Company Formation and Financial Overview - The company was formed as a blank check company on March 24, 2021, with no operations or identified business combination partner as of December 31, 2021[18]. - The company raised approximately 1.50 each, generating gross proceeds of approximately 221,950,000 for completing the initial business combination[184]. Target Markets and Growth Potential - The target markets include aerospace, space, microelectronics, cybersecurity, power & energy, and autonomy & mobility, with significant growth potential[31]. - The U.S. space economy is projected to grow from approximately 1.5 trillion by 2040, representing an annual growth rate of approximately 6%[31]. - Global cybersecurity spending is expected to exceed 10.00, based on the amount in the Trust Account[67]. - The company will not redeem public shares if it would cause net tangible assets to fall below $5,000,001 upon consummation of the initial business combination[69]. - A majority of the outstanding shares must be voted in favor of the business combination for it to be approved, requiring at least 8,625,001 public shares or 37.5% of the 23,000,000 public shares sold[75]. - The company has a restriction on public stockholders redeeming more than 15% of their public shares without prior consent, aimed at preventing stockholders from blocking business combinations[80]. Risks and Challenges - The company may not have the ability to diversify operations and may focus on a single industry, which could expose it to significant risks[52]. - There is no assurance that key personnel will remain in senior management positions post-business combination, and additional managers may need to be recruited[55]. - The company has identified a material weakness in internal control over financial reporting, which could adversely affect investor confidence and financial results[122]. - The company may face challenges in completing a business combination due to the impact of COVID-19 and market conditions[130]. Regulatory and Compliance Issues - The company is classified as an "emerging growth company," allowing it to take advantage of certain exemptions from reporting requirements, which may affect the attractiveness of its securities to investors[113]. - The company is also a "smaller reporting company," which allows for reduced disclosure obligations, potentially complicating comparisons with other public companies[116]. - Compliance with laws and regulations may be difficult and costly, potentially affecting the ability to negotiate and complete the initial business combination[169]. Competition and Market Conditions - Intense competition is expected from other blank check companies, private equity groups, and operating businesses, which may limit the company's ability to acquire larger target businesses[110]. - The company may face intense competition for business combination opportunities, which could hinder the completion of its initial business combination[151]. Financial and Operational Considerations - The company may need to seek stockholder approval for its initial business combination, which could influence the public float of Class A common stock[144][146]. - If the company fails to complete a business combination within the specified time frame, it will cease operations except for winding up and redeeming public shares[142][143]. - The company may face difficulties in maintaining or obtaining the quotation or listing of its securities on a national exchange due to reduced public float from potential share purchases[146][148]. Future Plans and Considerations - The company may continue to seek a different target for the initial business combination if the first proposed combination is not completed[88]. - The company plans to redeem public shares promptly after the 12-month period from the initial public offering, subject to stockholder approval and applicable law[103]. - The company may pursue acquisition opportunities outside of the FLAG team's area of expertise, potentially impacting the evaluation of significant risk factors[178].
Calidi Biotherapeutics(CLDI) - 2021 Q4 - Annual Report