CLIMATEROCK Cautionary Note Regarding Forward-Looking Statements
All statements other than statements of historical fact included in this Report
including, without limitation, statements in this section regarding our
financial position, business strategy and the plans and objectives of management
for future operations, are forward-looking statements. When used in this Report,
words such as "anticipate," "believe," "estimate," "expect," "intend" and
similar expressions, as they relate to us or our management, identify
forward-looking statements. Such forward-looking statements are based on the
beliefs of our management, as well as assumptions made by, and information
currently available to, our management. Actual results could differ materially
from those contemplated by the forward-looking statements as a result of certain
factors detailed in our filings with the
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Report.
Overview
The Company is a
Although the Company is not limited to a particular industry or geographic region for purposes of consummating an initial business combination, the Company focuses on opportunities in environmental protection, renewable energy, fighting climate change, and any other related industries. We will target companies with established operating models that have strong management teams, realigned capital structures, positive cash flows prospects, and a clear and well-defined pathway for growing profitably over the long-term. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.
As of
The IPO Registration Statement was declared effective on
The Company commenced operations after obtaining adequate financial resources
through (i) the initial public offering of 7,875,000 units at
The units were listed on Nasdaq. The Company's management has broad discretion with respect to the specific application of the net proceeds of the initial public offering and sale of the private placement warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating an initial business combination. Nasdaq rules provide that the initial business combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the net assets held in the trust account (as defined below) (net of amounts disbursed to management for working capital purposes). The Company will only complete an initial business combination if the post-business combination 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. There is no assurance that the Company will be able to successfully effect an initial business combination.
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Upon the closing of the initial public offering,
Our initial Shareholders have agreed (a) to vote their founder shares and any public shares purchased during or after the initial public offering in favor of an initial business combination, (b) not to propose an amendment to the Company's amended and restated memorandum and articles of association with respect to the Company's pre-business combination activities prior to the consummation of an initial business combination unless the Company provides dissenting public shareholders with the opportunity to redeem their public shares in conjunction with any such amendment; (c) not to redeem any shares (including the founder shares) into the right to receive cash from the trust account in connection with a shareholder vote to approve an initial business combination (or to sell any shares in a tender offer in connection with an initial business combination if the Company does not seek shareholder approval in connection therewith) or a vote to amend the provisions of the amended and restated certificate of incorporation relating to shareholders' rights of pre-business combination activity and (d) that the founder shares and the private placement warrants (including underlying securities) shall not participate in any liquidating distributions upon winding up if an initial business combination is not consummated. However, the initial shareholders will be entitled to liquidating distributions from the trust account with respect to any public shares purchased during or after the initial public offering if the Company fails to complete its initial business combination.
Recent Developments
On
The total consideration to be offered by
For a more detailed description of the EEW Business Combination Agreement and the transactions contemplated therein, see "Item 1. Business".
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Results of Operations
Our entire activity since inception up to
For the year ended
For the year ended
Liquidity and Capital Reserves
On
In order to finance transaction costs in connection with an initial business combination, our Sponsor or an affiliate of our Sponsor, or certain of our officers and directors may, but are not obligated to, loan us working capital loans.
On
Additionally, on
On
We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an initial business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon completion of our initial business combination, in which case we may issue additional securities or incur debt in connection with such business combination.
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Off-Balance Sheet Arrangements
We have no obligations, assets or liabilities, which would be considered
off-balance sheet arrangements as of
Contractual Obligations Registration Rights
Pursuant to a registration rights agreement entered into on
Underwriting Agreement
Pursuant to the underwriting agreement, the underwriters received a cash
underwriting discount of
Additionally, the Company granted the underwriters for a period beginning on the
closing of the initial public offering and ending on the earlier of the 12 month
anniversary of the closing of an initial business combination or
Transaction Expenses
On
On
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Under the ALANTRA Letter Agreement, we agreed to pay ALANTRA a retainer of
If a transaction that is introduced by ALANTRA or by another institution to which no fees are due by the Company (e.g. an institution acting on behalf of a target) is completed the following remuneration will be due to ALANTRA as a remuneration for its services ("ALANTRA Success Fee"):
?$1,600,000 payable by the Company; and ?$1,600,000 payable by or on behalf of the Sponsor Entity.
If a transaction is completed in
? For the first $300,000,000 of aggregated value of the transaction, 0.85%
of each transaction purchase price; and
? For the aggregated value of the transaction above the first $300,000,000 ,
0.4% of each transaction purchase price.
Notwithstanding the above, it is agreed that the ALANTRA Success Fee will be
subject to a minimum of
Each ALANTRA Success Fee shall be payable upon consummation of the applicable transaction (i.e. when the transaction is closed, following fulfillment, if applicable, of conditions precedent) regardless of (i) the calendar for the payment of the price, (ii) how the purchase price is funded, (iii) and any deferred payment subsequent to consummation of the transaction, or (iv) any adjustment to the price of the transaction subsequent to consummation.
Related Party Transactions Founder Shares
During the period ended
On
The initial shareholders have agreed not to transfer, assign or sell any of the founder shares (except to certain permitted transferees) until the earlier of (i) six months after the date of the consummation of the Company's initial business combination or (ii) the date on which we consummate a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property. Any permitted transferees will be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares.
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Loan with Related Party The Company agreed to borrow up to
On
Additionally, on
On
Eternal is controlled by
Administrative Service Fee
The Company entered into the Administrative Services Agreement on
Advisory Services
On
On
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In addition, the Gluon Letter Agreement was amended to entitle
In addition to the Gluon Success Fee, the Company agreed to pay
Per Regnarsson, the Chief Executive Officer and a director of the Company, is
the Managing Partner of
Critical Accounting Policies
The preparation of financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We had identified the following as its critical accounting policies:
Deferred offering costs
The Company complies with the requirements of the FASB ASC 340-10-S99-1 and
Net income (loss) per share
The Company complies with accounting and disclosure requirements of ASC Topic
260, "Earnings Per Share." In order to determine the net income (loss)
attributable to both the redeemable shares and non-redeemable shares, the
Company first considered the undistributed income (loss) allocable to both the
redeemable shares and non-redeemable shares and the undistributed income (loss)
is calculated using the total net loss less interest income in trust account
less any dividends paid. We then allocated the undistributed income (loss)
ratably based on the weighted average number of shares outstanding between the
redeemable and non-redeemable shares. Any remeasurement of the accretion to
redemption value of the ordinary shares subject to possible redemption was
considered to be dividends paid to the public shareholders. At
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Ordinary shares subject to possible redemption
The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in FASB ASC Topic 480 "Distinguishing Liabilities from Equity." Ordinary shares subject to mandatory redemption (if any) are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company's control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders' equity. The Company's public shares feature certain redemption rights that are considered to be outside of the Company's control and subject to occurrence of uncertain future events. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable ordinary shares are affected by charges against additional paid in capital or accumulated deficit if additional paid in capital equals to zero. Accordingly, ordinary shares subject to possible redemption are presented at redemption value (plus any interest earned and/or dividends on the trust account) as temporary equity, outside of the shareholders' equity section of the Company's balance sheets.
Recent accounting pronouncements
Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company's financial statements.
Factors that may adversely affect our results of operations
Our results of operations and our ability to complete an initial business
combination may be adversely affected by various factors that could cause
economic uncertainty and volatility in the financial markets, many of which are
beyond our control. Our business could be impacted by, among other things,
downturns in the financial markets or in economic conditions, increases in oil
prices, inflation, increases in interest rates, supply chain disruptions,
declines in consumer confidence and spending, the ongoing effects of the
COVID-19 pandemic, including resurgences and the emergence of new variants, and
geopolitical instability, such as the military conflict in the
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Report (as defined below), including, without limitation, statements under "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations," includes forward-looking statements within the meaning of Section 27A of the Securities Act (as defined below) and Section 21E of the Exchange Act (as defined below). These forward-looking statements can be identified by the use of forward-looking terminology, including the words "believes," "estimates," "anticipates," "expects," "intends," "plans," "may," "will," "potential," "projects," "predicts," "continue," or "should," or, in each case, their negative or other variations or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. Such statements include, but are not limited to, any statements relating to our ability to consummate any acquisition or other business combination and any other statements that are not statements of current or historical facts. These statements are based on management's current expectations, but actual results may differ materially due to various factors, including, but not limited to:
? our ability to complete our initial business combination (as defined below),
including the EEW Business Combination (as defined below);
? our success in retaining or recruiting, or changes required in, our officers,
key employees or directors following our initial business combination;
? our officers and directors allocating their time to other businesses and
potentially having conflicts of interest with our business or in approving our
initial business combination, as a result of which they would then receive
expense reimbursements;
? our potential ability to obtain additional financing to complete our initial
business combination;
? the ability of our officers and directors to generate a number of potential
acquisition opportunities;
? our pool of prospective target businesses;
? the ability of our officers and directors to generate a number of potential
acquisition opportunities;
? our public securities' potential liquidity and trading;
? the lack of a market for our securities;
? the use of proceeds not held in the trust account (as defined below) or
available to us from interest income on the trust account balance; or
? our financial performance.
The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting us may not 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. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
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Unless otherwise stated in this Report, or the context otherwise requires, references to:
? "Administrative Services Agreement" are to the administrative services
agreement entered into on
sponsor (as defined below) under which our sponsor agreed to perform certain
services for the Company for a monthly fee of
? "ASC" are to the FASB (as defined below) Accounting Standards Codification;
? "board of directors," "board" or "directors" are to the board of directors of
the Company (as defined below);
? "business combination" are to a merger, share exchange, asset acquisition,
share purchase, reorganization or similar business combination with one or more
businesses;
? "Class A ordinary shares" are to the Class A ordinary shares of the Company,
par value
? "Class B ordinary shares" are to the Class B ordinary shares of the Company,
par value
? "Combination Period" are to the 12-month period from the closing of our initial
public offering (as defined below), or from
to 18 months from the closing of the initial public offering if extended), that
the Company has to consummate an initial business combination;
? "Companies Law" are to the Companies Law (2020 Revision) of the
as the same may be amended from time to time;
? "Company," "our Company," "we" or "us" are to
exempted company;
? "Company Share Transfer" are to the offer of
acquire each issued and outstanding EEW (as defined below) ordinary share in
consideration for the issue and allotment of substantially equivalent
securities in
defined below) and subject to the terms and conditions set forth therein;
? "Continental" are to
trust account and warrant agent of our public warrants (as defined below);
? "DWAC System" are to the
Custodian System;
? "EEW" are to
? "EEW Business Combination" are to the proposed business combination with EEW;
? "EEW Business Combination Agreement" are to the business combination
agreement, dated as of
Merger Sub (as defined below) and EEW.
? "EEW Closing" are to the closing of the transactions contemplated by the EEW
Business Combination Agreement;
? "EEW Registration Statement" are to the registration statement on Form S-4 to
be prepared by the Company and
with the EEW Business Combination;
? "EEW Transactions" are to the Merger (as defined below) together with the
Company Share Transfer;
? "Effective Time" are to the effective time of the Merger;
? "ESG" are to Environmental, Social and Corporate Governance;
? "Eternal" are to
? "Exchange Act" are to the Securities Exchange Act of 1934, as amended;
? "FASB" are to the
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? "FINRA" are to the
? "First Eternal Loan" are to the non-interest bearing, unsecured loan by
Eternal to the Company that was fully repaid on
? "Fourth Eternal Loan" are to the loan agreement entered into on
2023 with Eternal in the principal amount of up to
basis and bearing no interest;
? "founder shares" are to the Class B ordinary shares initially purchased by our
sponsor in the private placement (as defined below) and the Class A ordinary
shares that will be issued upon the automatic conversion of the Class B
ordinary shares at the time of our initial business combination as described
herein (for the avoidance of doubt, such Class A ordinary shares will not be
"public shares" (as defined below));
? "GAAP" are to the accounting principles generally accepted in the United
States of America;
? "
? "Gluon Letter Agreement" are to the letter agreement entered into on September
21, 2022, as amended on
Partners (as defined below), pursuant to which the Company will pay Gluon
Partners a fee upon completion of one or more successful transactions;
? "
? "Gluon Success Fee" are to the fee to be paid by the Company to
pursuant to the Gluon Letter Agreement;
? "Holder Support Agreement' are to the holder support agreement entered into on
vote in favor of the adoption of the EEW Business Combination and the EEW
Transactions;
? "IFRS" are to the International Financial Reporting Standards, as issued by the
? "initial public offering" or "IPO" are to the initial public offering that was
consummated by the Company on
? "initial shareholders" are to holders of our founder shares prior to our
initial public offering;
? "Investment Company Act" are to the Investment Company Act of 1940, as
amended;
? "IPO Registration Statement" are to the Registration Statement on Form S-1
initially filed with the
and declared effective on
? "JOBS Act" are to the Jumpstart Our Business Startups Act of 2012;
? "management" or our "management team" are to our executive officers and
directors;
? "Maxim" are to
initial public offering;
? "Merger" are to the merger of Merger Sub with and into the Company, with the
Company continuing as the surviving entity, pursuant to the EEW Business
Combination Agreement and subject to the terms and conditions set forth
therein;
? "Merger Sub" are to
company and a wholly-owned subsidiary of
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? "Nasdaq" are to the Nasdaq Global Market;
? "New Registration Rights Agreement" are to the registration rights agreement
to be entered into at the EEW Closing by and among the
and our sponsor;
? "
countries;
? "ordinary shares" are to the Class A ordinary shares and the Class B ordinary
shares;
? "PCAOB" are to the
? "private placement" are to the private placement of warrants that occurred
simultaneously with the closing of our initial public offering;
? "private placement warrants" are to the warrants issued to our sponsor in the
private placement;
? "Promissory Note" are to the promissory note under which our sponsor agreed to
loan the Company up to
the initial public offering;
? "Pubco" are to
company;
? "Pubco Ordinary Shares" are to the ordinary shares of
per share;
? "public shares" are to the Class A ordinary shares sold as part of the units in
our initial public offering (whether they were purchased in our initial public
offering or thereafter in the open market);
? "public shareholders" are to the holders of our public shares, including our
initial shareholders and management team to the extent our initial shareholders
and/or members of our management team purchase public shares, provided that
each initial shareholder's and member of our management team's status as a
"public shareholder" will only exist with respect to such public shares;
? "public warrants" refer to the redeemable warrants sold as part of the units in
our initial public offering (whether they were subscribed for in our initial
public offering or purchased in the open market);
? "Report" are to this Annual Report on Form 10-K for the fiscal year ended
December 31, 2022 ;
? "representative shares" are to the Class A ordinary shares issued to Maxim
and/or its designees upon the consummation of our initial public offering;
? "rights" or "public rights" are to the rights sold as part of the units in our
initial public offering, each entitling the holder to receive one-tenth (1/10)
of one Class A ordinary share upon the consummation of an initial business
combination;
? "Sarbanes-Oxley Act" are to the Sarbanes-Oxley Act of 2002;
? "SEC" are to the
? "Second Eternal Loan" are to the loan agreement entered into on
2022 with Eternal in the principal amount of up to
basis and bearing no interest;
? "Securities Act" are to the Securities Act of 1933, as amended;
? "Sellers" are to the holders of EEW securities to be offered considerations by
? "SPACs" are to special purpose acquisition companies;
? "sponsor" are to
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? "Third Eternal Loan" are to the loan agreement entered into on
2022 with Eternal in the principal amount of up to
basis and bearing no interest;
? "trust account" are to the
public offering and the private placement warrants was placed following the
closing of the initial public offering;
? "UHY" are to
? "units" are to the units sold in our initial public offering, which consist of
one Class A Ordinary Share, one-half of one public warrant and one right; and
? "working capital loans" are to funds that, in order to provide working capital
or finance transaction costs in connection with a business combination, the
initial shareholders or an affiliate of the initial shareholders or certain of
the Company's directors and officers may, but are not obligated to, loan the
Company.
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