ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification Number) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
one-third of one redeemable warrant |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
☒ | Smaller reporting company | |||||
Emerging growth company |
Auditor Firm Id: PCAOB ID |
Auditor Name: |
Auditor Location: |
• | our ability to select an appropriate target business or businesses; |
• | our ability to complete our initial business combination; |
• | our expectations around the performance of a prospective target business or businesses; |
• | 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; |
• | our potential ability to obtain additional financing to complete our initial business combination; |
• | our pool of prospective target businesses; |
• | our ability to consummate an initial business combination due to the uncertainty resulting from the COVID-19 pandemic; |
• | the ability of our officers and directors to generate a number of potential business combination 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 described herein) or available to us from interest income on the Trust Account balance; |
• | the Trust Account not being subject to claims of third parties; or |
• | our financial performance. |
• | subject us to negative economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact on the particular industry in which we operate after our initial business combination; and |
• | cause us to depend on the marketing and sale of a single product or limited number of products or services. |
• | We issue Class A ordinary shares that will be equal to or in excess of 20% of the number of our Class A ordinary shares then outstanding (other than in a public offering); |
• | Any of our directors, officers or substantial shareholders (as defined by Nasdaq rules) has a 5% or greater interest earned on the trust account (or such persons collectively have a 10% or greater interest), directly or indirectly, in the target business or assets to be acquired or otherwise and the present or potential issuance of ordinary shares could result in an increase in outstanding ordinary shares or voting power of 5% or more; or |
• | The issuance or potential issuance of ordinary shares will result in our undergoing a change of control. |
• | conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and |
• | file proxy materials with the SEC. |
• | conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and |
• | file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. |
• | default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations; |
• | acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
• | our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand; |
• | our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding; |
• | our inability to pay dividends on our Class A ordinary shares; |
• | using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our Class A ordinary shares if declared, expenses, capital expenditures, acquisitions and other general corporate purposes; |
• | limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
• | increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and |
• | limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. |
• | solely dependent upon the performance of a single business, property or asset, or |
• | dependent upon the development or market acceptance of a single or limited number of products, processes or services. |
• | a limited availability of market quotations for our securities; |
• | reduced liquidity for our securities; |
• | a determination that our Class A ordinary shares are a “penny stock” which will require brokers trading in our Class A ordinary shares to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; |
• | a limited amount of news and analyst coverage; and |
• | a decreased ability to issue additional securities or obtain additional financing in the future. |
• | restrictions on the nature of our investments; and |
• | restrictions on the issuance of securities, |
• | each of which may make it difficult for us to complete our initial business combination. In addition, we may have imposed upon us burdensome requirements, including: |
• | registration as an investment company with the SEC; |
• | adoption of a specific form of corporate structure; and |
• | reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are not subject to. |
• | may significantly dilute the equity interest of investors in the Initial Public Offering; |
• | may subordinate the rights of holders of Class A ordinary shares if preferred shares are issued with rights senior to those afforded our Class A ordinary shares; |
• | could cause a change in control if a substantial number of Class A ordinary shares are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; and |
• | may adversely affect prevailing market prices for our units, Class A ordinary shares and/or warrants. |
• | we have a board that includes a majority of “independent directors,” as defined under the rules of Nasdaq; |
• | we have a compensation committee of our board that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and |
• | to the extent that we have one, we expect our nominating and corporate governance committee to be comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities |
• | costs and difficulties inherent in managing cross-border business operations, including differences between U.S. GAAP and the International Accounting Standards; |
• | rules and regulations regarding currency redemption; |
• | complex corporate withholding taxes on individuals; |
• | laws governing the manner in which future business combinations may be effected; |
• | exchange listing and/or delisting requirements; |
• | tariffs and trade barriers; |
• | regulations related to customs and import/export matters; |
• | local or regional economic policies and market conditions; |
• | unexpected changes in regulatory requirements; |
• | challenges in managing and staffing international operations; |
• | longer payment cycles; |
• | tax issues, such as tax law changes and variations in tax laws as compared to the United States; |
• | currency fluctuations and exchange controls; |
• | rates of inflation; |
• | challenges in collecting accounts receivable; |
• | cultural and language differences; |
• | employment regulations; |
• | underdeveloped or unpredictable legal or regulatory systems; |
• | corruption; |
• | protection of intellectual property; |
• | social unrest, crime, strikes, riots and civil disturbances; |
• | regime changes and political upheaval; |
• | terrorist attacks and wars; and |
• | deterioration of political relations with the United States. |
Name |
Age |
Position | ||
Abidali Neemuchwala | 53 | Chief Executive Officer and Chairman | ||
Burhan Jaffer | 41 | Chief Financial Officer | ||
Satish Gupta | 61 | Director | ||
Steven Freiberg | 64 | Director | ||
Deborah C. Hopkins | 67 | Director | ||
Bill Owens | 80 | Director | ||
Jon Zieger | 48 | Director |
• | assisting board oversight of (1) the integrity of our financial statements, (2) our compliance with legal and regulatory requirements, (3) our independent registered public accounting firm’s qualifications and independence, and (4) the performance of our internal audit function and independent registered public accounting firm; |
• | the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm and any other independent registered public accounting firm engaged by us; |
• | pre-approving all audit and non-audit services to be provided by the independent registered public accounting firm or any other registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; reviewing and discussing with the independent registered public accounting firm all relationships the registered public accounting firm has with us in order to evaluate their continued independence; |
• | setting clear policies for audit partner rotation in compliance with applicable laws and regulations; obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (1) the independent registered public accounting firm’s internal quality-control procedures and (2) any material issues raised by the most recent internal quality-control review, or peer review, of the independent registered public accounting firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues; |
• | meeting to review and discuss our annual audited financial statements and quarterly financial statements with management and the independent registered public accounting firm, including reviewing our specific disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and |
• | reviewing with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities. |
• | reviewing and approving on an annual basis the corporate goals and objectives relevant to our chief executive officer’s compensation, evaluating our chief executive officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our chief executive officer’s based on such evaluation; |
• | reviewing and making recommendations to our board of directors with respect to the compensation, and any incentive compensation and equity based plans that are subject to board approval of all of our other officers; |
• | reviewing our executive compensation policies and plans; |
• | implementing and administering our incentive compensation equity-based remuneration plans; |
• | assisting management in complying with our proxy statement and annual report disclosure requirements; |
• | approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees; |
• | producing a report on executive compensation to be included in our annual proxy statement; and |
• | reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors. |
• | identifying, screening and reviewing individuals qualified to serve as directors, consistent with criteria approved by the board, and recommending to the board of directors candidates for nomination for appointment at the annual general meeting or to fill vacancies on the board of directors; |
• | developing and recommending to the board of directors and overseeing implementation of our corporate governance guidelines; |
• | coordinating and overseeing the annual self-evaluation of the board of directors, its committees, individual directors and management in the governance of the company; and |
• | reviewing on a regular basis our overall corporate governance and recommending improvements as and when necessary. |
• | duty to act in good faith in what the director or officer believes to be in the best interests of the company as a whole; |
• | duty to exercise powers for the purposes for which those powers were conferred and not for a collateral purpose; |
• | directors should not improperly fetter the exercise of future discretion; |
• | duty to exercise powers fairly as between different sections of shareholders; |
• | duty not to put themselves in a position in which there is a conflict between their duty to the company and their personal interests; and |
• | duty to exercise independent judgment. |
Individual |
Entity/Organization |
Entity’s Business |
Affiliation | |||
Abidali Neemuchwala | SoftWorks AI | Information Technology | Board Member | |||
World Affairs Council of DFW | Non-Profit |
Board Member | ||||
Dallas Venture Capital | Venture Fund | Co-Founder and Director | ||||
Burhan Jaffer | Social Impact Capital | Venture Fund | Venture Partner | |||
Mission Society | Non-Profit |
Board Member | ||||
Bottom Line |
Non-Profit |
Regional Advisory Council | ||||
MIT Solve |
Start-up Incubator / Foundry |
Member | ||||
Satish Gupta | SB International | Supplier and Manufacturer for Oil and Gas Industry | CEO | |||
Gupta Capital Group | Single Family Office | President and Chairman | ||||
Commercial Steel Products, LLC | Supplier and Distributor of Steel Products | Chairman |
Individual |
Entity/Organization |
Entity’s Business |
Affiliation | |||
SB Speciality Metals, LLC |
Supplier and Distributor of Steel Products |
Chairman | ||||
Steven Freiberg |
SoFi |
Financial Services |
Board Vice Chairman | |||
Rewards Network |
Marketing |
Board Chairman | ||||
MasterCard |
Financial Services |
Board Member | ||||
Purchasing Power |
Financial Services |
Board Member | ||||
Regional Management Corporation |
Financial Services |
Board Member | ||||
Portage Financial Technology Acquisition Corp |
Financial Services |
Chairman | ||||
BCG |
Consulting |
Senior Advisor | ||||
Towerbrook Capital Partners |
Financial Services |
Senior Advisor | ||||
Verisk Analytics |
Data Analytics |
Senior Advisor | ||||
Deborah C. Hopkins |
Union Pacific |
Transportation |
Board Member | |||
Marsh McLennan |
Consulting |
Board Member | ||||
Deep Instinct |
Cybersecurity |
Board Member | ||||
Bridge Investment Group Holdings |
Investment Fund |
Board Member | ||||
St. John’s Health |
Healthcare |
Trustee & Vice-Chair | ||||
Admiral Bill Owens |
Red Bison |
Smart Building Technology |
Executive Chairman | |||
Wipro Technologies |
Information Technology Services |
Board of Directors | ||||
Tethr |
Information Technology |
Board Member | ||||
TruU |
Information Technology |
Board Member | ||||
Versium |
Information Technology |
Board Member | ||||
Know Labs |
Medical Diagnostics |
Board Member | ||||
Kyrrex |
Cryptocurrency |
Board Member | ||||
Seattle University |
University |
Board of Trustees | ||||
Fiscal Responsibility Amendment (CFFRA) |
Board of Trustees | |||||
Jon Zieger |
Responsible Innovation Labs, Inc. |
Non-Profit |
Executive Director & Board of Directors |
• | Our officers and directors are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time between our operations and our search for a business combination and their other businesses. We do not intend to have any full-time employees prior to the completion of our initial business combination. Each of our officers and directors is engaged in several other business endeavors for which he may be entitled to substantial compensation, and our officers are not obligated to contribute any specific number of hours per week to our affairs. |
• | Our initial shareholders purchased founder shares prior to the date of the final prospectus and purchased private placement warrants in a transaction that closed concurrently with the closing of the IPO. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and any public shares held by them in connection with the completion of our initial business combination. Additionally, our sponsor, officers and directors have agreed to waive their rights to liquidating distributions from the trust account |
with respect to their founder shares if we fail to complete our initial business combination within the prescribed time frame. If we do not complete our initial business combination within the prescribed time frame, the private placement warrants will expire worthless. Furthermore, our sponsor, officers and directors have agreed not to transfer, assign or sell any of their founder shares and any Class A ordinary shares issuable upon conversion thereof until the earlier to occur of: (i) one year after the completion of our initial business combination or (ii) the date following the completion of our initial business combination on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property. Notwithstanding the foregoing, if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, the founder shares will be released from the lock-up. |
• | Our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. |
• | each person known by us to be a beneficial owner of more than 5% of our issued and ordinary shares; |
• | each of our executive officers and directors that beneficially owns ordinary shares; |
• | all our executive officers and directors as a group. |
Number of Shares Beneficially Owned |
Approximate Percentage of Outstanding Ordinary Shares |
|||||||
5% Shareholders: |
||||||||
Entities affiliated with Citadel Advisors LLC (1) |
1,499,999 | 5.65 | % | |||||
Entities affiliated with Basso SPAC Fund LLC (2) |
1,648,935 | 6.21 | % | |||||
Entities affiliated with Magnetar Financial LLC (3) |
1,975,900 | 7.44 | % | |||||
Entities affiliated with Radcliffe Capital Management, L.P. (4) |
1,977,200 | 7.45 | % | |||||
Entities affiliated with Sculptor Capital LP (5) |
1,980,000 | 7.46 | % | |||||
Directors and Officers: |
||||||||
Compass Digital SPAC LLC (6)(8) |
5,310,122 | (7) |
20 | % | ||||
Abidali Neemuchwala (8) |
5,310,122 | (7) |
20 | % | ||||
Burhan Jaffer |
— | — | % | |||||
Satish Gupta (8) |
5,310,122 | (7) |
20 | % | ||||
Steven Freiberg (8) |
— | — | % | |||||
Deborah C. Hopkins |
— | — | % | |||||
Bill Owens |
— | — | % | |||||
Jon Zieger |
— | — | % | |||||
All officers and directors as a group (7 individuals) (9) |
5,310,122 | (7) | 20 | % |
* | Less than one percent. |
(1) | The information in the table above is based solely on information contained in this shareholder’s Schedule 13G under the Exchange Act filed by such shareholder with the SEC. Includes (i) each of Citadel Advisors LLC, Citadel Advisors Holdings LP and Citadel GP LLC beneficial ownership of 1,499,999 Class A ordinary shares, (ii) each of Citadel Securities LLC, Citadel Securities Group LP, and Citadel Securities Group GP LLC beneficial ownership of 233 Class A ordinary shares, and (iii) Mr. Kenneth Griffin’s beneficial ownership own 1,500,232 Class A ordinary shares. The address of the principal business office of each is 131 S. Dearborn Street, 32nd Floor, Chicago, Illinois 60603. |
(2) | The information in the table above is based solely on information contained in this shareholder’s Schedule 13G under the Exchange Act filed by such shareholder with the SEC. Includes (i) 525,000 Class A ordinary shares, (ii) 150,000 Class B ordinary shares, and (iii) 973,935 Class A ordinary shares underlying units beneficially owned by the following persons: Basso SPAC Fund LLC, Basso Management, LLC, Basso Capital management, L.P., Basso GP, LLC, and Howard I. Fischer (“Basso”). This amount excludes the rights to receive Shares (“Rights”) and warrants to purchase Shares (“Warrants”), if any, underlying any Units and/or held directly by Basso, because Basso does not have the right to acquire the Shares underlying the Rights or Warrants within 60 days. The address of the principal business office of Basso is 1266 East Main Street, Fourth Floor, Stamford, Connecticut 06902. |
(3) | The information in the table above is based solely on information contained in this shareholder’s Schedule 13G under the Exchange Act filed by such shareholder with the SEC. Each of Magnetar Financial LLC (“Magnetar Financial”), Magnetar Capital Partners LP (Magnetar Capital Partners”), Supernova Management LLC (“Supernova Management”) and Mr. Alec N. Litowitz held 1,975,900 Shares. The amount consists of (i) 202,629 Class A ordinary shares (“Shares”) held for the account of Magnetar Constellation Fund II, Ltd; (ii) 630,402 Shares held for the account of Magnetar Constellation Master Fund, Ltd; (iii) 53,100 Shares held for the account of Magnetar Systematic Multi-Strategy Master Fund Ltd; (iv) 34,000 Shares held for the account of Magnetar Capital Master Fund Ltd; (v) 12,600 Shares held for the account of Magnetar Discovery Master Fund Ltd; (vi) 247,659 Shares held for the account of Magnetar Xing He Master Fund Ltd; (vii) 118,200 Shares held for the account of Purpose Alternative Credit Fund Ltd; (viii) 163,230 Shares held for the account of Magnetar SC Fund Ltd; (ix) 234,525 Shares held for the account of Magnetar Structured Credit Fund, LP; (x) 238,278 Shares held for the account of Magnetar Lake Credit Fund LLC; and (xi) 41,277 Shares held of the account of Purpose Alternative Credit Fund - T LLC. The address of the principal business office of each of Magnetar Financial, Magnetar Capital Partners, Supernova Management, and Mr. Litowitz is 1603 Orrington Avenue, 13th Floor, Evanston, Illinois 60201. |
(4) | The information in the table above is based solely on information contained in this shareholder’s Schedule 13G under the Exchange Act filed by such shareholder with the SEC. Includes 1,977,200 Class A ordinary shares owned by Radcliffe Capital Management, L.P., RGC Management Company, LLC., Steven B. Katznelson, Christopher Hinkel, Radcliffe SPAC Master Fun, L.P. and Radcliffe SPAC GP, LLC. Radcliffe Capital Management, L.P. is the relevant entity for which RGC Management Company, LLC, Steven B. Katznelson and Christopher Hinkel may be considered control persons. Radcliffe SPAC Master Fund, L.P. is the relevant entity for which Radcliffe SPAC GP, LLC, Steven B. Katznelson and Christopher Hinkel may be considered control persons. The address of Radcliffe Capital Management, L.P. is 50 Monument Road, Suite 300, Bala Cynwyd, PA 19004. |
(5) | The information in the table above is based solely on information contained in this shareholder’s Schedule 13G under the Exchange Act filed by such shareholder with the SEC on October 15, 2021. Includes (i) 1,980,000 Class A ordinary shares (“Shares”) beneficially owned by each of Sculptor Capital LP (“Sculptor”). Sculptor Capital II LP (“Sculptor-II”), Sculptor Capital Holding Corporation (“SCHC”), Sculptor Capital Holding II LLC (“SCHC-II”) and Sculptor Capital Management, Inc. (“SCU”), (ii) 643,500 Shares beneficially owned by each of Sculptor Master Fund, Ltd. (“SCMF”) and Sculptor Special Funding, LP (“NRMD”), (iii) 198,000 Shares beneficially owned by each of Sculptor Credit Opportunities Master Fund, Ltd. (“SCCO”) and Sculptor Enhanced Master Fund, Ltd. (“SCEN”), and (iv) 940,500 Shares beneficially owned by Sculptor SC II LP (“NJGC”). Sculptor and Sculptor-II serve as the principal investment managers to the private funds and discretionary accounts managed by Sculptor and thus may be deemed beneficial owners of the Shares in the private funds and discretionary accounts managed by Sculptor and Sculptor-II. SCHC-II serves as the sole general partner of Sculptor-II and is wholly owned by Sculptor. SCHC serves as the sole general partner of Sculptor. As such, SCHC and SCHC-II may be deemed to control Sculptor as well as Sculptor-II and, therefore, may be deemed to be the beneficial owners of the Shares. SCU is the sole shareholder of SCHC, and may be deemed a beneficial owner of the Shares reported herein. The address of the principal business offices of Sculptor, Sculptor-II, SCHC, SCHC-II, SCU, SCMF, NRMD, SCEN, SCCO and NJGC is 9 West 57 Street, 39 Floor, New York, NY 10019. |
(6) | Unless otherwise noted, the business address of each of the shareholders is 3626 N Hall St, Suite 910, Dallas, Texas 75219. |
(7) | Interests shown consist solely of founder shares, classified as Class B ordinary shares. Such shares will automatically convert into Class A ordinary shares concurrently with or immediately following the closing of our initial business combination on a one-for-one |
(8) | Compass Digital SPAC LLC, our sponsor, is the record holder of such shares, and Compass Digital SPAC LLC is controlled by a board of managers consisting of entities controlled by Abidali Neemuchwala and Satish Gupta. Each manager of Compass Digital SPAC LLC has one vote, and the approval of both managers is required to approve an action of Compass Digital SPAC LLC. If both managers cannot agree on a matter, then the matter must be submitted to Abidali Neemuchwala, Satish Gupta, Vikram S. Pandit and Steve Freiberg for approval, with the holders of a majority of the founder share interests held by the four members through the sponsor being required for any such approval. |
(9) | All of our officers and directors will own limited liability company interests of our sponsor. |
For the Year Ended December 31, 2021 |
||||
Audit Fees(1) |
$ | 98,260 | ||
Audit-Related Fees(2) |
$ | |||
Tax Fees(3) |
$ | |||
All Other Fees(4) |
$ | |||
Total Fees |
$ | 98,260 |
(1) | Audit Fees. Audit fees consist of fees billed for professional services rendered for the audit of our year-end financial statements and services that are normally provided by our independent registered public accounting firm in connection with statutory and regulatory filings. |
(2) | Audit-Related Fees. Audit-related fees consist of fees billed for assurance and related services that are reasonably related to performance of the audit or review of our year-end financial statements and are not reported under “Audit Fees.” These services include attest services that are not required by statute or regulation and consultation concerning financial accounting and reporting standards. |
(3) | Tax Fees. Tax fees consist of fees billed for professional services relating to tax compliance, tax planning and tax advice. |
(4) | All Other Fees. All other fees consist of fees billed for all other services. |
(a) | The following documents are filed as part of this report: |
(1) | Financial Statements |
Page | ||
F-2 | ||
F-3 | ||
F-4 | ||
F-5 | ||
F-6 | ||
F-7 - 22 |
(2) | Financial Statement Schedule |
(3) | Exhibits |
COMPASS DIGITAL ACQUISITION CORP. | ||
By: | /s/ Abidali Neemuchwala | |
Name: Abidali Neemuchwala | ||
Title: Chairman and Chief Executive Officer |
Name |
Positon |
Date | ||
/s/ Abidali Neemuchwala |
Chief Executive Officer and Chairman (Principal Executive Officer) | February 23, 2022 | ||
Abidali Neemuchwala | ||||
/s/ Burhan Jaffer |
Chief Financial Officer | February 23, 2022 | ||
Burhan Jaffer | ||||
/s/ Satish Gupta |
Director | February 23, 2022 | ||
Satish Gupta | ||||
/s/ Steven Freiberg |
Director | February 23, 2022 | ||
Steven Freiberg | ||||
/s/ Deborah Hopkins |
Director | February 23, 2022 | ||
Deborah Hopkins | ||||
/s/ Bill Owens |
Director |
February 23, 2022 | ||
Bill Owens | ||||
/s/ Jon Zieger |
Director | February 23, 2022 | ||
Jon Zieger |
F-2 | ||||
Financial Statements: |
||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
F-7 to F-22 |
ASSETS |
||||
Cash |
$ | |||
Prepaid insurance |
||||
|
|
|||
Total Current Assets |
||||
Investment held in Trust Account |
||||
Long-term prepaid insurance |
|
|
|
|
|
|
|||
Total Assets |
$ |
|||
|
|
|||
LIABILITIES, CLASS A ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION AND SHAREHOLDERS’ DEFICIT |
||||
Current Liabilities |
||||
Accrued expenses |
$ | |||
Due to Sponsor |
||||
Total Current Liabilities |
||||
Deferred Underwriters Fees Payable |
||||
Note Payable |
||||
Warrant Liability |
||||
|
|
|||
Total Liabilities |
||||
|
|
|||
Commitments and Contingencies (Note 6) |
||||
Class A ordinary shares - |
||||
Shareholders’ Deficit |
||||
Preference shares - $ |
||||
Class A ordinary shares - $ (excluding the redemption) |
||||
Class B ordinary shares - $ |
||||
Additional paid-in capital |
||||
Accumulated Deficit |
( |
) | ||
|
|
|||
Total Shareholders’ Deficit |
( |
) | ||
|
|
|||
Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholder’s Deficit |
$ |
|||
|
|
Formation costs and other operating expenses |
$ |
|||
|
|
|||
Loss from operations |
( |
) | ||
Other income (expense) |
||||
Interest income |
||||
Change in fair value of warrant liabilities |
( |
) | ||
|
|
|||
Net Loss |
$ |
( |
) | |
|
|
|||
Weighted average Class A ordinary shares outstanding, basic and diluted |
||||
|
|
|||
Basic and diluted net loss per share, Class A |
$ |
( |
) | |
|
|
|||
Weighted average Class B ordinary shares outstanding, basic and diluted |
||||
Basic and diluted net loss per share, Class B |
$ |
( |
) | |
|
|
Class A |
Class B |
Total |
||||||||||||||||||||||||||
Ordinary Shares |
Ordinary Shares |
Additional |
Accumulated |
Shareholder’s |
||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
Paid-in Capital |
Deficit |
Deficit |
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Balances at March 8, 2021 (Inception) |
— |
$ |
— |
$ |
$ |
$ |
$ |
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Issuance of Class B ordinary shares to Sponsor |
— |
— |
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Sale of units through public offering, less fair value of public warrants |
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Offering Costs |
( |
) |
( |
) | ||||||||||||||||||||||||
Sale o f private placement warrants, less fair value of private warrants |
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Forfeited Founder Shares |
( |
) |
( |
) |
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Shares subject to possible redemption |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||||||||||||||
Reclassification of APIC to Accumulated Deficit |
( |
) |
— |
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Net loss |
( |
) | ( |
) | ||||||||||||||||||||||||
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Balances at December 31, 2021 |
$ |
$ |
$ |
$ |
( |
) | $ |
( |
) | |||||||||||||||||||
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Cash Flows from Operating Activities |
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Net loss |
$ |
( |
) | |
Adjustments to reconcile net loss to net cash used in operating activities: |
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Interest earned on marketable securities held in trust account |
( |
) | ||
Change in fair value of warrant liabilities |
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Allocation of offering costs and founders shares to warrant expense |
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Changes in operating assets and liabilities |
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Prepaid expenses |
( |
) | ||
Accrued expenses |
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Due to Sponsor |
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Net Cash used in Operating Activities |
( |
) | ||
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Cash Flows from Investment Activities |
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Investment of cash into Trust Account |
( |
) | ||
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Net Cash used in Investment Activities |
( |
) | ||
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Cash Flows from Financing Activities |
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Proceeds from sale of Class A ordinary shares, net of underwriting discounts |
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Proceeds from Note Payable |
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Proceeds from private warrants |
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Payment of offering costs |
( |
) | ||
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Net Cash provided by Financing Activities |
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Net change in cash |
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Cash, |
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Cash, |
$ |
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Non-cash investing and financing activities: |
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Deferred underwriting commissions |
$ |
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Offering costs paid by Sponsor in exchange for issuance of Class B ordinary shares |
$ |
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Initial Measurement of the Public Warrants issued |
$ |
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Initial Measurement of the Private Placement Warrants issued |
$ |
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|
For the Period from March 8, 2021 (inception) to December 31, 2021 |
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Class A |
Class B |
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EPS: |
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Numerator: Net Income (Loss) |
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Allocation of net loss |
$ | ( |
) | $ | ( |
) | ||
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Denominator: Weighted Average shares |
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Basic and diluted weighted average shares outstanding |
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Basic and diluted net loss per ordinary share |
$ | ( |
) | $ | ( |
) | ||
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• |
in whole and not in part; |
• |
at a price of $0.01 per Public Warrant; |
• |
upon a minimum of 30 days’ prior written notice of redemption, which we refer to as the 30-day redemption period; and |
• |
if, and only if, the closing price of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders (the “Reference Value”). |
• |
in whole and not in part; |
• |
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption, provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive the number of shares determined by reference to the table set forth under “Description of Securities - Warrants - Public Shareholders’ Warrants” based on the redemption date and the “fair market value” of our Class A ordinary shares (as defined below); |
• |
if, and only if, the Reference Value (as defined above under “Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00”) equals or exceeds $10.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like); and |
• |
if the Reference Value is less than $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like), the private placement warrants must also concurrently be called for redemption on the same terms (except as described herein with respect to a holder’s ability to cashless exercise its warrants) as the outstanding public warrants, as described above. |
Description |
Level |
December 31, 2021 |
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Liabilities: |
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Private Placement Warrants (1) |
3 |
$ | ||||||
Public Warrants (1) |
1 |
(1) |
Measured at fair value on a recurring basis. |
Input |
(Initial Measurement) |
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Risk-free interest rate |
% | ||||
Expected term (years) |
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Expected volatility |
% | ||||
Exercise price |
$ | ||||
Fair value of Units |
$ |
• | The risk-free interest rate assumption was based on the five-year U.S. Treasury rate, which was commensurate with the contractual term of the Warrants, which expire on the earlier of (i) five years after the completion of the initial business combination and (ii) upon redemption or liquidation. An increase in the risk-free interest rate, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa. |
• | The expected term was determined to be slightly over five years, in-line with a typical equity investor assumed holding period |
• | The expected volatility assumption was based on the implied volatility from a set of comparable publicly-traded warrants as determined based on the size and proximity of business combinations by similar special purpose acquisition companies. An increase in the expected volatility, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa. |
• | The fair value of the Units, which each consist of one Class A ordinary shares and one-third of one Public Warrant, represents the closing price on the measurement date as observed from the ticker CDAQU. |
Private Placement |
Public |
Warrant Liabilities |
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Fair value as of March 8, 2021 (inception) |
$ | $ | $ | |||||||||
Issuance of Public of Private Warrants |
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Change in valuation inputs or other assumptions (1) |
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Fair value as of December 31, 2021 (2) |
$ | $ | $ | |||||||||
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(1) |
Changes in valuation inputs or other assumptions are recognized in change in fair value of warrant liabilities in the Statement of Operations. |
(2) |
Transfers to/from Levels 1, 2 and 3 are recognized at the end of the reporting period. The estimated fair value of the Public Warrants transferred from a Level 3 measurement to a Level 1 measurement during the period ended December 31, 2021 when the Public Warrants were separately listed and traded. The estimated fair value of the Private Warrants transferred from a Level 3 measurement to a Level 2 measurement during the period ended December 31, 2021 when the Public Warrants were separately listed and traded and utilized as an input. |