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Alpha Partners Technology Merger (APTM) - 2022 Q4 - Annual Report
APTMAlpha Partners Technology Merger (APTM)2023-04-16 16:00

IPO and Fundraising - The company completed its IPO on July 30, 2021, raising gross proceeds of 250.0millionfromthesaleof25,000,000unitsat250.0 million from the sale of 25,000,000 units at 10.00 per unit, with offering costs of approximately 13.75million[15].−Anadditional3,250,000unitsweresoldthroughanover−allotmentoption,generatingapproximately13.75 million[15]. - An additional 3,250,000 units were sold through an over-allotment option, generating approximately 32.5 million in gross proceeds[15]. - The private placement of 800,000 units at 10.00perunitgeneratedgrossproceedsof10.00 per unit generated gross proceeds of 8.0 million, with an additional 65,000 units sold for 650,000[16].−Approximately650,000[16]. - Approximately 250.0 million of the net proceeds from the IPO and certain private placement proceeds were placed in a trust account, to be invested in U.S. government securities[17]. Business Combination Requirements - The company must complete one or more initial business combinations with an aggregate fair market value of at least 80% of the net assets held in the trust account[19]. - If a business combination is not completed within 24 months from the IPO, the company will redeem public shares at a cash price equal to the amount in the trust account[20]. - The company has not yet selected a prospective partner for a business combination and has not initiated substantive discussions with any candidates[23]. - The company may need additional financing to complete its initial business combination if the transaction requires more cash than available in the trust account[24]. Shareholder Rights and Redemption - A total of 8,975,001 public shares, or 35.9% of the 25,000,000 public shares sold in the public offering, must be voted in favor of the initial business combination for it to be approved[47]. - The company will not redeem public shares if the aggregate cash consideration required for redemptions exceeds the available cash, which could prevent the completion of the business combination[44]. - Shareholders are restricted from redeeming more than 15% of the shares sold in the public offering without prior consent, aimed at preventing a small group from blocking the business combination[50]. - Public shareholders must tender their shares or deliver them electronically to exercise redemption rights, with a deadline of two business days prior to the scheduled vote on the business combination[53]. Trust Account and Liquidation - The company will cease operations and liquidate if no business combination is consummated within the 24-month timeframe, redeeming public shares promptly thereafter[59]. - The per-share redemption amount upon dissolution is expected to be 10.00,butmaybesubjecttoclaimsfromcreditors,potentiallyreducingtheactualamountreceivedbyshareholders[63].−IftheTrustAccountfundsarereducedbelow10.00, but may be subject to claims from creditors, potentially reducing the actual amount received by shareholders[63]. - If the Trust Account funds are reduced below 10.00 per public share due to creditor claims, shareholders may not receive the full redemption amount[65]. - The company anticipates that all costs associated with the dissolution plan will be funded from remaining amounts outside the Trust Account, plus up to 100,000fromtheTrustAccount[62].FinancialConditionandRisks−AsofDecember31,2022,thecompanyhad100,000 from the Trust Account[62]. Financial Condition and Risks - As of December 31, 2022, the company had 726,869 in cash held outside of the Trust Account and a working capital deficit of 347,748,whichmaynotbesufficientforoperationsforatleastthenext12months[76].−ThecompanymustcompleteaBusinessCombinationbyJuly30,2023,orfacemandatoryliquidationanddissolution[77].−Thecompanymayfaceintensecompetitionfromotherentitieswithsimilarbusinessobjectives,whichmaylimititsabilitytoacquirelargerprospectivepartnerbusinesses[70].−TheongoingCOVID−19pandemicmayadverselyaffectthecompany′ssearchforabusinesscombinationandtheoperationsofpotentialpartnerbusinesses[89].RegulatoryandComplianceIssues−ThecompanymustensurethatitsactivitiesdonotclassifyitasaninvestmentcompanyundertheInvestmentCompanyAct,whichwouldimposeburdensomecompliancerequirements[109].−Changesinlawsorregulations,includingproposedSECrules,couldadverselyaffectthecompany′sabilitytocompleteitsinitialbusinesscombinationandincreaseassociatedcosts[114].−ThecompanyisnotrequiredtoholdanannualgeneralmeetinguntiloneyearafteritsfirstfiscalyearendfollowingitsNasdaqlisting,limitingshareholderengagement[116].ManagementandOperationalRisks−Thecompanycurrentlymaintainsexecutiveofficesatacostofupto347,748, which may not be sufficient for operations for at least the next 12 months[76]. - The company must complete a Business Combination by July 30, 2023, or face mandatory liquidation and dissolution[77]. - The company may face intense competition from other entities with similar business objectives, which may limit its ability to acquire larger prospective partner businesses[70]. - The ongoing COVID-19 pandemic may adversely affect the company's search for a business combination and the operations of potential partner businesses[89]. Regulatory and Compliance Issues - The company must ensure that its activities do not classify it as an investment company under the Investment Company Act, which would impose burdensome compliance requirements[109]. - Changes in laws or regulations, including proposed SEC rules, could adversely affect the company's ability to complete its initial business combination and increase associated costs[114]. - The company is not required to hold an annual general meeting until one year after its first fiscal year end following its Nasdaq listing, limiting shareholder engagement[116]. Management and Operational Risks - The company currently maintains executive offices at a cost of up to 55,000 per month for office space and administrative services[71]. - The company has two executive officers who are not obligated to devote specific hours but intend to allocate necessary time until the initial business combination is completed[72]. - The company may face challenges in obtaining additional financing for the initial business combination, which could lead to restructuring or abandonment of the deal[147]. Conflicts of Interest - The company may face conflicts of interest when engaging in business combinations with entities affiliated with its sponsor, executive officers, or directors[129]. - The company has not adopted a policy to prohibit conflicts of interest among its directors and officers, which may affect business combination opportunities[178]. - Directors and officers may have fiduciary obligations to other entities, potentially leading to conflicts in presenting business opportunities[179]. Share Structure and Dilution - The company may issue up to 200,000,000 Class A ordinary shares, 20,000,000 Class B ordinary shares, and 1,000,000 preference shares, with 170,885,000 Class A and 12,937,500 Class B shares authorized but unissued[193]. - The issuance of additional shares could significantly dilute the equity interest of investors, especially if Class B shares convert to Class A shares at a greater than one-to-one ratio[196]. - The potential issuance of additional Class A ordinary shares upon warrant exercise could make the company a less attractive acquisition vehicle for prospective partners[208]. Warrant and Redemption Terms - The company issued warrants to purchase 9,416,666 Class A ordinary shares as part of the IPO, with an additional 288,334 Class A shares underlying private placement units[207]. - The company may redeem outstanding public warrants at 0.01perwarrantiftheClassAordinaryshares′closingpriceexceeds0.01 per warrant if the Class A ordinary shares' closing price exceeds 18.00 for 20 trading days within a 30-day period[203]. - The company’s warrants are classified as liabilities and recorded at fair value, which may adversely affect the market price of Class A ordinary shares[198].