collectively have a fair market value equal to at least
80% of the balance of the funds in the trust account (less any deferred underwriting commissions and taxes payable on interest
earned) at the time of the execution of a definitive agreement for our initial business combination may limit the type and number
of companies that we may complete such a business combination with.
Pursuant
to the Nasdaq listing rules, the target business or businesses that we acquire must collectively have a fair market value equal
to at least 80% of the balance of the funds in the trust account (less any deferred underwriting commissions and taxes payable
on interest earned) at the time of the execution of a definitive agreement for our initial business combination. This restriction
may limit the type and number of companies that we may complete an initial business combination with. If we are unable to locate
a target business or businesses that satisfy this fair market value test, we may be forced to liquidate and you will only be entitled
to receive your pro rata portion of the funds in the trust account.
We
may be unable to consummate an initial business combination if a target business requires that we have a certain amount of cash