F-4/A 1 tm236957-20_f4a.htm FORM F-4/A tm236957-20_f4a - block - 109.4949711s
As filed with the Securities and Exchange Commission on November 15, 2023.
Registration No. 333-275001
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1
to
FORM F-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Lotus Technology Inc.
(Exact Name of Registrant as Specified in Its Charter)
Cayman Islands
(State or Other Jurisdiction of
Incorporation or Organization)
3711
(Primary Standard Industrial
Classification Code Number)
Not Applicable
(I.R.S. Employer
Identification Number)
No. 800 Century Avenue
Pudong District, Shanghai, People’s Republic of China
+86 21 5466-6258
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Cogency Global Inc.
122 East 42nd Street, 18th Floor
New York, NY 10168
+1(800) 221-0102
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Shu Du, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
c/o 42/F, Edinburgh Tower, The Landmark
15 Queen’s Road Central
Hong Kong
Tel: +852 3740-4700
Peter X. Huang, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
30/F, China World Office 2
1 Jian Guo Men Wai Avenue
Chaoyang District, Beijing 100004
People’s Republic of China
Tel: +86 10 6535-5500
Jesse Sheley, Esq.
Joseph Casey Raymond, Esq.
Kirkland & Ellis International LLP
26th Floor, Gloucester Tower, The Landmark
15 Queen’s Road Central
Hong Kong
Tel: +852 3761-3444
Steve Lin, Esq.
Justin You Zhou, Esq.
Kirkland & Ellis International LLP
58th Floor, China World Tower A
No. 1 Jian Guo Men Wai Avenue
Chaoyang District, Beijing 100004
People’s Republic of China
+86 10 5737-9315
Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement becomes effective.
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ☐
If this Form is a post-effective amendment pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration for the share offering.   ☐
If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)   ☐
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)   ☐
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
Emerging growth company   ☒
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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 7(a)(2)(B) of the Securities Act.   ☐
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

The information in this preliminary proxy statement/prospectus is not complete and may be changed. We may not issue these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary proxy statement/prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
PRELIMINARY — SUBJECT TO COMPLETION, DATED NOVEMBER 15, 2023
PROXY STATEMENT FOR EXTRAORDINARY GENERAL MEETING OF SHAREHOLDERS OF
[MISSING IMAGE: lg_catterton-4clr.jpg]
L Catterton Asia Acquisition Corp
and
PROSPECTUS FOR UP TO 28,946,340 LTC ORDINARY SHARES REPRESENTED BY AMERICAN DEPOSITARY SHARES, 15,037,075 LTC WARRANTS AND
15,037,075 LTC ORDINARY SHARES REPRESENTED BY AMERICAN DEPOSITARY SHARES ISSUABLE UPON EXERCISE OF LTC WARRANTS
OF
[MISSING IMAGE: lg_lotus-4c.jpg]
Lotus Technology Inc.
The board of directors of L Catterton Asia Acquisition Corp (“LCAA”), a Cayman Islands exempted company, has approved the Agreement and Plan of Merger, dated as of January 31, 2023 (as amended and restated by the First Amended and Restated Agreement and Plan of Merger, dated as of October 11, 2023 and as may be further amended, supplemented or otherwise modified from time to time, the “Merger Agreement”) by and among LCAA, Lotus Technology Inc. (“LTC”), a Cayman Islands exempted company, Lotus Temp Limited, a Cayman Islands exempted company and wholly-owned subsidiary of LTC (“Merger Sub 1”), and Lotus EV Limited, a Cayman Islands exempted company and wholly-owned subsidiary of LTC ( “Merger Sub 2”). Pursuant to the Merger Agreement, (i) Merger Sub 1 will merge with and into LCAA (the “First Merger”), with LCAA surviving the First Merger as a wholly-owned subsidiary of LTC (such company, as the surviving entity of the First Merger, “Surviving Entity 1”) and the shareholders of LCAA becoming shareholders of LTC, and (ii) immediately following the First Merger and as part of the same overall transaction as the First Merger, Surviving Entity 1 will merge with and into Merger Sub 2 (the “Second Merger,” and together with the First Merger, the “Mergers”), with Merger Sub 2 surviving the Second Merger as a wholly-owned subsidiary of LTC (such company, as the surviving entity of the Second Merger, “Surviving Entity 2”) (collectively, the “Business Combination”).
LCAA shareholders are being asked to consider a vote upon the Business Combination and certain proposals related thereto as described in this proxy statement/prospectus. As a result of the Business Combination, and upon consummation of the Business Combination and the other transactions contemplated by the Merger Agreement (the “Transactions”), Merger Sub 2 (as the successor to LCAA) will become a wholly-owned subsidiary of LTC, with the shareholders of LCAA becoming shareholders of LTC.
Pursuant to the Merger Agreement on the date of closing of the Transactions (such closing, the “Closing,” and the day on which the Closing occurs, the “Closing Date”) and immediately prior to the effective time of the First Merger (the “First Effective Time”), the following actions shall take place or be effected (in the order set forth hereinafter): (i) each preferred share of LTC that is issued and outstanding immediately prior to such time shall be converted into one ordinary share on a one-for-one basis, by re-designation and re-classification, in accordance with the fifth amended and restated memorandum and articles of association of LTC (the “LTC Articles”) (the “Preferred Share Conversion”), (ii) the sixth amended and restated memorandum and articles of association of LTC (“Amended LTC Articles”) shall be adopted and become effective; (iii) immediately following the Preferred Share Conversion but immediately prior to the Recapitalization (as defined below), 500,000,000 authorized but unissued ordinary shares of LTC shall be re-designated as shares of a par value of US$0.00001 each of such class or classes (however designated) as the board of directors of LTC (the “LTC

Board”) may determine in accordance with the Amended LTC Articles, such that the authorized share capital of LTC shall be US$50,000 divided into 5,000,000,000 shares of par value of US$0.00001 each, consisting of 4,500,000,000 ordinary shares of a par value of US$0.00001 each (“LTC Ordinary Shares”), and 500,000,000 shares of a par value of US$0.00001 each of such class or classes (however designated) as the LTC Board may determine in accordance with the Amended LTC Articles (the “Re-designation”). Immediately following the Re-designation and prior to the First Effective Time, (i) each issued LTC Ordinary Share shall be recapitalized by way of a repurchase in exchange for the issuance of such number of LTC Ordinary Shares equal to the Recapitalization Factor (as defined below) (i.e., one such LTC Ordinary Share multiplied by the Recapitalization Factor) (the “Recapitalization”); provided that no fraction of an LTC Ordinary Share will be issued by virtue of the Recapitalization, and each shareholder that would otherwise be so entitled to a fraction of an LTC Ordinary Share (after aggregating all fractional LTC Ordinary Shares that otherwise would be received by such shareholder) shall instead be entitled to receive such number of LTC Ordinary Shares to which such shareholder would otherwise be entitled, rounded down to the nearest whole number, (ii) any options exercisable to purchase shares of LTC (“LTC Options”) issued and outstanding immediately prior to the Recapitalization shall be adjusted to give effect to the foregoing transactions, such that (a) each LTC Option shall be exercisable for that number of LTC Ordinary Shares equal to the product of (x) the number of ordinary shares of LTC subject to such LTC Option immediately prior to the Recapitalization multiplied by (y) the Recapitalization Factor, such number of LTC Ordinary Shares to be rounded down to the nearest whole number; and (b) the per share exercise price for each LTC Ordinary Share, as the case may be, issuable upon exercise of the LTC Options, as adjusted, shall be equal to the quotient (rounded up to the nearest whole cent) obtained by dividing (x) the per share exercise price for each ordinary share of LTC subject to such LTC Option immediately prior to the First Effective Time by (y) the Recapitalization Factor (together with the adoption of the Amended LTC Articles, Preferred Share Conversion, the Re-designation and the Recapitalization, the “Capital Restructuring”). The Recapitalization Factor shall be adjusted to reflect appropriately the effect of any share subdivision, capitalization, share dividend or share distribution (including any dividend or distribution of securities convertible into shares of LTC), reorganization, recapitalization, reclassification, consolidation, exchange of shares or other like change (in each case, other than the Capital Restructuring) with respect to shares of LTC occurring on or after the date of the Merger Agreement and prior to the Closing Date.
In addition, pursuant to the Merger Agreement, (i) immediately prior to the First Effective Time, each Class B ordinary share of LCAA, par value $0.0001 per share (“LCAA Class B Ordinary Shares”) will be automatically converted into one Class A ordinary share of LCAA (“LCAA Class A Ordinary Shares”) in accordance with the terms of the second amended and restatement memorandum and articles of association of LCAA (the “LCAA Articles”) (such automatic conversion, the “LCAA Class B Conversion”), and each LCAA Class B Ordinary Shares shall no longer be issued and outstanding and shall be cancelled, and each former holder of LCAA Class B Ordinary Shares shall thereafter cease to have any rights with respect to such shares, (ii) at the First Effective Time, each unit (the “Unit”) issued by LCAA in its IPO or the exercise of the underwriter’s overallotment option, each consisting of one LCAA Class A Ordinary Share and one-third of a warrant (the “LCAA Warrant”) issued by LCAA to acquire LCAA Class A Ordinary Share, outstanding immediately prior to the First Effective Time shall be automatically detached and the holder thereof shall be deemed to hold one LCAA Class A Ordinary Share and one-third of an LCAA Warrant in accordance with the terms of the applicable Unit (the “Unit Separation”); provided that no fractional LCAA Warrant will be issued in connection with the Unit Separation such that if a holder of Units would be entitled to receive a fractional LCAA Warrant upon the Unit Separation, the number of LCAA Warrants to be issued to such holder upon the Unit Separation shall be rounded down to the nearest whole number of LCAA Warrants, (iii) immediately following the Unit Separation, each LCAA Class A Ordinary Share (which, for the avoidance of doubt, includes the LCAA Class A Ordinary Shares (A) issued in connection with the LCAA Class B Conversion and (B) held as a result of the Unit Separation) issued and outstanding immediately prior to the First Effective Time (other than any ordinary shares of LCAA (“LCAA Shares”) that are owned by LCAA as treasury shares, any LCAA Shares owned by any direct or indirect subsidiary of LCAA immediately prior to the First Effective Time, any LCAA Shares in respect of which the eligible holder thereof has validly exercised (and not validly revoked, withdrawn or lost) such holder’s redemption right (“Redeeming LCAA Shares”), any LCAA Shares that are held by LCAA shareholder who shall have validly exercised their dissenter’s rights for such shares in accordance with Section 238 of the Companies Act (As Revised) of the Cayman Islands (“Cayman Islands Companies Act”) and otherwise complied with all of the provisions of the Cayman Islands Companies Act relevant to the exercise and perfection of dissenters’ rights (“Dissenting LCAA Shares”) or any LCAA Shares held by the Sponsor (as defined below) and the independent directors of LCAA (collectively, the “Founder Shareholders”) shall automatically be cancelled and cease to exist in exchange for the right to receive one American depositary share of LTC duly and validly issued against the deposit of one (1) underlying LTC Ordinary Share (each, an “LTC ADS”) and each LCAA Class A Ordinary Share issued and outstanding immediately prior to the First Effective Time held by the Founder Shareholders shall automatically be cancelled and cease to exist in exchange for the right to receive one (1) LTC Ordinary Share. As of the First Effective Time, each LCAA shareholder shall cease to have any other rights in and to such LCAA Shares, except as expressly provided in the Merger Agreement, (iv) each LCAA Warrant (which, for the avoidance of doubt, includes the LCAA Warrants held as a result of the Unit Separation) outstanding immediately prior to the First Effective Time shall cease to be a warrant with respect to LCAA Public Shares and be assumed by LTC and converted into a warrant to purchase one LTC Ordinary Share in the form of LTC ADS (each, a “LTC Warrant”). Each LTC Warrant shall continue to have and be subject to substantially the same terms and conditions as were applicable to such LCAA Warrant immediately prior to the First Effective Time (including any repurchase rights and cashless exercise provisions) in accordance with the provisions of the Assignment, Assumption and Amendment Agreement.

At the First Effective Time, each ordinary share, par value $0.00001 per share, of Merger Sub 1, issued and outstanding immediately prior to the First Effective Time shall remain issued and outstanding and continue existing and constitute the only issued and outstanding share capital of Surviving Entity 1 and shall not be affected by the First Merger. At the Second Effective Time, (i) each ordinary share of Surviving Entity 1 that is issued and outstanding immediately prior to the Second Effective Time will be automatically cancelled and cease to exist without any payment therefor, and (ii) each ordinary share, par value $0.00001 per share, of Merger Sub 2 issued and outstanding immediately prior to the Second Effective Time shall remain issued and outstanding and continue existing and constitute the only issued and outstanding share capital of Surviving Entity 2 and shall not be affected by the Second Merger.
We estimate that, immediately after the Closing, assuming none of the holders of LCAA Class A Ordinary Shares (“LCAA Public Shareholders”) exercise their redemption rights, (i) the existing shareholders of LTC will own 87.51% of the issued and outstanding LTC Ordinary Shares, (ii) LCAA Public Shareholders will own 3.51% of the issued and outstanding LTC Ordinary Shares (represented by LTC ADSs), and (iii) LCA Acquisition Sponsor LP, a Cayman Islands exempted limited partnership (the “Sponsor”) and the independent directors of LCAA will collectively own 1.16% of the issued and outstanding LTC Ordinary Shares. The foregoing numbers of percentage ownership have been determined under the assumptions set forth under the section titled “Frequently Used Terms and Basis of Presentation.” If actual facts are different from the assumptions set forth therein, the percentage ownership numbers will be different. As a result, upon the consummation of the Business Combination, LTC may qualify as a “controlled company” as defined under the corporate governance rules of The Nasdaq Stock Market (“Nasdaq”), because it is expected that Mr. Shufu Li will beneficially own more than 50% of the total voting power of all issued and outstanding LTC Ordinary Shares immediately following the consummation of the Business Combination, assuming a no Redemption Scenario. In addition, LTC is a foreign private issuer within the meaning of the rules under the Exchange Act and, as such, LTC is permitted to follow the corporate governance practices of its home country, the Cayman Islands, in lieu of the corporate governance standards of Nasdaq applicable to U.S. domestic companies. For so long as LTC remains a controlled company under that definition, it is permitted to elect to rely, and may rely, on certain exemptions from Nasdaq corporate governance rules. As a foreign private issuer and a “controlled company”, LTC is permitted to elect to rely, and may rely, on certain exemptions from corporate governance rules, including (i) an exemption from the rule that a majority of our board of directors must be independent directors; (ii) an exemption from the rule that director nominees must be selected or recommended solely by independent directors; (iii) an exemption from the rule that the compensation committee must be comprised solely of independent directors and (iv) an exemption from the requirement that an audit committee be comprised of at least three members under Nasdaq Rule 5605(c)(2)(A). LTC intends to rely on all of the foregoing exemptions available to foreign private issuers and “controlled company.”
The U.S. federal income tax consequences of the Mergers will depend on whether the Mergers, taken together, qualify as a tax-free reorganization within the meaning of Section 368(a) of the Code (a “reorganization”). To qualify as a reorganization, a transaction must generally satisfy certain requirements, including, among others, that the acquiring corporation continue, either directly or indirectly through certain controlled corporations, a significant line of the acquired corporation’s historic business or use a significant portion of the acquired corporation’s historic business assets, in each case, within the meaning of Treasury Regulations Section 1.368-1(d). Due to the absence of guidance regarding the application of this requirement to the particular facts of the Mergers, the qualification of the Mergers as a reorganization is subject to significant uncertainty. If the Mergers fail to qualify as a reorganization, then a U.S. Holder (as defined in the section of this proxy statement/prospectus entitled “Material Tax Considerations — U.S. Federal Income Tax Considerations”) will generally recognize gain or loss in an amount equal to the difference between the fair market value (as of the closing date of the Merger) of LTC ADSs and LTC Warrants received in the Mergers, over such holder’s aggregate adjusted tax basis in the corresponding LCAA Class A Ordinary Shares and LCAA Public Warrants surrendered by such holder in the Mergers. See the section of this proxy statement/prospectus entitled “Material Tax Considerations — U.S. Federal Income Tax Considerations — Effects of the Mergers — Characterization of the Mergers as a Tax-Free Reorganization under Section 368(a) of the Code.”
LTC is not an operating company but a Cayman Islands holding company. LTC conducts its operations through its subsidiaries in China and Europe and its operations in mainland China are currently conducted by its mainland China subsidiaries. The securities registered herein are securities of LTC, not those of its operating subsidiaries. Therefore, investors in LTC are not acquiring equity interest in any operating company but instead are acquiring interest in a Cayman Islands holding company. Historically, LTC relied on contractual arrangements among Wuhan Lotus Technology Limited Company Ltd. (the “WFOE”), Wuhan Lotus E-commerce Co., Ltd., the former variable interest entity (“VIE”) and its nominee shareholders to direct the business operations of the former VIE and its subsidiaries. Since early 2023, LTC has been implementing a series of transactions to restructure its organization and business operations (the “Restructuring”). In connection with the Restructuring, the WFOE, the former VIE and nominee equity holders of the former VIE entered into a series of agreements (the “VIE Restructuring Agreements”), pursuant to which the WFOE acquired 100% equity interest in the former VIE’s subsidiaries. As of the date of this proxy statement/prospectus, LTC’s operations in mainland China are conducted by its mainland China subsidiaries and LTC does not have any VIE structure.
The holding company structure involves unique risks to investors. As a holding company, LTC may rely on dividends from its subsidiaries for cash requirements, including any payment of dividends to its shareholders. The ability of subsidiaries of LTC to

pay dividends or make distributions to LTC may be restricted by laws and regulations applicable to them or the debt they incur on their own behalf or the instruments governing their debt. In addition, PRC regulatory authorities could disallow this holding company structure and limit or hinder LTC’s ability to conduct its business through, receive dividends or distributions from, or transfer funds to, the operating companies or list on a U.S. or other foreign exchange, which could result in a material adverse change in LTC’s operations and cause the value of the securities of LTC to significantly decline. See “Summary of the Proxy Statement/Prospectus — Corporate History and Structure of Lotus Tech.” LTC’s board of directors has complete discretion on whether to distribute dividends subject to its memorandum and articles of association and certain restrictions under Cayman Islands law. In addition, LTC’s shareholders may, by ordinary resolution, declare dividends, but no dividend shall exceed the amount recommended by LTC’s board of directors. Under Cayman Islands law, a Cayman Islands company may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts as they fall due in the ordinary course of business. The decision to distribute dividends is based on several factors, including LTC’s financial performance, growth prospects, and liquidity requirements. To date, no dividend or distributions have been made by the subsidiaries of LTC to LTC. For further details of cash and asset flows between LTC, its subsidiaries and the former VIE, see “Summary of the Proxy Statement/ Prospectus — Cash and Asset Flows through Lotus Tech’s Organization.” Lotus Tech has established cash management policies to direct how funds are transferred among LTC and its subsidiaries to ensure the efficient and compliant handling of funds. These policies dictate that, each cash transfer shall (i) go through approval processes, ensuring that only authorized personnel are involved in the transaction, (ii) be properly recorded to facilitate audits and financial reviews, and (iii) be in compliance with all applicable laws and regulations, including anti-money laundering (AML) and know-your-customer (KYC) requirements. Unless otherwise stated or unless the context otherwise requires, references in this proxy statement/prospectus to (i) “LTC” are to Lotus Technology Inc., and (ii) “Lotus Tech,” “we,” “us,” “our company,” and “our” are to LTC and its subsidiaries. Unless otherwise specified, in the context of describing our business and operations in China, we are referring to the business and operations conducted by our PRC subsidiaries, and for the periods ended prior to the Restructuring, also the former VIE and its subsidiaries.
Lotus Tech faces various risks and uncertainties relating to doing business in China. Lotus Tech has substantial business operations in mainland China, and it is subject to complex and evolving laws and regulations of mainland China. For example, it faces risks associated with regulatory approvals on overseas offerings, anti-monopoly regulatory actions, and oversight on cybersecurity, data security and data privacy, as well as the lack of inspection on its auditors by the Public Company Accounting Oversight Board (the “PCAOB”) which may impact its ability to conduct certain businesses, accept foreign investments, or list and conduct offerings on a United States or other foreign exchange. The PRC government’s significant authority in regulating Lotus Tech’s operations and the PRC government’s oversight and control over offerings conducted overseas by, and foreign investment in, China-based issuers could result in a material adverse change in Lotus Tech’s operations and the value of its securities, significantly limit or completely hinder its ability to continue to offer securities to investors, or cause the value of such securities to significantly decline. For a detailed description of risks relating to doing business in China, see “Risk Factors — Risks Relating to Doing Business in China.”
LTC’s securities will be prohibited from trading on a national securities exchange or in the over-the-counter trading market in the United States under the Holding Foreign Companies Accountable Act (“HFCAA”) if the Securities and Exchange Commission (the “SEC”) determines that LTC has filed audit reports issued by a registered public accounting firm that has not been subject to inspections by the PCAOB for two consecutive years. On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong and our auditor was subject to this determination. On December 15, 2022, the PCAOB announced that it was able to secure complete access to inspect and investigate PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong in 2022. Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms in mainland China and Hong Kong, among other jurisdictions. If the PCAOB determines in the future that it no longer has full access to inspect and investigate completely accounting firms in mainland China and Hong Kong and LTC uses an accounting firm headquartered in one of these jurisdictions to issue an audit report on its financial statements filed with the SEC, LTC would be identified as a Commission-Identified Issuer following the filing of the annual report on Form 20-F for the relevant fiscal year. In accordance with the HFCAA, LTC’s securities would be prohibited from being traded on a national securities exchange or in the over-the-counter trading market in the United States if it is identified as a Commission-Identified Issuer for two consecutive years in the future. If LTC’s securities are prohibited from trading in the United States, there is no certainty that it will be able to list on a non-U.S. exchange or that a market for its securities will develop outside of the United States. In the event of such prohibition, the Nasdaq may determine to delist our securities. The delisting of LTC’s securities, or the threat of their being delisted, may materially and adversely affect the value of your investment. For more details, see “Risk Factors — Risks Relating to Doing Business in China — The PCAOB had historically been unable to inspect our auditor in relation to their audit work” and “Risk Factors — Risks Relating to Doing Business in China —  Our securities may be prohibited from trading in the United States under the Holding Foreign Companies Accountable Act, or the HFCAA, if the PCAOB is unable to inspect or investigate completely auditors located in China. The delisting of our securities, or the threat of their being delisted, may materially and adversely affect the value of your investment.”
Proposals to approve the Merger Agreement and the other matters discussed in this proxy statement/prospectus shall be presented at the extraordinary general meeting of shareholders of LCAA scheduled to be held on                  .

Although LTC is not currently a public reporting company, following the effectiveness of the registration statement of which the accompanying proxy statement/prospectus is a part and the closing of the Business Combination, LTC will become subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). LTC intends to apply for the listing of LTC ADSs and LTC Warrants on the Nasdaq under the proposed symbols “LOT” and “LOTWW,” respectively, to be effective at the consummation of the Business Combination. It is a condition of the consummation of the Business Combination that LTC ADSs and the LTC Warrants to be issued in connection with the Transactions are approved for listing on Nasdaq (subject to official notice of issuance).While trading on Nasdaq is expected to begin on the first business day following the date of completion of the Business Combination, there can be no assurance that LTC’s securities will be listed on Nasdaq or that a viable and active trading market will develop. This proxy statement/prospectus provides you with detailed information about the Business Combination and other matters to be considered at the extraordinary general meeting of LCAA shareholders. We encourage you to carefully read this entire document. You should, in particular, carefully consider the risk factors described in “Risk Factors” beginning on page 80 of this proxy statement/prospectus.
LCAA Board has unanimously approved and adopted the Merger Agreement and unanimously recommends that the LCAA shareholders vote FOR all of the proposals presented to the shareholders at the extraordinary general meeting. When you consider LCAA Board’s recommendation of these proposals, you should keep in mind that LCAA’s directors and officers have interests in the Business Combination that may conflict with your interests as a shareholder. See “Proposal Two — The Business Combination Proposal — Interests of LCAA’s Directors and Officers in the Business Combination.”
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THIS PROXY STATEMENT/PROSPECTUS OR ANY OF THE SECURITIES TO BE ISSUED IN THE BUSINESS COMBINATION, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.
This proxy statement/prospectus is dated      and is first being mailed to LCAA shareholders on or about      .

 
ADDITIONAL INFORMATION
This proxy statement/prospectus incorporates important business and financial information about Lotus Tech and LCAA that is not included in or delivered with this proxy statement/prospectus. This information is available to you without charge upon written or oral request. If you would like to receive any of the additional information, please contact:
L Catterton Asia Acquisition Corp
8 Marina View, Asia Square Tower 1
#41-03, Singapore 018960
Attention: Katie Matarazzo/Chris Youm
Telephone: +65 6672-7600
Email: investorservices@lcatterton.com
To obtain timely delivery of the documents, you must request them no later than five business days before the date of the extraordinary general meeting, or no later than                  .
 

 
PRELIMINARY — SUBJECT TO COMPLETION, DATED NOVEMBER 15, 2023
L CATTERTON ASIA ACQUISITION CORP
8 Marina View, Asia Square Tower 1
#41-03, Singapore 018960
Dear L Catterton Asia Acquisition Corp Shareholders:
You are cordially invited to attend the extraordinary general meeting of shareholders of L Catterton Asia Acquisition Corp, an exempted company limited by shares incorporated under the laws of the Cayman Islands (“LCAA”), at           AM           time, on            , 2023 at             and virtually over the Internet via live audio webcast at           , and on such other date and at such other place to which the meeting may be adjourned. While as a matter of Cayman Islands law we are required to have a physical location for the meeting, we are pleased to utilize virtual shareholder meeting technology to provide ready access and cost savings for LCAA shareholders and LCAA. We encourage shareholders to attend the extraordinary general meeting virtually. The virtual meeting format allows attendance from any location in the world. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the accompanying proxy statement/prospectus.
The extraordinary general meeting shall be held for the following purpose:
1.
to consider and vote upon, as a special resolution, a proposal (the “NTA Proposal”) to approve and adopt the amendment to the second amended and restated memorandum and articles of association of LCAA (the “LCAA Articles”) set forth in Annex D of this proxy statement/prospectus, which amendment (the “NTA Amendment”) shall become effective immediately prior to the consummation of the proposed Business Combination, to remove from the LCAA Articles the prohibition on redemptions of LCAA Public Shares in an amount that cause LCAA’s net tangible assets (“NTA”) to be less than $5,000,001 in connection with any vote held to approve a proposed business combination. The NTA Proposal is conditioned upon the approval of the Business Combination Proposal. Therefore, if the Business Combination Proposal is not approved, then the NTA Proposal will have no effect, even if approved by LCAA shareholders. A copy of the NTA Amendment to the LCAA Articles is attached to this proxy statement/prospectus as Annex D;
2.
to consider and vote upon, as an ordinary resolution, a proposal (the “Business Combination Proposal”) to approve and authorize the Agreement and Plan of Merger, dated as of January 31, 2023 (as amended and restated by the First Amended and Restated Agreement and Plan of Merger, dated as of October 11, 2023, the “Merger Agreement”), by and among LCAA, Lotus Technology Inc., an exempted company limited by shares incorporated under the laws of the Cayman Islands (the “Company” or “LTC”), Lotus Temp Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a wholly-owned subsidiary of LTC (“Merger Sub 1”), and Lotus EV Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a wholly-owned subsidiary of LTC (“Merger Sub 2”), a copy of which is attached to this proxy statement/prospectus as Annex A, and the transactions contemplated therein, including the business combination whereby Merger Sub 1 will merge with and into LCAA (the “First Merger”), with LCAA surviving the First Merger as a wholly-owned subsidiary of LTC (such company, as the surviving entity of the First Merger, “Surviving Entity 1”), and immediately following the consummation of the First Merger, Surviving Entity 1 will merge with and into Merger Sub 2 (the “Second Merger,” and together with the First Merger, collectively, the “Mergers”), with Merger Sub 2 surviving the Second Merger as a wholly-owned subsidiary of LTC (the transactions contemplated by the Merger Agreement, including the Mergers, collectively, the “Business Combination”);
3.
to consider and vote upon, as a special resolution, a proposal (the “Merger Proposal”) to approve and authorize the First Merger and the First Plan of Merger, substantially in the form attached as Exhibit F to the Merger Agreement (the “First Plan of Merger”); and
4.
to consider and vote upon, as an ordinary resolution, a proposal (the “Adjournment Proposal”) to adjourn the extraordinary general meeting to a later date or dates to be determined by the chairman of the extraordinary general meeting, if necessary, to permit further solicitation and vote of proxies
 

 
if, based upon the tabulated vote at the time of the extraordinary general meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote or if holders of LCAA Public Shares, have elected to redeem an amount of LCAA Public Shares such that the minimum available cash condition or the net tangible assets condition contained in the Merger Agreement would not be satisfied.
The NTA Proposal is conditioned upon the approval of the Business Combination Proposal. The closing of the Business Combination is conditioned on approval of the Business Combination Proposal and the Merger Proposal. If either of these proposals is not approved, then LCAA will not consummate the Business Combination. The Adjournment Proposal is not conditioned on the approval of any other proposal listed above.
Each of these proposals is more fully described in the accompanying proxy statement/prospectus, which each shareholder is encouraged to read carefully and in its entirety. Only holders of record of LCAA Shares at the close of business on            , 2023 (the “record date”) are entitled to notice of the extraordinary general meeting and to vote at the extraordinary general meeting and any adjournments or postponements of the extraordinary general meeting.
Pursuant to the LCAA Articles, an LCAA Public Shareholder may request that LCAA redeem all or a portion of such LCAA Public Shares for cash in connection with the completion of the Business Combination. Holders of Units must elect to separate the Units into the underlying LCAA Public Shares and LCAA Public Warrants prior to exercising redemption rights with respect to the LCAA Public Shares. If holders hold their Units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the Units into the underlying LCAA Public Shares and LCAA Public Warrants, or if a holder holds Units registered in its own name, the holder must contact Continental directly and instruct it to do so. The redemption rights include the requirement that a beneficial holder must identify itself in writing as a beneficial holder and provide its legal name, phone number and address to Continental in order to validly redeem its shares. LCAA Public Shareholders are not required to affirmatively vote for or against the Business Combination Proposal, to vote on the Business Combination Proposal at all, or to be holders of record on the record date in order to have their LCAA Public Shares redeemed. If the Business Combination is not consummated, the LCAA Public Shares will not be redeemed and will instead be returned to the respective holder, broker or bank. In such case, LCAA shareholders may only share in the assets of the Trust Account upon the liquidation of LCAA. This may result in LCAA shareholders receiving less than they would have received if the Business Combination was completed and they had exercised redemption rights in connection therewith due to potential claims of creditors. If the Business Combination is consummated, and if an LCAA Public Shareholder properly exercises its right to redeem all or a portion of the LCAA Public Shares that it holds, LCAA will redeem such LCAA Public Shares for a per-share price, payable in cash, equal to the pro rata portion of the amount on deposit in the Trust Account calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the funds held in the Trust Account and not previously released to LCAA to pay income taxes. For illustrative purposes, as of            , 2023, the record date, this would have amounted to US$     per issued and outstanding LCAA Public Share. If an LCAA Public Shareholder exercises its redemption rights in full, then it will be electing to exchange its LCAA Public Shares for cash and will no longer own LCAA Public Shares (but will continue to own any LCAA Public Warrants it may hold). See “Extraordinary General Meeting of LCAA Shareholders — Redemption Rights” in the accompanying proxy statement/prospectus for a detailed description of the procedures to be followed if you wish to redeem your LCAA Public Shares for cash.
Notwithstanding the foregoing, an LCAA Public Shareholder, together with any affiliate of such LCAA Public Shareholder or any other person with whom such LCAA Public Shareholder is acting in concert or as a “group” ​(as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (“Exchange Act”)), will be restricted from seeking redemption rights with respect to more than an aggregate of 15% of the LCAA Public Shares. Accordingly, if an LCAA Public Shareholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the LCAA Public Shares, then any such shares in excess of that 15% limit would not be redeemed for cash.
The Sponsor has agreed to, among other things, vote all of their LCAA Shares in favor of the proposals being presented at the extraordinary general meeting in connection with the Business Combination and waive
 

 
their redemption rights with respect to their LCAA Shares in connection with the consummation of the Business Combination.
The Merger Agreement is subject to the satisfaction or waiver of certain other closing conditions as described in the accompanying proxy statement/prospectus. There can be no assurance that the parties to the Merger Agreement would waive any such closing condition.
LCAA is providing the accompanying proxy statement/prospectus and accompanying proxy card to LCAA shareholders in connection with the solicitation of proxies to be voted at the extraordinary general meeting and at any adjournments or postponements of the extraordinary general meeting. Information about the extraordinary general meeting, the Business Combination and other related business to be considered by LCAA shareholders at the extraordinary general meeting is included in the accompanying proxy statement/prospectus. Whether or not you plan to attend the extraordinary general meeting, all of LCAA shareholders should read the accompanying proxy statement/prospectus, including the Annexes and other documents referred to therein, carefully and in their entirety. You should also carefully consider the risk factors described in “Risk Factors” beginning on page 80 of the accompanying proxy statement/prospectus.
After careful consideration, the LCAA’s board of directors (“LCAA Board”) has unanimously approved the Business Combination and determined that the NTA Proposal, the Business Combination Proposal, the Merger Proposal and the Adjournment Proposal are advisable and fair to and in the best interest of LCAA and unanimously recommends that you vote or give instruction to vote “FOR” the NTA Proposal, “FOR” the Business Combination Proposal, “FOR” the Merger Proposal and “FOR” the Adjournment Proposal, if presented. When you consider LCAA Board’s recommendation of these proposals, you should keep in mind that our directors and our officers have interests in the Business Combination that may conflict with, or are different from, your interests as a shareholder of LCAA. See “Proposal Two — The Business Combination Proposal — Interests of LCAA’s Directors and Officers in the Business Combination” in the accompanying proxy statement/prospectus for a further discussion of these considerations.
The approval of the NTA Proposal will require a special resolution under Cayman Islands law and the LCAA Articles, being the affirmative vote of at least two thirds of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the extraordinary general meeting. The approval of the Business Combination Proposal will require an ordinary resolution under Cayman Islands law and the LCAA Articles, being the affirmative vote of a majority of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the extraordinary general meeting. The approval of the Merger Proposal will require a special resolution under Cayman Islands law and the LCAA Articles, being the affirmative vote of two thirds of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the extraordinary general meeting. The approval of the Adjournment Proposal, if presented, will require an ordinary resolution under Cayman Islands law and the LCAA Articles, being the affirmative vote of a majority of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the extraordinary general meeting. Brokers are not entitled to vote on the NTA Proposal, the Business Combination Proposal, the Merger Proposal or the Adjournment Proposal absent voting instructions from the beneficial holder. An abstention or broker non-vote will be counted towards the quorum requirement but will not count as a vote cast at the extraordinary general meeting.
Your vote is important regardless of the number of LCAA Shares you own. Whether or not you plan to attend the extraordinary general meeting, please complete, sign, date and return the enclosed proxy card as soon as possible in the pre-addressed postage paid envelope provided and in any event so as to be received by LCAA no later than at            AM            time, on            , 2023, being 48 hours before the time appointed for the holding of the extraordinary general meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting) to make sure that your LCAA Shares are represented at the extraordinary general meeting. If your LCAA Shares are held in “street name” or are in a margin or similar account, you should contact your broker, bank or nominee to ensure that votes related to the LCAA Shares you beneficially own are properly counted.
If you sign, date and return your proxy card without indicating how you wish to vote, your proxy will be voted FOR each of the proposals presented at the extraordinary general meeting. If you are a shareholder of record and fail to return your proxy card and do not attend the extraordinary general meeting in person (including virtually), or if you fail to instruct your bank, broker or other nominee how to vote the LCAA
 

 
Shares you beneficially own, the effect will be, among other things, that your LCAA Shares will not be counted for purposes of determining whether a quorum is present at the extraordinary general meeting and will not be voted.
TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST DEMAND IN WRITING THAT LCAA REDEEM YOUR LCAA PUBLIC SHARES FOR A PRO RATA PORTION OF THE FUNDS HELD IN THE TRUST ACCOUNT AND EITHER TENDER YOUR SHARE CERTIFICATES (IF ANY) TO CONTINENTAL STOCK TRANSFER & TRUST COMPANY, LCAA’S TRANSFER AGENT OR DELIVER YOUR LCAA PUBLIC SHARES TO THE TRANSFER AGENT ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT WITHDRAWAL AT CUSTODIAN) SYSTEM, IN EACH CASE AT LEAST TWO BUSINESS DAYS PRIOR TO THE VOTE AT THE EXTRAORDINARY GENERAL MEETING. ANY HOLDER THAT HOLDS LCAA PUBLIC SHARES BENEFICIALLY THROUGH A NOMINEE MUST IDENTIFY ITSELF AS A BENEFICIAL HOLDER AND PROVIDE ITS LEGAL NAME, PHONE NUMBER AND ADDRESS IN ITS WRITTEN DEMAND IN ORDER TO VALIDLY REDEEM SUCH SHARES. IF THE BUSINESS COMBINATION IS NOT COMPLETED, THEN THESE SHARES SHALL BE RETURNED TO YOU OR YOUR ACCOUNT. IF YOU HOLD YOUR LCAA PUBLIC SHARES IN “STREET NAME”, YOU NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BROKER, BANK OR OTHER NOMINEE TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. SEE “EXTRAORDINARY GENERAL MEETING OF LCAA SHAREHOLDERS — REDEMPTION RIGHTS” FOR MORE SPECIFIC INSTRUCTIONS.
If you have any questions or need assistance voting your LCAA Shares, please contact Morrow Sodali LLC, our proxy solicitor, by calling (800) 662-5200, or banks and brokers can call collect at (203) 658-9400, or by emailing LCAA.info@investor.morrowsodali.com.
On behalf of LCAA Board, I would like to thank you for your support and look forward to the successful completion of the Business Combination.
Sincerely,
Chinta Bhagat
Co-Chief Executive Officer and Director
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT/PROSPECTUS, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THE ACCOMPANYING PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.
The accompanying proxy statement/prospectus is dated            , 2023, and is first being mailed to shareholders of LCAA on or about            , 2023.
 

 
Notice of Extraordinary General Meeting of Shareholders
of L Catterton Asia Acquisition Corp
To Be Held on                 , 2023
TO THE SHAREHOLDERS OF L CATTERTON ASIA ACQUISITION CORP:
NOTICE IS HEREBY GIVEN that an extraordinary general meeting of shareholders of L Catterton Asia Acquisition Corp (“LCAA”), a Cayman Islands exempted company, will be held at          AM            time, on                , 2023 at                 and virtually over the Internet by means of a live audio webcast at https://                 (the “extraordinary general meeting”). We encourage shareholders to attend the extraordinary general meeting virtually via the live webcast. You are cordially invited to attend and participate in the extraordinary general meeting online by visiting https://               . The extraordinary general meeting will be held for the following purposes:
1.   Proposal No. 1 — The NTA Proposal — to consider and vote upon, as a special resolution, a proposal (the “NTA Proposal”) to approve and adopt the amendment to the second amended and restated memorandum and articles of association of LCAA (the “LCAA Articles”) set forth in Annex D of this proxy statement/prospectus, which amendment (the “NTA Amendment”) shall become effective immediately prior to the consummation of the proposed Business Combination, to remove from the LCAA Articles the prohibition on redemptions of LCAA Public Shares in an amount that would cause LCAA’s net tangible assets (“NTA”) to be less than $5,000,001 in connection with any vote held to approve a proposed business combination. The NTA Proposal is conditioned upon the approval of the Business Combination Proposal. Therefore, if the Business Combination Proposal is not approved, then the NTA Proposal will have no effect, even if approved by LCAA shareholders. A copy of the NTA Amendment to the LCAA Articles is attached to this proxy statement/prospectus as Annex D;
2.   Proposal No. 2 — The Business Combination Proposal — to consider and vote upon, as an ordinary resolution, a proposal (the “Business Combination Proposal”) to approve and authorize the Agreement and Plan of Merger, dated as of January 31, 2023 (as amended and restated by the First Amended and Restated Agreement and Plan of Merger, dated as of October 11, 2023, the “Merger Agreement”), by and among LCAA, Lotus Technology Inc., an exempted company limited by shares incorporated under the laws of the Cayman Islands (the “Company” or “LTC”), Lotus Temp Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a wholly-owned subsidiary of LTC (“Merger Sub 1”), and Lotus EV Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a wholly-owned subsidiary of LTC (“Merger Sub 2”), a copy of which is attached to this proxy statement/prospectus as Annex A, and the transactions contemplated therein, including the business combination whereby Merger Sub 1 will merge with and into LCAA (the “First Merger”), with LCAA surviving the First Merger as a wholly-owned subsidiary of LTC (such company, as the surviving entity of the First Merger, “Surviving Entity 1”), and immediately following the consummation of the First Merger, Surviving Entity 1 will merge with and into Merger Sub 2 (the “Second Merger,” and together with the First Merger, collectively, the “Mergers”), with Merger Sub 2 surviving the Second Merger as a wholly-owned subsidiary of LTC (the transactions contemplated by the Merger Agreement, including the Mergers, collectively, the “Business Combination”);
3.   Proposal No. 3 — The Merger Proposal — to consider and vote upon, as a special resolution, a proposal (the “Merger Proposal”) to approve and authorize the First Merger and the First Plan of Merger, substantially in the form attached as Exhibit F to the Merger Agreement (the “First Plan of Merger”); and
4.   Proposal No. 4 — The Adjournment Proposal — to consider and vote upon, as an ordinary resolution, a proposal (the “Adjournment Proposal”) to adjourn the extraordinary general meeting to a later date or dates to be determined by the chairman of the extraordinary general meeting, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the extraordinary general meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote or if holders of LCAA Public Shares, have elected to redeem an amount of LCAA Public Shares such that the minimum available cash condition or the net tangible assets condition contained in the Merger Agreement would not be satisfied.
 

 
We also will transact any other business as may properly come before the extraordinary general meeting or any adjournment or postponement thereof.
The full text of the resolutions to be voted on at the extraordinary general meeting is as follows:
Resolution No. 1 — The NTA Proposal
“RESOLVED, as a special resolution, that the amendment to the second amended and restated memorandum and articles of association of LCAA (the “LCAA Articles”) set forth in Annex D of this proxy statement/prospectus, which amendment (the “NTA Amendment”) shall become effective immediately prior to the consummation of the proposed Business Combination, to remove from the LCAA Articles the prohibition on redemptions of LCAA Public Shares in an amount that would cause LCAA’s net tangible assets (“NTA”) to be less than $5,000,001 in connection with any vote held to approve a proposed business combination, be and is hereby approved and adopted with effect from the time immediately prior to the consummation of the proposed Business Combination.”
Resolution No. 2 — The Business Combination Proposal
RESOLVED, as an ordinary resolution, that LCAA’s entry into the Agreement and Plan of Merger, dated as of January 31, 2023 (as amended and restated by the First Amended and Restated Agreement and Plan of Merger, dated as of October 11, 2023, the “Merger Agreement”), by and among LCAA, Lotus Technology Inc., an exempted company limited by shares incorporated under the laws of the Cayman Islands (the “Company” or “LTC”), Lotus Temp Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a wholly-owned subsidiary of LTC (“Merger Sub 1”), and Lotus EV Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a wholly-owned subsidiary of LTC (“Merger Sub 2”), a copy of which is attached to this proxy statement/prospectus as Annex A, and the transactions contemplated therein, including the business combination whereby Merger Sub 1 will merge with and into LCAA (the “First Merger”), with LCAA surviving the First Merger as a wholly-owned subsidiary of LTC (such company, as the surviving entity of the First Merger, “Surviving Entity 1”), and immediately following the consummation of the First Merger, Surviving Entity 1 will merge with and into Merger Sub 2 (the “Second Merger,” and together with the First Merger, collectively, the “Mergers”), with Merger Sub 2 surviving the Second Merger as a wholly-owned subsidiary of LTC (the transactions contemplated by the Merger Agreement, including the Mergers, collectively, the “Business Combination”) be and are hereby authorized, approved, ratified and confirmed in all respects.”
Resolution No. 3 — The Merger Proposal
RESOLVED, as a special resolution, that the First Merger and the First Plan of Merger, substantially in the form attached as Exhibit F to the Merger Agreement (the “First Plan of Merger”) be and are hereby authorized, approved and confirmed in all respects.”
Resolution No. 4 — The Adjournment Proposal
RESOLVED, as an ordinary resolution, that the adjournment of the extraordinary general meeting to a later date or dates to be determined by the chairman of the extraordinary general meeting, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more proposals at the extraordinary general meeting or if holders of LCAA Public Shares, have elected to redeem an amount of LCAA Public Shares such that the minimum available cash condition or the net tangible assets condition contained in the Merger Agreement would not be satisfied, be and is hereby approved.”
The items of business listed above are more fully described elsewhere in the proxy statement/prospectus. Whether or not you intend to attend the extraordinary general meeting, we urge you to read the proxy statement/prospectus in its entirety, including the annexes and accompanying financial statements, before voting. IN PARTICULAR, WE URGE YOU TO CAREFULLY READ THE SECTION IN THE PROXY STATEMENT/PROSPECTUS ENTITLED “RISK FACTORS.”
Only holders of record of LCAA Shares at the close of business on           , 2023 (the “record date”) are entitled to notice of the extraordinary general meeting and to vote and have their votes counted at the extraordinary general meeting and any adjournments or postponements of the extraordinary general meeting.
 

 
After careful consideration, LCAA Board has determined that each of the proposals listed is fair to and in the best interests of LCAA and its shareholders and unanimously recommends that you vote or give instruction to vote “FOR” each of the proposals set forth above. When you consider the recommendations of LCAA Board, you should keep in mind that LCAA’s directors and officers may have interests in the Business Combination that conflict with, or are different from, your interests as a shareholder of LCAA. See the section in the proxy statement/prospectus entitled “Proposal Two — The Business Combination Proposal.”
The NTA Proposal is conditioned upon the approval of the Business Combination Proposal. The closing of the Business Combination is conditioned on approval of the Business Combination Proposal and the Merger Proposal. If either of these proposals is not approved, then LCAA will not consummate the Business Combination. The Adjournment Proposal is not conditioned on the approval of any other proposal listed above.
All LCAA shareholders at the close of business on the record date are cordially invited to attend the extraordinary general meeting, which will be held at               and virtually over the Internet by means of a live audio webcast at https://                 . To ensure your representation at the extraordinary general meeting, however, you are urged to complete, sign, date and return the enclosed proxy card as soon as possible in the postage-paid return envelope provided and, in any event so as to be received by LCAA no later than at           AM      time, on                 , 2023, being 48 hours before the time appointed for the holding of the extraordinary general meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting). In the case of joint shareholders, where more than one of the joint shareholder purports to appoint a proxy, only the appointment submitted by the most senior holder (being the first named holder in respect of the shares in LCAA’s register of members) will be accepted. If you are a holder of record of LCAA Shares at the close of business on the record date, you may also cast your vote at the extraordinary general meeting. If you hold your LCAA Shares in “street name,” which means your shares are held of record by a broker, bank or nominee, you must instruct your broker or bank on how to vote the shares you beneficially own or, if you wish to attend and vote at the extraordinary general meeting, you must obtain a legal proxy from the shareholder of record and email a copy (a legible photograph is sufficient) of your proxy to proxy@continentalstock.com no later than 72 hours prior to the extraordinary general meeting. Holders should contact their broker, bank or nominee for instructions regarding obtaining a legal proxy. Holders who email a valid legal proxy will be issued a meeting control number that will allow them to register to attend and participate in the extraordinary general meeting virtually. You will receive an email prior to the meeting with a link and instructions for entering the extraordinary general meeting.
A complete list of LCAA shareholders of record entitled to vote at the extraordinary general meeting will be available for ten days before the extraordinary general meeting at the principal executive offices of LCAA for inspection by shareholders during business hours for any purpose germane to the extraordinary general meeting.
Voting on all resolutions at the extraordinary general meeting will be conducted by way of a poll rather than on a show of hands. On a poll, votes are counted according to the number of LCAA Shares registered in each shareholder’s name which are voted, with each LCAA Share carrying one vote.
Your vote is important regardless of the number of shares you own. Whether you plan to attend the extraordinary general meeting, please complete, sign, date and return the enclosed proxy card as soon as possible in the envelope provided. Submitting a proxy now will NOT prevent you from being able to attend and vote in person at the extraordinary general meeting. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly voted and counted.
If you have any questions or need assistance voting your LCAA Shares, please contact Morrow Sodali LLC, our proxy solicitor, by calling (800) 662-5200, or banks and brokers can call collect at (203) 658-9400, or by emailing LCAA.info@investor.morrowsodali.com. This notice of extraordinary general meeting is and the proxy statement/prospectus relating to the Business Combination will be available at https://               .
 

 
Thank you for your participation. We look forward to your continued support.
By Order of the Board of Directors
Chinta Bhagat
Chairman of the Board of Directors
                , 2023
IF YOU RETURN YOUR SIGNED PROXY CARD WITHOUT AN INDICATION OF HOW YOU WISH TO VOTE, YOUR SHARES WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS.
ALL HOLDERS OF LCAA PUBLIC SHARES HAVE THE RIGHT TO HAVE THEIR PUBLIC SHARES REDEEMED FOR CASH IN CONNECTION WITH THE PROPOSED BUSINESS COMBINATION. LCAA PUBLIC SHAREHOLDERS ARE NOT REQUIRED TO AFFIRMATIVELY VOTE FOR OR AGAINST THE BUSINESS COMBINATION PROPOSAL, TO VOTE ON THE BUSINESS COMBINATION PROPOSAL AT ALL, OR TO BE HOLDERS OF RECORD ON THE RECORD DATE IN ORDER TO HAVE THEIR LCAA PUBLIC SHARES REDEEMED FOR CASH.
THIS MEANS THAT ANY LCAA PUBLIC SHAREHOLDER HOLDING LCAA PUBLIC SHARES MAY EXERCISE REDEMPTION RIGHTS REGARDLESS OF WHETHER THEY ARE EVEN ENTITLED TO VOTE ON THE BUSINESS COMBINATION PROPOSAL.
TO EXERCISE REDEMPTION RIGHTS, LCAA PUBLIC SHAREHOLDERS MUST DEMAND THAT LCAA REDEEM THEIR LCAA PUBLIC SHARES AND EITHER TENDER THEIR SHARE CERTIFICATES (IF ANY) TO CONTINENTAL STOCK TRANSFER & TRUST COMPANY, LCAA’S TRANSFER AGENT, OR DELIVER THEIR LCAA PUBLIC SHARES TO THE TRANSFER AGENT ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DEPOSIT/WITHDRAWAL AT CUSTODIAN (DWAC) SYSTEM, IN EACH CASE NO LATER THAN TWO (2) BUSINESS DAYS PRIOR TO THE EXTRAORDINARY GENERAL MEETING. IF THE BUSINESS COMBINATION IS NOT COMPLETED, THEN THESE SHARES WILL NOT BE REDEEMED FOR CASH AND WILL BE RETURNED TO YOU OR YOUR ACCOUNT. IF YOU HOLD THE SHARES IN STREET NAME, YOU WILL NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BANK OR BROKER TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. ANY HOLDER THAT HOLDS LCAA PUBLIC SHARES BENEFICIALLY THROUGH A NOMINEE MUST IDENTIFY ITSELF BY LEGAL NAME, PHONE NUMBER AND ADDRESS TO LCAA IN CONNECTION WITH ANY REDEMPTION ELECTION IN ORDER TO VALIDLY REDEEM SUCH LCAA PUBLIC SHARES. SEE “EXTRAORDINARY GENERAL MEETING OF LCAA SHAREHOLDERS — REDEMPTION RIGHTS” FOR MORE SPECIFIC INSTRUCTIONS.
 

 
TABLE OF CONTENTS
PAGES
1
2
3
4
5
11
31
55
72
74
76
78
80
157
165
180
185
187
225
226
227
243
247
300
325
341
348
358
362
372
378
381
388
389
390
391
392
393
 
i

 
PAGES
394
395
396
F-1
ANNEXES
A-1
B-1
C-1
D-1
 
ii

 
ABOUT THIS PROXY STATEMENT/PROSPECTUS
This document, which forms part of a registration statement on Form F-4 filed with the U.S. Securities and Exchange Commission, or the SEC, by LTC, constitutes a prospectus of LTC under Section 5 of the U.S. Securities Act of 1933, as amended, or the Securities Act, with respect to the LTC Ordinary Shares represented by LTC ADSs to be issued to certain LCAA shareholders, the LTC ADSs to be issued to certain LTC shareholders, the LTC Warrants to be issued to holders of LCAA Warrants and the LTC Ordinary Shares represented by LTC ADSs underlying such LTC Warrants, if the Business Combination described herein is consummated. This document also constitutes a notice of meeting and a proxy statement under Section 14(a) of the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, with respect to the Extraordinary General Meeting of LCAA shareholders at which LCAA shareholders shall be asked to consider and vote upon proposals to approve the NTA Proposal, the Business Combination Proposal and the Merger Proposal (each as defined herein) and to adjourn the meeting, if necessary, to permit further solicitation of proxies because there are not sufficient votes to adopt the NTA Proposal, the Business Combination Proposal or the Merger Proposal or if holders of LCAA Public Shares, have elected to redeem an amount of LCAA Public Shares such that the Minimum Available Cash Condition or the Net Tangible Assets Condition contained in the Merger Agreement would not be satisfied.
References to “U.S. Dollars”, “USD”, “US$” and “$” in this proxy statement/prospectus are to United States dollars, the legal currency of the United States. Discrepancies in any table between totals and sums of the amounts listed are due to rounding. Certain amounts and percentages have been rounded; consequently, certain figures may add up to be more or less than the total amount and certain percentages may add up to be more or less than 100% due to rounding. In particular and without limitation, amounts expressed in millions and billions contained in this proxy statement/prospectus have been rounded to a single decimal place for the convenience of readers.
 
1

 
IMPORTANT INFORMATION ABOUT U.S. GAAP AND NON-U.S. GAAP FINANCIAL MEASURES
To evaluate the performance of its business, Lotus Tech relies on both its results of operations recorded in accordance with U.S. GAAP and certain non-U.S. GAAP financial measures, including adjusted net loss and adjusted EBITDA. These measures, as defined below, are not defined or calculated under principles, standards or rules that comprise U.S. GAAP. Accordingly, the non-U.S. GAAP financial measures Lotus Tech uses and refers to should not be viewed as a substitute for LTC’s consolidated and combined financial statements prepared and presented in accordance with U.S. GAAP or any other performance measure derived in accordance with U.S. GAAP, and you are encouraged not to rely on any single financial measure to evaluate the business, financial condition or results of operations of Lotus Tech. Lotus Tech’s definitions of adjusted net loss and adjusted EBITDA are specific to its business and you should not assume that they are comparable to similarly titled financial measures of other companies.
 
2

 
INDUSTRY AND MARKET DATA
Unless otherwise indicated, information contained in this proxy statement/prospectus concerning Lotus Tech’s industry and the regions in which it operates, including Lotus Tech’s general expectations and market position, market size, market opportunity, market share and other management estimates, is based on information obtained from industry publications and reports and forecasts provided to Lotus Tech, including an independent market research carried out by Oliver Wyman. In some cases, Lotus Tech does not expressly refer to the sources from which this information is derived. We have not commissioned any of the industry publications or other reports generated by third-party providers that we refer to in this proxy statement/prospectus. This information is subject to significant uncertainties and limitations and is based on assumptions and estimates that may prove to be inaccurate. You are therefore cautioned not to give undue weight to this information.
While Lotus Tech believes that the market data, industry forecasts and similar information included in this proxy statement/prospectus are generally reliable, such information is inherently imprecise. We are responsible for the industry and market data contained in this proxy statement/prospectus. In addition, assumptions and estimates of Lotus Tech’s future performance and growth objectives and the future performance of its industry and the markets in which it operates are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those discussed under the headings “Risk Factors,” “Cautionary Statement Regarding Forward-Looking Statements,” and “Lotus Tech’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this proxy statement/prospectus.
 
3

 
TRADEMARKS, TRADE NAMES AND SERVICE MARKS
Lotus Tech owns or has proprietary rights to trademarks used in this proxy statement/prospectus that are important to its business, many of which are registered under applicable intellectual property laws. This proxy statement/prospectus also contains trademarks, trade names and service marks of other companies, which are the property of their respective owners. Solely for convenience, trademarks, trade names and service marks referred to in this proxy statement/prospectus may appear without the ®, ™ or SM symbols, but such references are not intended to indicate, in any way, that Lotus Tech or the applicable owner or licensor will not assert, to the fullest extent permitted under applicable law, its rights or the right to these trademarks, trade names and service marks. Lotus Tech does not intend its use or display of other parties’ trademarks, trade names or service marks to imply, and such use or display should not be construed to imply, a relationship with, or endorsement or sponsorship of Lotus Tech by, any other parties.
 
4

 
FREQUENTLY USED TERMS AND BASIS OF PRESENTATION
“ADAS” means advanced driver-assistance system;
“Amended LTC Articles” means the sixth amended and restated memorandum and articles of association of LTC, which shall be adopted and become effective immediately prior to the First Effective Time;
“BEV” means battery electric vehicle;
“Business Combination” means all transactions contemplated by the Merger Agreement, including the Mergers;
“Capital Restructuring” means, collectively, the adoption of the Amended LTC Articles, the Preferred Share Conversion, the Re-designation and the Recapitalization;
“Cayman Islands Companies Act” means the Companies Act (As Revised) of the Cayman Islands;
“China” or “PRC” means the People’s Republic of China;
“Closing” means the closing of the Business Combination contemplated by the Merger Agreement;
“Closing Date” means the day on which the Closing occurs;
“Continental” means Continental Stock Transfer & Trust Company;
“Dissenting LCAA Shareholders” means LCAA shareholders who shall have validly exercised their dissenter’s rights for their LCAA Shares in accordance with Section 238 of the Cayman Islands Companies Act and otherwise complied with all of the provisions of the Cayman Islands Companies Act relevant to the exercise and perfection of Dissent Rights, and “Dissenting LCAA Shares” means the LCAA Shares held by Dissenting LCAA Shareholders;
“Dissent Rights” means the right of each holder of record of LCAA Shares to dissent in respect of the First Merger pursuant to Section 238 of the Cayman Islands Companies Act;
“Distribution Agreement” means the distribution agreement entered into by LTIL and Lotus Cars Limited on January 31, 2023 and concurrently with the execution of the Original Merger Agreement;
“D-segment” means passenger vehicles in the “large cars” category of the EU classification of vehicle types;
“Etika” means Etika Automotive Sdn Bhd;
“Exchange Act” means the Securities Exchange Act of 1934, as amended;
“Extraordinary General Meeting” means an extraordinary general meeting of shareholders of LCAA to be held at     AM/PM        time, on           , 2023 at            and virtually over the Internet via live audio webcast at https://                 ;
“EU” means the European Union;
“Euro,” “EUR,” or “€” means the legal currency of the member states participating in the European Monetary Union;
“E-segment” means passenger vehicles in the “executive cars” category of the EU classification of vehicle types;
“First Effective Time” means the effective time of the First Merger;
“First Merger” means the merger between Merger Sub 1 and LCAA, with LCAA surviving as a wholly-owned subsidiary of LTC in accordance with the Merger Agreement;
“Founder Shareholders” means collectively, the Sponsor, and LCAA’s independent directors (Mr. Sanford Martin Litvack, Mr. Frank N. Newman and Mr. Anish Melwani);
 
5

 
“Fully-Diluted Company Shares” means, without duplication, (a) the aggregate number of shares of LTC (i) that are issued and outstanding immediately prior to the Recapitalization and (ii) that are issuable (A) upon the exercise of all LTC Options (calculated using the treasury stock method of accounting), and (B) upon the exercise, exchange or conversion of any other equity securities of LTC, in each case of clauses (A) and (B), that are issued and outstanding immediately prior to the Recapitalization (whether or not then vested or exercisable as applicable) minus (b) the shares of LTC held by LTC or any of its subsidiaries (if applicable) as treasury shares; provided that, notwithstanding anything to the contrary in the foregoing, “Fully-Diluted Company Shares” shall not include any shares of LTC issuable upon the exercise, exchange or conversion of certain equity securities described in LTC’s disclosure letter to the Merger Agreement or any shares of LTC issuable upon the conversion, exchange or exercise of any equity securities of LTC issued in connection with any Pre-Closing Financing that are convertible into or exchangeable or exercisable for the shares of LTC;
“GBP” and “British pounds” means the legal currency of the United Kingdom;
“Geely Holding” means Zhejiang Geely Holding Group and its affiliates;
“ICE” means Internal Combustion Engine;
“IPO” means LCAA’s initial public offering, which was consummated on March 15, 2021;
“LCAA” means L Catterton Asia Acquisition Corp, a Cayman Islands exempted company;
“LCAA Articles” means LCAA’s second amended and restated memorandum and articles of association adopted by special resolution dated March 10, 2023, as may be amended from time to time;
“LCAA Board” means the board of directors of LCAA;
“LCAA Class A Ordinary Shares” or “LCAA Public Shares” means the Class A ordinary shares of LCAA, par value $0.0001 per share;
“LCAA Class B Conversion” means the automatic conversion of each LCAA Class B Ordinary Shares into one LCAA Class A Ordinary Shares immediately prior to the First Effective Time, in accordance with the terms of the LCAA Articles;
“LCAA Class B Ordinary Share” or “Founder Shares” means the Class B ordinary shares, par value $0.0001 per share, of LCAA;
“LCAA Private Warrants” means the warrants sold to the Sponsor in the private placement consummated concurrently with the IPO, each entitling its holder to purchase one LCAA Public Share at an exercise price of $11.50 per share, subject to adjustment;
“LCAA Public Shareholders” means the holders of LCAA Class A Ordinary Shares issued as part of the Units issued in the IPO;
“LCAA Public Warrants” means the redeemable warrants issued in the IPO, each entitling its holder to purchase one LCAA Public Share at an exercise price of $11.50 per share, subject to adjustment;
“LCAA Shareholder Redemption Amount” means the aggregate amount payable to LCAA shareholders exercising their redemption rights;
“LCAA Shares” means the ordinary shares of LCAA;
“LCAA Warrants” means the LCAA Public Warrants and the LCAA Private Warrants;
“Lotus” or “Lotus Group” means Lotus Tech and Lotus UK, taken as a whole;
“Lotus Tech,” “we,” “us,” “our company,” and “our” mean LTC and its subsidiaries. Unless otherwise specified, in the context of describing our business and operations in China, we are referring to the business and operations conducted by our PRC subsidiaries, and, for the periods ended prior to the Restructuring (as defined below), also the former VIE and its subsidiaries. References to the share capital, securities (including
 
6

 
shares, options, and warrants), shareholders, directors, board of directors, auditors of “LTC” are to the share capital, securities (including shares, options and warrants), shareholders, directors, board of directors, and auditors of LTC, respectively;
“Lotus UK” means Lotus Group International Limited and its subsidiaries;
“LTC” means Lotus Technology Inc., a Cayman Islands exempted company;
“LTC Articles” means the fifth amended and restated memorandum and articles of association of LTC;
“LTC Board” means the board of directors of LTC;
“LTC Options” means the options exercisable to purchase shares of LTC;
“LTC Ordinary Shares” means ordinary shares of LTC, par value US$0.00001 per share;
“LTC Warrants” means the warrants to purchase one LTC Ordinary Share at a price of US$11.50 per share, subject to adjustment;
“LTIL” means Lotus Technology Innovative Limited, a wholly-owned subsidiary of LTC;
“Merger Agreement” means the First Amended and Restated Agreement and Plan of Merger, dated as of October 11, 2023, by and among LCAA, LTC, Merger Sub 1 and Merger Sub 2, as may be amended, supplemented or otherwise modified from time to time, and attached hereto as Annex A, which amended and restated the Original Merger Agreement;
“Merger Sub 1” means Lotus Temp Limited, a Cayman Islands exempted company;
“Merger Sub 2” means Lotus EV Limited, a Cayman Islands exempted company;
“Mergers” means, collectively, the First Merger and the Second Merger;
“Minimum Available Cash Condition” means the condition, to which the obligations of LTC, Merger Sub 1 and Merger Sub 2 to consummate, or cause to be consummated, the Transactions to occur at the Closing are subject under the Merger Agreement, that (a) all amounts in the Trust Account as of immediately prior to the Closing (after deducting the LCAA Shareholder Redemption Amount), plus (b) cash proceeds that will be funded prior to, concurrently with, or immediately after, the Closing to LTC in connection with any PIPE Financing (as defined below), plus (c) cash proceeds that will be funded to LTC in connection with any Pre-Closing Financing, in the aggregate equaling no less than US$100,000,000, prior to payment of any unpaid or contingent liabilities, deferred underwriting fees of LCAA or transaction expenses of LTC or LCAA;
“Momenta” means Momenta (Suzhou) Technology Limited Company and/or its subsidiaries or affiliates;
“MSRP” means manufacturer’s suggested retail price;
“Nasdaq” means The Nasdaq Stock Market LLC;
“Net Tangible Assets Condition” means the condition, to which the obligations of LCAA, LTC, Merger Sub 1 and Merger Sub 2 to consummate, or cause to be consummated, the Transactions to occur at the Closing are subject under the Merger Agreement, that after giving effect to any redemption by LCAA Public Shareholders, LCAA must have net tangible assets of at least $5,000,001 upon consummation of the Business Combination (as determined in accordance with Rule 3a5l-l(g)(1) of the Exchange Act (or any successor rule));
“OEM” means original equipment manufacturer;
“Original Merger Agreement” means the Agreement and Plan of Merger, dated as of January 31, 2023, by and among LCAA, LTC, Merger Sub 1 and Merger Sub 2;
“Preferred Share Conversion” means the conversion of each preferred share of LTC that is issued and outstanding immediately prior to the First Effective Time into one ordinary share on a one-for-one basis, by re-designation and re-classification, in accordance with the LTC Articles;
 
7

 
“Put Option Agreement” means each Put Option Agreement, dated as of January 31, 2023, entered by LTC with each of Geely and Etika, respectively;
“Recapitalization” means immediately following the Re-designation and prior to the First Effective Time, the recapitalization of each issued LTC Ordinary Share by way of a repurchase in exchange for the issuance of such number of LTC Ordinary Shares equal to the Recapitalization Factor (i.e., one such LTC Ordinary Share multiplied by the Recapitalization Factor);
“Recapitalization Factor” means the quotient obtained by dividing (i) the quotient obtained by dividing $5,500,000,000 by the Fully-Diluted Company Shares by (ii) $10.00;
“Redeeming LCAA Shares” means the LCAA Shares in respect of which the eligible holder thereof has validly exercised such holder’s redemption right;
“Re-designation” means the re-designation of 500,000,000 authorized but unissued ordinary shares of LTC as shares of a par value of US$0.00001 each of such class or classes (however designated) as the LTC Board may determine in accordance with the Amended LTC Articles immediately following the Preferred Share Conversion but immediately prior to the Recapitalization, such that the authorized share capital of LTC shall be US$50,000 divided into 5,000,000,000 shares of par value of US$0.00001 each, consisting of 4,500,000,000 LTC Ordinary Shares, and 500,000,000 shares of a par value of US$0.00001 each of such class or classes (however designated) as the LTC Board may determine in accordance with the Amended LTC Articles;
“Renminbi” or “RMB” means the legal currency of China;
“Restructuring” means a series of transactions LTC and its subsidiaries have implemented to restructure its organization and business operations since early 2023;
“Second Merger” means the merger between Surviving Entity 1 and Merger Sub 2, with Merger Sub 2 surviving as a wholly-owned subsidiary of LTC in accordance with the Merger Agreement;
“Sponsor” means LCA Acquisition Sponsor, LP, a Cayman Islands limited partnership;
“Sponsor Support Agreement” means the Sponsor Support Agreement, dated as of January 31, 2023, by and among LTC, LCAA, and the Founder Shareholders, as amended by the Amendment to Sponsor Support Agreement, dated as of November 13, 2023 and as further amended, supplemented or otherwise modified from time to time;
“Surviving Entity 1” means the surviving entity of the First Merger;
“Surviving Entity 2” means the surviving entity of the Second Merger;
“Trust Account” means the trust account established for the purpose of holding the net proceeds of LCAA’s IPO;
“Unit” means each unit issued by LCAA in its IPO or the exercise of the underwriter’s overallotment option, consisting of one LCAA Class A Ordinary Share and one-third of LCAA Warrant;
“Unit Separation” means the automatic detachment of each LCAA Unit outstanding immediately prior to the First Effective Time at the First Effective Time, as a result of which the holder thereof shall be deemed to hold one LCAA Class A Ordinary Share and one-third of an LCAA Warrant in accordance with the terms of the applicable Unit;
“U.K.” means the United Kingdom;
“U.S.” means the United States of America;
“US$,” “U.S. dollars” or “dollars” means the legal currency of the United States;
“U.S. GAAP” means accounting principles generally accepted in the United States of America;
“VIE” means Wuhan Lotus E-commerce Co., Ltd., the former variable interest entity of LTC prior to the Restructuring;
 
8

 
“Warrant Agreement” means the Warrant Agreement dated as of March 10, 2021, between L Catterton Asia Acquisition Corp and Continental Stock Transfer & Trust Company; and
“WFOE” means Wuhan Lotus Technology Limited Company, LTC’s wholly-owned PRC subsidiary.
Unless otherwise specified, the voting and economic interests of the combined company’s shareholders set forth in this proxy statement/prospectus assume the following:

LTC is valued at US$5,500,000,000 on a pre-money equity value basis (before taking into account the values of LTC Ordinary Shares issued to merger financing investors or the Jingkai Fund pursuant to the second bullet point below).

Hubei Changjiang Jingkai Automobile Industry Investment Fund Partnership (Limited Partner), (the “Jingkai Fund”), a local government fund in Wuhan, China, invests in LTC in an amount equal to RMB 2,600,000,000 at US$10.00 per share (calculated using an exchange rate of 1 U.S. dollar = 7.2258 RMB) during the Interim Period (as defined below), pursuant to which a total of 35,982,175 LTC Ordinary Shares are issued to the Jingkai Fund substantially concurrently with the Closing.

The applicable conditions specified in the Sponsor Support Agreement relating to the earn-out of certain Sponsor Shares are satisfied immediately following the Closing, and as a result, all Sponsor Shares subject to earn-out are vested and no longer subject to any earn-out arrangement immediately following the Closing.

No Sponsor Shares are transferred by the Sponsor as consideration to induce LCAA shareholders to waive its redemption rights.

The Founder Shareholders and holders of any equity securities of LTC do not purchase any LCAA Public Shares in the open market.

No LCAA Public Shareholder exercises appraisal rights pursuant to the Cayman Islands Companies Act.

No LCAA Public Share or Founder Share is held in LCAA’s treasury or owned by LTC, Merger Sub 1 or Merger Sub 2, or any other wholly-owned subsidiary of LTC.

There are no other issuances of equity interests of LTC or LCAA not described in this proxy statement/prospectus.
In addition, unless otherwise specified, the voting and economic interests of the combined company’s shareholders set forth in this proxy statement/prospectus do not take into account (i) the LCAA Public Warrants or the LCAA Private Warrants, which will convert into LTC Warrants at the Closing, and which will remain outstanding following the Business Combination, so may be exercised at a later date, or (ii) the 7,302,414 LTC Ordinary Shares which will be issuable upon any exercise of LTC Options issued and outstanding as of June 30, 2023, calculated after taking into account the Recapitalization and using the treasury stock method of accounting. The LCAA Public Warrants represent 9,550,291 redeemable warrants issued in the IPO, each entitling its holder to purchase one LCAA Public Share at an exercise price of US$11.50 per share, subject to adjustment. The LCAA Private Warrants represent 5,486,784 warrants sold to Sponsor in the private placement consummated concurrently with the IPO, each entitling its holder to purchase one LCAA Public Share at an exercise price of US$11.50 per share, subject to adjustment. In connection with the Business Combination, LCAA Public Warrants and LCAA Private Warrants will be automatically and irrevocably assumed by LTC and converted into warrants of LTC each entitling its holder to purchase one LTC Ordinary Share in the form of LTC ADS at a price of US$11.50 per share, subject to adjustment.
Certain sections in this proxy statement/prospectus refer to a “no redemption” scenario, a “25% redemption” scenario, a “50% redemption” scenario, a “75% redemption” scenario, or a “maximum redemption” scenario. Unless otherwise specified, these scenarios take into account the redemptions in connection with the Extension EGM (as defined below), and assume for illustrative purposes that all of the assumption described above apply, except for the following:

In respect of the no redemption scenario, no LCAA Public Share is redeemed by the LCAA Public Shareholders.
 
9

 

In respect of the 25% redemption scenario, 5,445,906 LCAA Public Share are redeemed by the LCAA Public Shareholders.

In respect of the 50% redemption scenario, 10,891,811 LCAA Public Share are redeemed by the LCAA Public Shareholders.

In respect of the 75% redemption scenario, 16,337,717 LCAA Public Share are redeemed by the LCAA Public Shareholders.

In respect of the maximum redemption scenario, 21,783,622 LCAA Public Share are redeemed by the LCAA Public Shareholders. The maximum redemption scenario assumes for illustrative purposes that there will be no funds left in the Trust Account assuming all LCAA Public Shareholders exercise their redemption rights with respect to the LCAA Public Shares.
 
10

 
QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION AND THE EXTRAORDINARY GENERAL MEETING
The questions and answers below highlight only selected information set forth elsewhere in this proxy statement/prospectus and only briefly address some commonly asked questions about the extraordinary general meeting and the proposals to be presented at the extraordinary general meeting, including with respect to the proposed Business Combination. The following questions and answers do not include all the information that may be important to LCAA shareholders. LCAA shareholders are urged to carefully read this entire proxy statement/prospectus, including the annexes and the other documents referred to herein, to fully understand the proposed Business Combination and the voting procedures for the extraordinary general meeting.
Q:
Why am I receiving this proxy statement/prospectus?
A:
LCAA and LTC have agreed to a business combination under the terms of the Merger Agreement that is described in this proxy statement/prospectus. A copy of the Merger Agreement is attached to this proxy statement/prospectus as Annex A and LCAA encourages its shareholders to read it in its entirety. LCAA shareholders are being asked to consider and vote upon a proposal to approve the Merger Agreement and the other transactions contemplated by the Merger Agreement. See “Proposal Two — The Business Combination Proposal.”
Q:
Are there any other matters being presented to shareholders at the meeting?
A:
In addition to voting on the Business Combination Proposal, LCAA shareholders will vote on the following proposals:

To consider and vote upon, as a special resolution, a proposal (the “NTA Proposal”) to approve and adopt the amendment to the second amended and restated memorandum and articles of association of LCAA (the “LCAA Articles”) set forth in Annex D of this proxy statement/prospectus, which amendment (the “NTA Amendment”) shall become effective immediately prior to the consummation of the proposed Business Combination, to remove from the LCAA Articles the prohibition on redemptions of LCAA Public Shares in an amount that would cause LCAA’s net tangible assets (“NTA”) to be less than $5,000,001 in connection with any vote held to approve a proposed business combination. See the section of this proxy statement/ prospectus titled “Proposal One — The NTA Proposal.”

To authorize the First Merger and the First Plan of Merger. See the section of this proxy statement/prospectus titled “Proposal Three — The Merger Proposal.”

To consider and vote upon a proposal to adjourn the extraordinary general meeting to a later date or dates to be determined by the chairman of the extraordinary general meeting, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the extraordinary general meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote or if holders of LCAA Public Shares, have elected to redeem an amount of LCAA Public Shares such that the Minimum Available Cash Condition or the Net Tangible Assets Condition contained in the Merger Agreement would not be satisfied. See the section of this proxy statement/prospectus titled “Proposal Four — The Adjournment Proposal.”
LCAA will hold the extraordinary general meeting of its shareholders to consider and vote upon these proposals. This proxy statement/prospectus contains important information about the proposed Business Combination and the other matters to be acted upon at the extraordinary general meeting. Shareholders should read it carefully.
The vote of shareholders is important. Regardless of how many shares you own, you are encouraged to vote as soon as possible after carefully reviewing this proxy statement/prospectus.
Q:
Why is LCAA providing shareholders with the opportunity to vote on the Business Combination?
A:
Pursuant to the LCAA Articles, LCAA is required to provide LCAA Public Shareholders with an opportunity to have their LCAA Public Shares redeemed for cash upon the consummation of its initial
 
11

 
business combination, either in conjunction with a shareholder vote or tender offer. Due to the structure of the Business Combination, LCAA is providing this opportunity in conjunction with a shareholder vote.
Q:
What will happen to LCAA’s securities upon consummation of the Business Combination?
A:
LCAA’s securities, namely the Units (trading symbol “LCAAU”), LCAA Public Shares (trading symbol “LCAA”) and LCAA Public Warrants (trading symbol “LCAAW”), are currently listed on Nasdaq. The Units, LCAA Public Shares and LCAA Public Warrants will cease trading upon consummation of the Business Combination and will be delisted from Nasdaq and deregistered under the Exchange Act. LTC intends to apply for listing of the LTC ADSs on Nasdaq under the proposed symbol “LOT” and LTC Warrants under the proposed symbol “LOTWW,” each to be effective upon the consummation of the Business Combination. While trading on Nasdaq is expected to begin on the first business day following the consummation of the Business Combination, there can be no assurance that the LTC ADSs and LTC Warrants will be listed on Nasdaq or that a viable and active trading market will develop. See “Risk Factors” for more information.
Q:
Why is LCAA proposing the NTA Proposal?
A:
The adoption of the proposed NTA Amendment to remove the minimum net tangible asset requirement from the LCAA Articles is being proposed in order to facilitate the consummation of the Business Combination, by permitting redemptions of LCAA Public Shares even if such redemptions would result in LCAA having net tangible assets less than $5,000,001. The purpose of including the minimum net tangible asset requirement in the LCAA Articles was to ensure that the LCAA Class A Ordinary Shares are not deemed to be “penny stocks” pursuant to Rule 3a51-1 under the Exchange Act. The LCAA Class A Ordinary Shares and the LTC ADSs would not be deemed to be “penny stocks,” as such securities are or will be listed on a national securities exchange upon the Closing. Therefore, LCAA is presenting the NTA Proposal to facilitate the consummation of the Business Combination. For more information, see “Proposal One — The NTA Proposal — Reasons for the NTA Proposal.”
Q:
Why is LCAA proposing the Business Combination?
A:
LCAA was organized to effect a merger, share exchange, asset acquisition, share purchase, reorganization or other similar business combination with one or more businesses or entities.
On March 15, 2021, LCAA consummated its initial public offering (the “IPO”) of 25,000,000 Units at a price of $10.00 per Unit, generating gross proceeds to LCAA of $250,000,000. Each Unit consists of one LCAA Class A Ordinary Share and one-third of one LCAA Public Warrant. Concurrent to the closing of the initial public offering, LCAA consummated a private placement of 5,000,000 LCAA Private Warrants with the Sponsor at a price of $1.50 per LCAA Private Warrant, generating gross proceeds of $7,500,000 (the “Private Placement”). On March 24, 2021, the underwriters partially exercised their over-allotment option, according to which LCAA consummated the sale of an additional 3,650,874 Units, at $10.00 per Unit, and the sale of an additional 486,784 LCAA Private Warrants, at $1.50 per LCAA Private Warrant. Following the closing of the over-allotment option, LCAA generated total gross proceeds of $294,738,916 from the IPO and the Private Placement, of which $286,508,740 was raised in the IPO, $8,230,176 was raised in the Private Placement, and $286,508,740 was placed in a trust account established for the benefit of LCAA’s public shareholders. LCAA paid a total of $5,730,175 underwriting discounts and commissions and $709,897 for other costs and expenses related to the IPO.
On March 10, 2023, LCAA held an extraordinary general meeting of its shareholders (the “Extension EGM”), at which the LCAA shareholders approved a proposal (such proposal, the “Extension Proposal”) to amend LCAA’s Amended and Restated Memorandum and Articles of Association to extend the date by which LCAA must (a) consummate a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination, (b) cease its operations except for the purpose of winding up if it fails to complete such initial business combination and (c) redeem all of the LCAA Public Shares if it fails to complete such initial business combination, from March 15, 2023 to June 15, 2023 and to allow the LCAA Board, without another shareholder vote, to elect to further extend the date to consummate an initial business combination after June 15, 2023 up to nine times, by an additional
 
12

 
month each time, upon five days’ advance written notice prior to the applicable deadline, up to March 15, 2024 or such earlier date as determined by the Board in its sole discretion (such date by which LCAA must consummate a business combination in accordance with the LCAA Articles, as amended, the “Business Combination Deadline,” and such extension, the “Extension”).
In connection with the Extension EGM, holders of 6,867,252 LCAA Public Shares (representing 23.97% of the then outstanding LCAA Public Shares) exercised their right to redeem their shares for a pro rata portion of the funds in the Trust Account. As a result, approximately $70,200,753.82 (approximately $10.22 per LCAA Public Share) was removed from the Trust Account to pay such redeeming holders and approximately $222,683,933.01 remained in the Trust Account. Following such redemptions, there are 21,783,622 LCAA Public Shares outstanding.
On June 5, 2023, the LCAA Board approved the extension of June 15, 2023 for one additional month to July 15, 2023, authorized the establishment of the extension committee as a committee of the LCAA Board (the “Extension Committee”) and delegated the power to approve further extensions for up to eight additional one-month periods, from July 15, 2023 to March 15, 2024, to the Extension Committee, which was noticed to shareholders on June 9, 2023. In connection with the extension from June 15, 2023 to July 15, 2023, the Sponsor deposited into the trust account $330,000 on June 15, 2023. Subsequently, the Extension Committee has approved five additional one-month extensions of the Termination Date, the latest of which has extended the Termination Date to December 15, 2023. In connection with each such additional one-month extension of the Termination Date, the Sponsor or its designee or affiliate deposited (or, with respect to the latest extension of the Termination Date to December 15, 2023, expects to deposit) $330,000 within 5 business days of the beginning of each one-month extended period.
LCAA believes that LTC is a company with an appealing market opportunity and growth profile, a strong position in its industry and a compelling valuation. As a result, LCAA believes that the Business Combination will provide LCAA shareholders with an opportunity to participate in the ownership of a company with significant growth potential. See the section entitled “Proposal Two — The Business Combination Proposal.”
Q:
Did LCAA Board obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Business Combination?
A:
No. LCAA Board of directors did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the Business Combination. Accordingly, investors will be relying solely on the judgment of LCAA Board, its management team and its advisors in valuing LTC and will be assuming the risk that LCAA Board may not have properly valued the business. However, LCAA’s officers and directors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and have substantial experience with financial investments and mergers and acquisitions. Furthermore, in analyzing the Business Combination, LCAA’s management conducted significant due diligence on LTC and LCAA Board reviewed such due diligence as part of its review and approval of the Business Combination. For a complete discussion of the factors utilized by LCAA Board in approving the Business Combination, see the section of this proxy statement entitled “The Business Combination — LCAA Board of Directors’ Reasons for the Business Combination.” Based on the foregoing, LCAA Board concluded that its members’ collective experience and backgrounds, together with the experience and sector expertise of LCAA’s advisors, enabled it to make the necessary analyses and determinations regarding the Business Combination, including that the Business Combination was fair from a financial perspective to its shareholders and that LTC’s fair market value was at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on interest earned on the Trust Account) at the time the Merger Agreement was entered into with respect to the Business Combination. There can be no assurance, however, that LCAA Board was correct in its assessment of the Business Combination. For a complete discussion of the factors utilized by LCAA Board in approving the Business Combination, see the section entitled “Proposal Two — The Business Combination Proposal.”
Q:
Do I have redemption rights?
A:
If you are an LCAA Public Shareholder, you have the right to demand that LCAA redeem your LCAA
 
13

 
Public Shares for a pro rata portion of the cash held in LCAA’s Trust Account, calculated as of two business days prior to the consummation of the Business Combination in accordance with the LCAA Articles. In this proxy statement/prospectus, these rights to demand redemption of the LCAA Public Shares are sometimes referred to as “redemption rights.” Notwithstanding the foregoing, an LCAA Public Shareholder, together with any affiliate of his or any other person with whom such holder 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 more than 15% of the LCAA Public Shares. Accordingly, all LCAA Public Shares in excess of 15% held by an LCAA Public Shareholder, together with any affiliate of such holder or any other person with whom such holder is acting in concert or as a “group,” will not be redeemed and converted into cash. Additionally, the LCAA Articles contain a prohibition on redemptions of LCAA Public Shares in an amount that would cause LCAA’s net tangible assets to be less than $5,000,001 in connection with any vote held to approve a proposed business combination, which prohibition will apply in connection with the Business Combination Proposal unless the LCAA Articles are amended to remove such prohibition (whether pursuant to the NTA Amendment or otherwise).
Q:
Will how I vote on the Business Combination affect my ability to exercise my redemption rights?
A:
No. An LCAA Public Shareholder may exercise redemption rights regardless of whether he, she or it votes for or against the Business Combination Proposal or does not vote on such proposal at all, or if he, she or it is an LCAA Public Shareholder on the record date. This means that any LCAA Public Shareholder holding LCAA Public Shares may exercise redemptions rights regardless of whether they are even entitled to vote on the Business Combination Proposal.
Q:
How do I exercise my redemption rights?
A:
If you are an LCAA Public Shareholder and wish to exercise your redemption rights, you must:

submit a written request to Continental Stock Transfer & Trust Company, LCAA’s transfer agent, in which you (i) request that LCAA redeem all or a portion of your LCAA Public Shares for cash, and (ii) identify yourself as the beneficial holder of the LCAA Public Shares and provide your legal name, phone number and address; and

either tender your share certificates (if any) to Continental Stock Transfer & Trust Company, LCAA’s transfer agent, or deliver your LCAA Public Shares to the transfer agent electronically using The Depository Trust Company’s Deposit/Withdrawal at Custodian (DWAC) System.
Holders must complete the procedures for electing to redeem their LCAA Public Shares in the manner described above prior to on           , 2023, two business days prior to the extraordinary general meeting, in order for their LCAA Public Shares to be redeemed. If you hold the shares in “street name,” you will have to coordinate with your broker, bank or nominee to have the LCAA Public Shares you beneficially own certificated and delivered electronically.
Any LCAA Public Shareholder satisfying the requirements for exercising redemption rights will be entitled to a pro rata portion of the amount then in the Trust Account (which, for illustrative purposes, was US$      , or US$      per share, as of the record date) calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the funds in the Trust Account and not previously released to LCAA to pay income taxes. Such amount will be paid promptly upon consummation of the Business Combination. There are currently no owed but unpaid income taxes on the funds in the Trust Account.
There is a nominal cost associated with this tendering process and the act of certificating the shares or delivering them through the DWAC system. The transfer agent will typically charge the tendering broker US$80.00 and it would be up to the broker whether or not to pass this cost on to the redeeming shareholder. In the event the Business Combination is not consummated this may result in an additional cost to shareholders for the return of their shares.
Any request for redemption, once made by an LCAA Public Shareholder, may be withdrawn at any time up to two business days prior to the time the vote is taken with respect to the Business Combination Proposal at the extraordinary general meeting (unless otherwise agreed to by LCAA). If you tender your
 
14

 
share certificates (if any) to LCAA’s transfer agent and later decide prior to the extraordinary general meeting not to elect redemption, you may request that LCAA’s transfer agent return your share certificates (physically or electronically). You may make such request by contacting LCAA’s transfer agent at the address listed below.
No demand for redemption will be honored unless the holder’s LCAA Public Shares have been delivered (either physically or electronically) to the transfer agent in the manner described above no later than two business days prior to the extraordinary general meeting.
LCAA’s transfer agent can be contacted at the following address:
Continental Stock Transfer & Trust Company
1 State Street, 30th Floor
New York, New York 10004
Attention: Mark Zimkind
Email: spacredemption@continentalstock.com
Q:
Can I exercise redemption rights and dissenter rights under the Cayman Islands Companies Act?
A:
No. Any LCAA Public Shareholder who elects to exercise Dissent Rights (which dissenter rights are discussed in the section entitled “Do I have appraisal rights if I object to the proposed Business Combination?”) will lose their right to have their LCAA Public Shares redeemed in accordance with the LCAA Articles. The certainty provided by the redemption process may be preferable for LCAA Public Shareholders wishing to exchange their LCAA Public Shares for cash. This is because Dissent Rights may be lost or extinguished, including where LCAA and the other parties to the Merger Agreement determine to delay the consummation of the Business Combination in order to invoke the limitation on dissenter rights under Section 239 of the Cayman Islands Companies Act, in which case any LCAA Public Shareholder who has sought to exercise Dissent Rights would only be entitled to receive the merger consideration contemplated by the Merger Agreement.
Q:
If I am a holder of LCAA Units, can I exercise redemption rights with respect to my Units?
A:
No. Holders of outstanding Units must first separate the Units into the underlying LCAA Public Shares and LCAA Public Warrants prior to exercising redemption rights with respect to LCAA Public Shares. If you hold Units registered in your own name, you must deliver the certificate for such Units (if any) to Continental Stock Transfer & Trust Company, LCAA’s transfer agent, with written instructions to separate such Units into LCAA Public Shares and LCAA Public Warrants. This must be completed far enough in advance to permit the mailing of the share certificates back to you so that you may then exercise your redemption rights upon the separation of the LCAA Public Shares from the Units. If you hold the Units in “street name,” you will need to instruct your broker, bank or nominee to separate the Units you beneficially own. Your nominee must send written instructions to LCAA’s transfer agent. Such written instructions must include the number of Units to be split and the nominee holding such Units. Your nominee must also initiate electronically, using The Depository Trust Company’s Deposit/Withdrawal at Custodian (DWAC) System, a withdrawal of the relevant Units and a deposit of the number of LCAA Public Shares and LCAA Public Warrants represented by such Units. This must be completed far enough in advance to permit your nominee to exercise redemption rights upon the separation of the LCAA Public Shares from the Units. While this is typically done electronically the same business day, you should allow at least one full business day to accomplish the separation. If you fail to cause your LCAA Public Shares to be separated in a timely manner, you shall likely not be able to exercise your redemption rights.
 
15

 
Q:
If I am a holder of LCAA Warrants, can I exercise redemption rights with respect to my warrants?
A:
No. The holders of LCAA Warrants have no redemption rights with respect to such securities.
Q:
What are the U.S. federal income tax consequences to me if I exercise my redemption rights?
A:
The U.S. federal income tax consequences to U.S. Holders (as defined in the section entitled “Material Tax Considerations — U.S. Federal Income Tax Considerations to U.S. Holders”) that exercises its redemption rights are complex and depend on such holder’s particular facts and circumstances. For a discussion of the U.S. federal income tax considerations of exercising your redemption rights, see the section entitled “Material Tax Considerations — U.S. Federal Income Tax Considerations — U.S. Holders Exercising Redemption Rights with Respect to LCAA Public Shares.” If you are contemplating exercising your redemption rights, you should consult your tax advisor to determine the tax consequences thereof.
Q:
What are the U.S. federal income tax consequences of the Business Combination to me?
A:
As described in the section entitled, “Material Tax Considerations — U.S. Federal Income Tax Considerations — Effects of the Mergers — Characterization of the Mergers as a Tax-Free Reorganization under Section 368(a) of the Code,” there are significant factual and legal uncertainties as to whether the Business Combination will qualify as a reorganization within the meaning of Section 368(a) of the Code. Under Section 368(a) of the Code and Treasury Regulations promulgated thereunder, an acquiring corporation must continue, directly or indirectly through certain controlled corporations, a significant line of the acquired corporation’s historic business or use a significant portion of the acquired corporation’s historic business assets in a business. There is an absence of guidance as to how the foregoing requirement applies in the case of an acquisition of a blank check corporation with assets consisting almost entirely of investment-type assets, such as LCAA. If any requirement for Section 368(a) of the Code is not met, then a U.S. Holder of LCAA Public Shares and/or LCAA Warrants would generally recognize gain or loss in an amount equal to the difference, if any, between the fair market value of Lotus Tech Ordinary Shares and/or Lotus Tech Warrants, as applicable, received in the Business Combination, over such U.S. Holder’s aggregate tax basis in the corresponding LCAA Public Shares and/or LCAA Warrants surrendered by such U.S. Holder in the Business Combination. Even if the Business Combination otherwise qualifies as a “reorganization” within the meaning of Section 368(a) of the Code, U.S. Holders may be required to recognize gain (but not loss) on account of the application of the Passive Foreign Investment Company (“PFIC”) rules, as described in more detail below under “Material Tax Considerations — U.S. Federal Income Tax Considerations to U.S. Holders — Effects of the Mergers — PFIC Considerations of the Mergers.” You should consult your tax advisors regarding the tax consequences of the Business Combination.
Q:
Do I have appraisal rights if I object to the proposed Business Combination?
A:
Holders of record of LCAA Shares may have appraisal rights in connection with the Business Combination under the Cayman Islands Companies Act. Holders of record of LCAA Shares wishing to exercise such statutory dissenter rights and make a demand for payment of the fair value for their LCAA Shares must give written objection to the First Merger to LCAA prior to the shareholder vote to approve the First Merger and follow the procedures set out in Section 238 of the Cayman Islands Companies Act, noting that any such dissenter rights may subsequently be lost and extinguished pursuant to Section 239 of the Cayman Islands Companies Act which states that no such dissenter rights shall be available in respect of shares of any class for which an open market exists on a recognized stock exchange or recognized interdealer quotation system at the expiry date of the period allowed for written notice of an election to dissent provided that the merger consideration constitutes inter alia shares of any company which at the effective date of the merger are listed on a national securities exchange. LCAA believes that such fair value would equal the amount that LCAA shareholders would obtain if they exercised their redemption rights as described herein. An LCAA shareholder which elects to exercise appraisal rights must do so in respect of all of the LCAA Shares that person holds and will lose their right to exercise their redemption rights as described herein. See the section of this proxy statement/prospectus titled “Extraordinary General Meeting of LCAA shareholders.” LCAA shareholders are recommended to seek
 
16

 
their own advice as soon as possible on the application and procedure to be followed in respect of the appraisal rights under the Cayman Islands Companies Act.
Q:
What happens to the funds deposited in the Trust Account after consummation of the Business Combination?
A:
The net proceeds of the IPO, together with a portion of the proceeds from the sale of the LCAA Private Warrants in a private placement to the Sponsor, equal in the aggregate to US$286,508,740, was placed in the Trust Account immediately following the IPO. In connection with the Extension EGM, holders of 6,867,252 LCAA Public Shares (representing 23.97% of the then outstanding LCAA Public Shares) exercised their right to redeem their shares for a pro rata portion of the funds in the Trust Account. As a result, approximately $70,200,753.82 (approximately $10.22 per LCAA Public Share) was removed from the Trust Account to pay such redeeming holders and approximately $222,683,933.01 remained in the Trust Account. After consummation of the Business Combination, the funds in the Trust Account will be used to pay, on a pro rata basis, LCAA Public Shareholders who exercise redemption rights and to pay fees and expenses incurred in connection with the Business Combination. Any remaining cash will be used for Lotus Tech’s working capital and general corporate purposes.
Q:
What happens if a substantial number of public shareholders vote in favor of the Business Combination Proposal and exercise their redemption rights?
A:
LCAA Public Shareholders may vote in favor of the Business Combination and still exercise their redemption rights, although they are not required to vote in any way to exercise such redemption rights. Accordingly, the Business Combination may be consummated even though the funds available from the Trust Account and the number of LCAA Public Shareholders are substantially reduced as a result of redemptions by LCAA Public Shareholders.
If an LCAA Public Shareholder exercises his, her or its redemption rights, such exercise will not result in the loss of any warrants that such LCAA Public Shareholder may hold. As a result, any non-redeeming LCAA Public Shareholders would experience dilution to the extent such LCAA Public Warrants are exercised and additional LTC ADSs are issued.
If the NTA Proposal is approved and adopted, then under the LCAA Articles, LCAA will not be prohibited from redeeming LCAA Public Shares in an amount that would cause LCAA’s net tangible assets to be less than $5,000,001. However, to the extent that there are fewer public shares and public shareholders, the trading market for LTC ADSs may be less liquid than the market was for LCAA Public Shares prior to the Business Combination, and LTC may not be able to meet the listing standards of a national securities exchange. In addition, to the extent of any redemptions, fewer funds from the Trust Account would be available to LTC to be used in its business following the consummation of the Business Combination.
The sensitivity table below shows the potential impact of redemptions on the pro forma book value per share of the shares owned by LCAA Public Shareholders under different redemption scenarios, taking into account certain potential sources of dilution, namely, the LTC ADSs underlying the LTC Warrants (as converted from the LCAA Public Warrants and LCAA Private Warrants) and granted LTC Options. Unless otherwise specified, the share amounts and percentage ownership numbers have been determined after giving effect to redemptions in connection with the Extension EGM and have been determined under the assumptions set forth under the section titled “Frequently Used Terms and Basis of Presentation.” If actual facts are different from the assumptions set forth therein, the share amounts and percentage ownership numbers will be different.
 
17

 
Assuming No
Redemption
Assuming 25%
Redemption
Assuming 50%
Redemption
Assuming 75%
Redemption
Assuming
Maximum
Redemption
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Holders of LTC Ordinary Shares (including
LTC Ordinary Shares represented by
LTC ADSs) Not Reflecting Potential
Sources of Dilution
Existing LCAA Shareholders (excluding the Founding Shareholders)(1)
21,783,622 3.51% 16,337,716 2.66% 10,891,811 1.79% 5,445,905 0.90% 0.00%
The Founder Shareholders(2)
7,162,718 1.16% 7,162,718 1.17% 7,162,718 1.17% 7,162,718 1.19% 7,162,718 1.20%
Existing LTC Shareholders(3)
542,697,586 87.51% 542,697,586 88.29% 542,697,586 89.08% 542,697,586 89.88% 542,697,586 90.70%
Jingkai Fund(4)
35,982,175 5.80% 35,982,175 5.85% 35,982,175 5.91% 35,982,175 5.96% 35,982,175 6.01%
Momenta(5) 564,828 0.09% 564,828 0.09% 564,828 0.09% 564,828 0.09% 564,828 0.09%
Merger Financing Investors(6)
11,953,579 1.93% 11,953,579 1.94% 11,953,579 1.96% 11,953,579 1.98% 11,953,579 2.00%
Total LTC Ordinary Shares (including LTC
Ordinary Shares represented by LTC
ADSs) Outstanding at Closing
620,144,508 100.00% 614,698,602 100.00% 609,252,697 100.00% 603,806,791 100.00% 598,360,886 100.00%
Total LTC Ordinary Shares (including LTC
Ordinary Shares represented by LTC
ADSs) Outstanding at Closing Not
Reflecting Potential Sources of
Dilution
620,144,508 96.52% 614,698,602 96.49% 609,252,697 96.46% 603,806,791 96.43% 598,360,886 96.40%
Potential Sources of Dilution
Shares underlying LCAA Public Warrants
(represented by LTC ADSs)
9,550,291 1.49% 9,550,291 1.50% 9,550,291 1.51% 9,550,291 1.52% 9,550,291 1.54%
Shares underlying LCAA Private Warrants
(represented by LTC ADSs)
5,486,784 0.85% 5,486,784 0.86% 5,486,784 0.87% 5,486,784 0.88% 5,486,784 0.88%
Shares underlying Granted LTC
Options
7,302,414 1.14% 7,302,414 1.15% 7,302,414 1.16% 7,302,414 1.17% 7,302,414 1.18%
Total LTC Ordinary Shares (including LTC
Ordinary Shares represented by LTC
ADSs) Outstanding at Closing (including
LTC ADSs underlying LCAA Public
Warrants, LCAA Private Warrants and
LTC Ordinary Shares underlying granted
LTC Options)
642,483,997 100.00% 637,038,091 100.00% 631,592,186 100.00% 626,146,280 100.00% 620,700,375 100.00%
Holders of LTC Ordinary Shares Reflecting
Potential Sources of Dilution
Existing LCAA Shareholders (excluding the Founder Shareholders)(7)
31,333,913 4.88% 25,888,007 4.06% 20,442,102 3.24% 14,996,196 2.39% 9,550,291 1.54%
The Founder Shareholders(8)
12,649,502 1.97% 12,649,502 1.98% 12,649,502 2.00% 12,649,502 2.02% 12,649,502 2.04%
Existing LTC Shareholders(9)
550,000,000 85.60% 550,000,000 86.34% 550,000,000 87.08% 550,000,000 87.84% 550,000,000 88.61%
Jingkai Fund(4)
35,982,175 5.60% 35,982,175 5.65% 35,982,175 5.70% 35,982,175 5.75% 35,982,175 5.80%
Momenta(5) 564,828 0.09% 564,828 0.09% 564,828 0.09% 564,828 0.09% 564,828 0.09%
Merger Financing Investors(6)
11,953,579 1.86% 11,953,579 1.88% 11,953,579 1.89% 11,953,579 1.91% 11,953,579 1.92%
Per Share Pro Forma Equity Value of LTC
Ordinary Shares outstanding at
Closing(10)
$ 10 $ 10 $ 10 $ 10 $ 10
Per Share Pro Forma Book Value of
LTC Ordinary Shares outstanding at
Closing
0.46
0.37
0.28
0.19
0.09
(1)
Does not include LCAA Public Warrants that will remain outstanding immediately following the Business Combination and may be exercised thereafter to acquire LTC ADSs.
(2)
Does not include LCAA Private Warrants that will remain outstanding immediately following the Business Combination and may be exercised thereafter to acquire LTC ADSs.
(3)
Excludes 7,302,414 LTC Ordinary Shares that will be issuable upon the exercise of LTC Options issued and outstanding as of June 30, 2023, calculated after taking into account the Recapitalization and using the treasury stock method of accounting. The LTC Options are granted under the 2022 Share Incentive Plan, pursuant to which the maximum aggregate number of ordinary shares of LTC that may be issued under the 2022 Share Incentive Plan is 34,095,687, calculated after taking into account the Recapitalization. Also excludes any new LTC Ordinary Shares that will be issued to certain existing LTC shareholders in connection with the PIPE Financing and restructuring of existing investments in LTC.
(4)
Representing the aggregate of approximately 35,982,175 LTC Ordinary Shares to be issued to the Jingkai Fund at US$10.00 per share for an aggregate investment amount of RMB 2,600,000,000 (calculated using an exchange rate of 1 U.S. dollar = 7.2258 RMB) substantially concurrently with the Closing, which is invested in LTC after the outstanding principal amount of the convertible loan owed to Jingkai Fund by the WFOE is returned to Jingkai Fund. See “Agreements Entered into in Connection with the Business Combination — Restructuring of Existing Investments in LTC” for additional details.
(5)
Representing the Momenta Note in the principal amount of $11,297 issued by LTC on May 30, 2023. The Momenta Note will be automatically converted into fully paid and non-assessable LTC Ordinary Shares upon the Closing, if the Closing occurs on or prior to the Maturity Date, at a conversion price equal to $10.00. In addition, each of LTC and Momenta has a
 
18

 
voluntary redemption right to partially redeem $5,648 of the Momenta Note at any time during the period beginning from July 1, 2023 and ending on the date on which the Momenta Note has been fully converted into LTC Ordinary Shares. On November 11, 2023, LTC exercised such voluntary redemption right and subsequently made a payment of the Partial Redemption price of $5,648 to Momenta. LTC expects to issue to Momenta a new convertible note for the remaining balance of $5,648. See “Agreements Entered into in Connection with the Business Combination — Restructuring of Existing Investments in LTC” for additional details.
(6)
Representing (a) approximately 9,603,579 LTC Ordinary Shares that will be issued to the PIPE Investors pursuant to the PIPE Subscription Agreements, and (b) approximately 2,350,000 LTC Ordinary Shares underlying the Notes to be issued to the CB Investors pursuant to the Convertible Note Purchase Agreements, which Notes will be automatically converted into fully paid and non-assessable LTC Ordinary Shares if the Closing occurs prior to the Maturity Date, at a conversion price of $10.00. See “Agreements Entered into in Connection with the Business Combination — PIPE Financing” and “Agreements Entered into in Connection with the Business Combination —  Convertible Note Purchase Agreements” for additional details.
(7)
Includes 9,550,291 LTC ADSs underlying the LCAA Public Warrants (as converted into LTC Warrants).
(8)
Includes 5,486,784 LTC ADSs underlying the LCAA Private Warrants (as converted into LTC Warrants).
(9)
Includes 7,302,414 LTC Ordinary Shares that will be issuable upon the exercise of LTC Options issued and outstanding as of June 30, 2023, calculated after taking into account the Recapitalization and using the treasury stock method of accounting. Excludes any new LTC Ordinary Shares that will be issued to certain existing LTC shareholders in connection with the PIPE Financing and restructuring of existing investments in LTC.
(10)
In each redemption scenario, the per share pro forma equity of LTC Ordinary Shares will be US$10.00 at the Closing in accordance with the terms of the Merger Agreement.
Q:
What happens if the Business Combination is not consummated?
A:
If LCAA does not complete the Business Combination with LTC for whatever reason, LCAA would search for another target business with which to complete a business combination. If LCAA does not complete the Business Combination with LTC or another business combination by the Business Combination Deadline, LCAA must redeem 100% of the outstanding LCAA Public Shares, at a per-share price, payable in cash, equal to an amount then held in the Trust Account (net of taxes payable and less up to US$100,000 of interest to pay dissolution expenses) divided by the number of outstanding LCAA Public Shares and, following such redemption, LCAA will liquidate and dissolve. The Founder Shareholders have waived their redemption rights with respect to their LCAA Founder Shares in the event a business combination is not effected in the required time period, and, accordingly, their LCAA Founder Shares will be worthless.
Q:
How does the Sponsor of LCAA intend to vote on the proposals?
A:
The Sponsor and independent directors of LCAA (collectively, the “Founder Shareholders”) beneficially own and are entitled to vote an aggregate of 24.74% of the outstanding LCAA Shares. The Founder Shareholders have agreed to vote their shares in favor of the Business Combination Proposal. The Founder Shareholders also indicated that they intend to vote their shares in favor of all other proposals being presented at the extraordinary general meeting. In addition to the LCAA Shares held by the Founder Shareholders, LCAA would need 7,310,452 LCAA Public Shares, or 33.56%, of the 21,783,622 LCAA Public Shares to be voted in favor of the Business Combination Proposal and 12,134,842 LCAA Public Shares, or 55.71%, of the 21,783,622 LCAA Public Shares to be voted in favor of the Merger Proposal in order for them to be approved (assuming all outstanding shares are voted on each proposal). The Founder Shareholders have also agreed to waive their redemption rights.
Q:
Can the Sponsor redeem its Shares in connection with consummation of the Business Combination?
A:
No. The Founder Shareholders, including the Sponsor, have agreed to waive, for no consideration and for the sole purpose of facilitating the Business Combination, their redemption rights with respect to their LCAA Founder Shares in connection with the consummation of the Business Combination.
Q:
What interests does the Sponsor have in the Business Combination?
A:
In considering the recommendation of LCAA Board to vote in favor of the Business Combination, shareholders should be aware that, aside from their interests as shareholders, the Sponsor and the other Founder Shareholders have interests in the Business Combination that are different from, or in addition to, those of other shareholders generally. LCAA’s directors were aware of and considered these interests,
 
19

 
among other matters, in evaluating the Business Combination, in recommending to shareholders that they approve the Business Combination and in agreeing to vote their shares in favor of the Business Combination. Shareholders should take these interests into account in deciding whether to approve the Business Combination. These interests include, among other things, the fact that:

If the Business Combination with LTC or another business combination is not consummated by the Business Combination Deadline, LCAA will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding LCAA Public Shares for cash and, subject to the approval of its remaining shareholders and LCAA Board, dissolving and liquidating. In such event, the LCAA Founder Shares, which were acquired by the Sponsor for an aggregate purchase price of US$25,000 prior to the IPO and a portion of which were transferred to the independent directors of LCAA as consideration for their service, are expected to be worthless because the holders are not entitled to participate in any redemption or distribution of proceeds in the Trust Account with respect to such shares. On the other hand, if the Business Combination is consummated, each outstanding LCAA Founder Share will be converted into one LTC Ordinary Share, subject to adjustment described herein.

If LCAA is unable to complete a business combination within the required time period, the Sponsor will be liable under certain circumstances described herein to ensure that the proceeds in the Trust Account are not reduced by the claims of target businesses or claims of vendors or other entities that are owed money by LCAA for services rendered to, contracted for or for products sold to LCAA. If LCAA consummates a business combination, on the other hand, LCAA will be liable for all such claims.

The Sponsor acquired the LCAA Founder Shares, which will be converted into LTC Ordinary Shares in connection with the Business Combination, for an aggregate purchase price of US$25,000 prior to the IPO and a portion of the LCAA Founder Shares were transferred to the independent directors of LCAA as consideration for their service. If unrestricted and freely tradeable, the 7,162,718 LCAA Founder Shares would have had an aggregate market value of US$     , assuming the per share value of the LCAA Founder Shares is the same as the US$     per share closing price of LCAA Public Shares on Nasdaq on            , 2023, the most recent practicable date prior to the date of this proxy statement/prospectus, and an aggregate market value of US$     assuming the per share value of the LCAA Founder Shares is the same as the US$     per share closing price of LCAA Public Shares on Nasdaq on            , 2023, the record date. Alternatively, at the implied price per share of US$10 reflected in the Merger Agreement, the approximate dollar value of the LCAA Founder Shares would be US$71,627,180.

The Sponsor acquired the LCAA Private Warrants, which will be converted into LTC Warrants in connection with the Business Combination, for an aggregate purchase price of US$7.5 million. Based on the closing price of LCAA’s Public Warrants of US$      on Nasdaq on          , the record date for the extraordinary general meeting, the LCAA Private Warrants would be valued at US$      .

Given (i) the differential in the purchase price that the Sponsor paid for the LCAA Founder Shares as compared to the price of the LCAA Public Shares, (ii) the differential in the purchase price that the Sponsor paid for the LCAA Private Warrants as compared to the price of the LCAA Public Warrants, and (iii) the substantial number of LTC Ordinary Shares and/or LTC ADSs that the Sponsor will receive upon conversion of the LCAA Founder Shares and/or LCAA Private Warrants, the Sponsor and the other Founder Shareholders may earn a positive rate of return on their investment even if LTC ADSs trade below the price initially paid for the LCAA Units in the IPO and the LCAA Public Shareholders experience a negative rate of return following the completion of the Business Combination.

The Sponsor and LCAA’s officers and directors and their affiliates are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on LCAA’s behalf, such as identifying and investigating possible business targets and business combinations. However, if LCAA fails to consummate a business combination within the required period, they will not have any claim against the Trust Account for reimbursement. Accordingly, LCAA may not be able to reimburse these expenses if the Business Combination or another business combination is not completed by the Business Combination Deadline.
 
20

 

LCAA has provisions in the LCAA Articles waiving the corporate opportunities doctrine on an ongoing basis, which means that LCAA’s officers and directors have not been obligated and continue to not be obligated to bring all corporate opportunities to LCAA. While the provisions in the LCAA Articles waiving the corporate opportunities doctrine may have resulted in a potential conflict of interest as between the fiduciary duties or contractual obligations of LCAA’s officers and directors and the interests of LCAA and its shareholders, in practice it did not impact LCAA’s search for an initial business combination target, including LTC.

The Sponsor, as well as LCAA’s directors and officers, have agreed to waive their rights to liquidating distributions from the Trust Account with respect to the LCAA Founder Shares if LCAA fails to complete an initial business combination by the Business Combination Deadline.

The Founder Shareholders have agreed to waive their rights to conversion price adjustments with respect to any LCAA Founder Shares they may hold in connection with the consummation of the Business Combination and therefore, the LCAA Founder Shares will convert on a one-for-one basis into LTC Ordinary Shares at the Closing. None of the Founder Shareholders received any additional consideration for their waiver of the rights to liquidating distributions from the Trust Account or to conversion price adjustments with respect to any LCAA Founder Shares.

The Merger Agreement provides for the continued indemnification of LCAA’s current directors and officers and the continuation of directors and officers liability insurance covering LCAA’s current directors and officers.

LCAA’s Sponsor, affiliates of the Sponsor, officers and directors may make loans from time to time to LCAA to fund certain capital requirements. On January 11, 2021, the Sponsor agreed to loan LCAA an aggregate of up to US$300,000 to cover expenses related to the IPO pursuant to a promissory note. The Company has not drawn down any amounts under the promissory note. In addition, in order to finance transaction costs in connection with an intended Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of LCAA’s officers and directors, may, but are not obligated to, loan LCAA funds as may be required (the “Working Capital Loans”). Up to $1,500,000 of the Working Capital Loans may be convertible into warrants of the post Business Combination entity at a price of $1.50 per warrant at the option of the lender. Additional loans may be made after the date of this proxy statement/prospectus. If the Business Combination is not consummated, any outstanding loans will not be repaid and will be forgiven except to the extent there are funds available to LCAA outside of the Trust Account.

LCAA entered into an agreement, commencing on the date its securities were first listed on Nasdaq and up to the earlier of the consummation of a business combination or its liquidation, to pay the Sponsor a monthly fee of US$10,000 for office space, secretarial and administrative support.

The Sponsor and the other Founder Shareholders have agreed to, among other things, vote all of their LCAA Shares in favor of the proposals being presented at the extraordinary general meeting in connection with the Business Combination and waive their redemption rights with respect to their LCAA Shares in connection with the consummation of the Business Combination. As of the date of this proxy statement/prospectus, on an as-converted basis, the Sponsor and the other Founder Shareholders own, collectively, 24.74% of the issued and outstanding LCAA Shares.

Pursuant to the Merger Agreement, LCAA has the right to designate one director to the LTC Board post-Closing. Such director, in the future, may receive any cash fees, stock options or stock awards that the LTC Board determines to pay to its directors. LCAA has designated Anish Melwani to be a director on the LTC Board post-Closing. For more information regarding Anish Melwani, see the section titled “Management Following the Business Combination.”

The Founder Shareholders will enter into the Registration Rights Agreement at the Closing, which provides for registration rights of the Sponsor and certain other shareholders following consummation of the Business Combination.

Pursuant to the Sponsor Support Agreement, 10% of the Sponsor Shares will remain unvested at the Closing and become vested upon the commencement or official announcement of the first Business Collaboration within two (2) years of the Closing, and all or a portion of (as reasonably determined by
 
21

 
the Company in good faith) an additional 20% of the Sponsor Shares will remain unvested at the Closing and become vested upon each occurrence of (a) the commencement or official announcement of any additional Business Collaboration, or (b) an approved commitment to invest in the Company or one of its subsidiaries by an investor introduced or facilitated by Sponsor or its affiliate, in each case, within eighteen (18) months of the Closing. In connection with LCAA’s designation of Anish Melwani to serve as a director on the LTC Board post-Closing, the parties agreed that a Business Collaboration would occur upon the effectiveness of such appointment and as a result 10% of the Sponsor Shares will become vested immediately following the Closing.

In connection with the Extension Proposal, on March 22, 2023, the Sponsor deposited $990,000 into the Trust Account for the three-month extension of the Business Combination Deadline from March 15, 2023 to June 15, 2023 and to the extent a business combination is not consummated by LCAA by June 15, 2023, the Sponsor will deposit $330,000 for each subsequent one-month extension of the Business Combination Deadline from June 15, 2023 to March 15, 2024.
Q:
What equity stake will current LTC shareholders and current LCAA shareholders hold in the combined company immediately after the completion of the Business Combination, and what effect will potential sources of dilution have on the same?
A:
The following table presents the anticipated share ownership of various holders of LTC ADSs and LTC Ordinary Shares after the completion of the Business Combination after the Recapitalization under the various redemption scenarios. Unless otherwise specified, the share amounts and percentage ownership numbers have been determined after giving effect to redemptions in connection with the Extension EGM and have been determined under the assumptions set forth under the section titled “Frequently Used Terms and Basis of Presentation.” If actual facts are different from the assumptions set forth therein, the share amounts and percentage ownership numbers will be different.

Assuming No Redemption:   This presentation assumes that no LCAA Shareholder exercises redemption rights with respect to their LCAA Public Shares.

Assuming 25% Redemption:   This presentation assumes that LCAA Public Shareholders holding 5,445,906 LCAA Public Shares will exercise their redemption rights.

Assuming 50% Redemption:   This presentation assumes that LCAA Public Shareholders holding 10,891,811 LCAA Public Shares will exercise their redemption rights.

Assuming 75% Redemption:   This presentation assumes that LCAA Public Shareholders holding 16,337,717 LCAA Public Shares will exercise their redemption rights.

Assuming Maximum Redemption:   This presentation assumes that LCAA Public Shareholders holding 21,783,622 LCAA Public Shares will exercise their redemption rights. This presentation does not take into account the Minimum Available Cash Condition or the Net Tangible Assets Condition.
Assuming No
Redemption
Assuming 25%
Redemption
Assuming 50%
Redemption
Assuming 75%
Redemption
Assuming Maximum
Redemption
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Holders of LTC Ordinary Shares (including
LTC Ordinary Shares represented by LTC
ADSs) Not Reflecting Potential Sources of
Dilution
Existing LCAA Shareholders (excluding the
Founding Shareholders)(1)
21,783,622 3.51% 16,337,716 2.66% 10,891,811 1.79% 5,445,905 0.90% 0.00%
The Founder Shareholders(2)
7,162,718 1.16% 7,162,718 1.17% 7,162,718 1.17% 7,162,718 1.19% 7,162,718 1.20%
Existing LTC Shareholders(3)
542,697,586 87.51% 542,697,586 88.29% 542,697,586 89.08% 542,697,586 89.88% 542,697,586 90.70%
Jingkai Fund(4)
35,982,175 5.80% 35,982,175 5.85% 35,982,175 5.91% 35,982,175 5.96% 35,982,175 6.01%
Momenta(5) 564,828 0.09% 564,828 0.09% 564,828 0.09% 564,828 0.09% 564,828 0.09%
Merger Financing Investors(6)
11,953,579 1.93% 11,953,579 1.94% 11,953,579 1.96% 11,953,579 1.98% 11,953,579 2.00%
Total LTC Ordinary Shares (including LTC Ordinary Shares represented by LTC ADSs) Outstanding at Closing
620,144,508 100.00% 614,698,602 100.00% 609,252,697 100.00% 603,806,791 100.00% 598,360,886 100.00%
(1)
Does not include LCAA Public Warrants that will remain outstanding immediately following the Business Combination and may be exercised thereafter to acquire LTC ADSs.
 
22

 
(2)
Does not include LCAA Private Warrants that will remain outstanding immediately following the Business Combination and may be exercised thereafter to acquire LTC ADSs.
(3)
Excludes 7,302,414 LTC Ordinary Shares that will be issuable upon the exercise of LTC Options issued and outstanding as of June 30, 2023, calculated after taking into account the Recapitalization and using the treasury stock method of accounting. The LTC Options are granted under the 2022 Share Incentive Plan, pursuant to which the maximum aggregate number of ordinary shares of LTC that may be issued under the 2022 Share Incentive Plan is 34,095,687, calculated after taking into account the Recapitalization. Also excludes any new LTC Ordinary Shares that will be issued to certain existing LTC shareholders in connection with the PIPE Financing and restructuring of existing investments in LTC.
(4)
Representing the aggregate of approximately 35,982,175 LTC Ordinary Shares to be issued to the Jingkai Fund at US$10.00 per share for an aggregate investment amount of RMB 2,600,000,000 (calculated using an exchange rate of 1 U.S. dollar = 7.2258 RMB) substantially concurrently with the Closing, which is invested in LTC after the outstanding principal amount of the convertible loan owed to Jingkai Fund by the WFOE is returned to Jingkai Fund. See “Agreements Entered into in Connection with the Business Combination — Restructuring of Existing Investments in LTC” for additional details.
(5)
Representing the Momenta Note in the principal amount of $11,297 issued by LTC on May 30, 2023. The Momenta Note will be automatically converted into fully paid and non-assessable LTC Ordinary Shares upon the Closing, if the Closing occurs on or prior to the Maturity Date, at a conversion price equal to $10.00. In addition, each of LTC and Momenta has a voluntary redemption right to partially redeem $5,648 of the Momenta Note at any time during the period beginning from July 1, 2023 and ending on the date on which the Momenta Note has been fully converted into LTC Ordinary Shares. On November 11, 2023, LTC exercised such voluntary redemption right and subsequently made a payment of the Partial Redemption price of $5,648 to Momenta. LTC expects to issue to Momenta a new convertible note for the remaining balance of $5,648. See “Agreements Entered into in Connection with the Business Combination — Restructuring of Existing Investments in LTC” for additional details.
(6)
Representing (a) approximately 9,603,579 LTC Ordinary Shares that will be issued to the PIPE Investors pursuant to the PIPE Subscription Agreements, and (b) approximately 2,350,000 LTC Ordinary Shares underlying the Notes to be issued to the CB Investors pursuant to the Convertible Note Purchase Agreements, which Notes will be automatically converted into fully paid and non-assessable LTC Ordinary Shares if the Closing occurs prior to the Maturity Date, at a conversion price of $10.00. See “Agreements Entered into in Connection with the Business Combination — PIPE Financing” and “Agreements Entered into in Connection with the Business Combination —  Convertible Note Purchase Agreements” for additional details.
LCAA shareholders would experience dilution to the extent LTC issues additional shares after Closing. In addition, the table above excludes certain potential sources of dilution, namely, 7,302,414 LTC Ordinary Shares that will be issuable upon the exercise of LTC Options issued and outstanding as of June 30, 2023 (calculated after taking into account the Recapitalization and using the treasury stock method of accounting) and the LTC ADSs underlying the LCAA Public Warrants and the LCAA Private Warrants (as converted into the LTC Warrants). The following table presents the anticipated share ownership of various holders of LTC ADSs and LTC Ordinary Shares after the completion of the Business Combination after the Recapitalization assuming (i) the issuance of 7,302,414 LTC Ordinary Shares for the LTC Options issued and outstanding as of June 30, 2023 (calculated after taking into account the Recapitalization and using the treasury stock method of accounting), and the exercise of all LTC Warrants, under the various redemption scenarios. Unless otherwise specified, the share amounts and percentage ownership numbers have been determined after giving effect to redemptions in connection with the Extension EGM and have been determined under the assumptions set forth under the section titled “Frequently Used Terms and Basis of Presentation.” If actual facts are different from the assumptions set forth therein, the share amounts and percentage ownership numbers will be different.
 
23

 
Assuming
No Redemption
Assuming 25%
Redemption
Assuming 50%
Redemption
Assuming 75%
Redemption
Assuming Maximum
Redemption
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Ownership
in shares
Equity%
Total LTC Ordinary Shares (including
LTC Ordinary Shares represented by
LTC ADSs) Outstanding at Closing
Not Reflecting Potential Sources of
Dilution
620,144,508 96.52% 614,698,602 96.49% 609,252,697 96.46% 603,806,791 96.43% 598,360,886 96.40%
Potential Sources of Dilution
Shares underlying LCAA Public Warrants
9,550,291 1.49% 9,550,291 1.50% 9,550,291 1.51% 9,550,291 1.52% 9,550,291 1.54%
Shares underlying LCAA Private Warrants
5,486,784 0.85% 5,486,784 0.86% 5,486,784 0.87% 5,486,784 0.88% 5,486,784 0.88%
Shares underlying Granted LTC Options
7,302,414 1.14% 7,302,414 1.15% 7,302,414 1.16% 7,302,414 1.17% 7,302,414 1.18%
Total LTC Ordinary Shares (including
LTC Ordinary Shares represented by
LTC ADSs) Outstanding at Closing
(including LTC ADSs underlying
LCAA Public Warrants, LCAA
Private Warrants and LTC Ordinary
Shares underlying granted LTC
Options)
642,483,997 100.00% 637,038,091 100.00% 631,592,186 100.00% 626,146,280 100.00% 620,700,375 100.00%
Holders of LTC Ordinary Shares
(including LTC Ordinary Shares
represented by LTC ADSs) Reflecting
Potential Sources of Dilution
Existing LCAA Shareholders (excluding the Founder Shareholders)(1)
31,333,913 4.88% 25,888,007 4.06% 20,442,102 3.24% 14,996,196 2.39% 9,550,291 1.54%
The Founder Shareholders(2)
12,649,502 1.97% 12,649,502 1.98% 12,649,502 2.00% 12,649,502 2.02% 12,649,502 2.04%
Existing LTC Shareholders(3)
550,000,000 85.60% 550,000,000 86.34% 550,000,000 87.08% 550,000,000 87.84% 550,000,000 88.61%
Jingkai Fund(4)
35,982,175 5.60% 35,982,175 5.65% 35,982,175 5.70% 35,982,175 5.75% 35,982,175 5.80%
Momenta(5) 564,828 0.09% 564,828 0.09% 564,828 0.09% 564,828 0.09% 564,828 0.09%
Merger Financing Investors(6)
11,953,579 1.86% 11,953,579 1.88% 11,953,579 1.89% 11,953,579 1.91% 11,953,579 1.92%
Per Share Pro Forma Equity Value of
LTC Ordinary Shares outstanding at
Closing(7)
$ 10 $ 10 $ 10 $ 10 $ 10
(1)
Includes 9,550,291 LTC ADSs underlying the LCAA Public Warrants (as converted into LTC Warrants).
(2)
Includes 5,486,784 LTC ADSs underlying the LCAA Private Warrants (as converted into LTC Warrants).
(3)
Includes 7,302,414 LTC Ordinary Shares that will be issuable upon the exercise of LTC Options issued and outstanding as of June 30, 2023, calculated after taking into account the Recapitalization and using the treasury stock method of accounting. The LTC Options are granted under the 2022 Share Incentive Plan, pursuant to which the maximum aggregate number of ordinary shares of LTC that may be issued under the 2022 Share Incentive Plan is 34,095,687, calculated after taking into account the Recapitalization. Excludes any new LTC Ordinary Shares that will be issued to certain existing LTC shareholders in connection with the PIPE Financing and restructuring of existing investments in LTC.
(4)
Representing the aggregate of approximately 35,982,175 LTC Ordinary Shares to be issued to the Jingkai Fund at US$10.00 per share for an aggregate investment amount of RMB 2,600,000,000 (calculated using an exchange rate of 1 U.S. dollar = 7.2258) substantially concurrently with the Closing, which is invested in LTC after the outstanding principal amount of the convertible loan owed to Jingkai Fund by the WFOE is returned to Jingkai Fund. See “Agreements Entered into in Connection with the Business Combination — Restructuring of Existing Investments in LTC” for additional details.
(5)
Representing the Momenta Note in the principal amount of $11,297 issued by LTC on May 30, 2023. The Momenta Note will be automatically converted into fully paid and non-assessable LTC Ordinary Shares upon the Closing, if the Closing occurs on or prior to the Maturity Date, at a conversion price equal to $10.00. In addition, each of LTC and Momenta has a voluntary redemption right to partially redeem $5,648 of the Momenta Note at any time during the period beginning from July 1, 2023 and ending on the date on which the Momenta Note has been fully converted into LTC Ordinary Shares. On November 11, 2023, LTC exercised such voluntary redemption right and subsequently made a payment of the Partial Redemption price of $5,648 to Momenta. LTC expects to issue to Momenta a new convertible note for the remaining balance of $5,648. See “Agreements Entered into in Connection with the Business Combination — Restructuring of Existing Investments in LTC” for additional details.
(6)
Representing (a) approximately 9,603,579 LTC Ordinary Shares that will be issued to the PIPE Investors pursuant to the PIPE Subscription Agreements, and (b) approximately 2,350,000 LTC Ordinary Shares underlying the Notes to be issued to the CB Investors pursuant to the Convertible Note Purchase Agreements, which Notes will be automatically converted into fully paid and non-assessable LTC Ordinary Shares if the Closing occurs prior to the Maturity Date, at a conversion price of $10.00. See “Agreements Entered into in Connection with the Business Combination — PIPE Financing” and “Agreements Entered into in Connection with the Business Combination —  Convertible Note Purchase Agreements” for additional details.
(7)
In each redemption scenario, the per share pro forma equity of LTC Ordinary Shares will be US$10.00 at the Closing in accordance with the terms of the Merger Agreement.
This information should be read together with the pro forma combined financial information in the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.”
 
24

 
Q:
What is the effective underwriting fee that will be received by the underwriter for the IPO?
A:
Credit Suisse Securities (USA) LLC (“CS”) acted as the underwriter in LCAA’s IPO consummated on March 15, 2021. In connection with the IPO, LCAA paid an initial underwriting discount of $5,000,000 and an additional underwriting discount of $730,175 pursuant to CS’s exercise of its over-allotment option. Additionally, CS was entitled to receive deferred underwriting commissions upon consummation of the Business Combination in an amount equal to the greater of (a) $5,000,000 and (b) 3.5% of the cash amounts in the Trust Account immediately prior to the Closing after deducting the SPAC Shareholder Redemption Amount. Pursuant to a termination letter agreement, entered into by CS and LCAA on October 16, 2023 (the “CMA Termination Letter”), CS resigned from, and ceased to act in, its capacity as exclusive equity capital markets advisor to LCAA in connection with the Business Combination and proposed PIPE Financing. Given CS’s resignation as exclusive equity capital markets advisor to LCAA, in the CMA Termination Letter, CS also gratuitously, and without any consideration from LCAA, waived its claim to the deferred underwriting commission it would have been entitled to receive without any financial consideration from LCAA. CS already rendered its services in connection with the IPO pursuant to the Underwriting Agreement and is therefore waiving its right to be compensated. CS did not provide any other reasons for the deferred underwriting commission waiver. Furthermore, CS confirmed in the CMA Termination Letter that the waiver of its entitlement to the deferred underwriting commissions is not the result of any dispute or disagreement with LCAA or LTC, or any matter relating to LCAA’s or LTC’s respective operations, prospects, policies, procedures and practices. For more information, see the section titled “Proposal Two-The Business Combination Proposal — Termination of CS’s Engagements and Waiver of Deferred Underwriting Commission.”
Q:
What are the potential impacts on the Business Combination resulting from the resignations of CS and waiver of the deferred underwriting commission by CS?
A:
Effective as of October 12, 2023, CS resigned from, and ceased to act in, its capacity as a joint placement agent to LTC in connection with the proposed PIPE Financing. In connection with CS’s resignation from its capacity as a joint placement agent, CS waived its right to any fees (payable only upon closing of any private placement introduced by the placement agents) for its services as a joint placement agent to LTC.Effective as of October 16, 2023, pursuant to the CMA Termination Letter, CS also resigned from, and ceased to act in, its capacity as the exclusive equity capital markets advisor to LCAA in connection with the Business Combination and proposed PIPE Financing. Pursuant to the terms of CS’s engagement letter as LCAA’s exclusive equity capital markets advisor, CS would not have received any fees or expense reimbursements.
Certain provisions of CS’s engagement letter for its role as exclusive equity capital markets advisor to LCAA have survived CS’s resignation, which include (a) customary confidentiality obligations, and (b) the obligations of LCAA to indemnify and hold harmless CS and its affiliates, and its and their respective members, directors, officers, partners agents and employees from and against any losses, claims, damages or liabilities (i) based upon any untrue statement or any alleged untrue statement of any material fact contained in any offering material or proxy statement, or in any other communication provided by or on behalf of LCAA to any offeree, actual or prospective purchaser, acquirer or holder of any securities of LCAA (including any shareholder, stockholder or other holder of any securities of LCAA), or related to, arising out of or based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, or (ii) subject to certain exceptions, otherwise related to or arising out of the engagement of CS as LCAA’s exclusive equity capital markets advisor, CS’s performance thereof or any other services CS is asked to provide to LCAA in the future or has provided in the past, including in respect of its role as underwriter in the IPO. Certain provisions of CS’s engagement letter for its role as joint placement agent to LTC have also survived CS’s resignation, which include (a) customary confidentiality obligations with respect to advice or assistance rendered by CS, (b) obligations to reimburse CS for fees and expenses incurred prior to termination, including fees and expenses of CS’s legal counsel, and (c) customary indemnification obligations. LCAA and LTC believe these are provisions that customarily would survive termination of engagements of similar nature and neither LCAA nor LTC expects any of these obligations to have any material impact on LCAA, LTC or the combined company.
 
25

 
CS communicated to LCAA that its resignation as exclusive equity capital markets advisor to LCAA was due to its merger with UBS and the resulting movement of its bankers to UBS, as a result of which, CS expressed that it would not have sufficient resources to complete its engagement. CS did not communicate to LTC or LCAA, and neither LTC nor LCAA is aware, that the resignations were the result of any dispute or disagreement with LTC or LCAA, including any disagreement relating to the disclosure in this proxy statement/prospectus, the scope of its engagements further or any matter relating to LTC’s or LCAA’s operations, prospects, policies, procedures or practices. CS confirmed in its resignation letters that its resignation as a joint placement agent to LTC and as the exclusive equity capital markets advisor to LCAA is not the result of any dispute or disagreement with LTC or LCAA or any matter relating to LTC’s or LCAA’s operations, prospects, policies, procedures or practices.
The services provided by CS as a joint placement agent to LTC and the exclusive equity capital markets advisor to LCAA in connection with the proposed PIPE Financing and the Business Combination consisted primarily of (a) monitoring and providing views on the SPAC market, broader equity capital market conditions and relevant market trends and investor sentiment, (b) using its institutional platform and other publicly available industry and market data to provide benchmarking and structuring guidance, (c) reaching out to existing shareholders of LCAA and new investors in connection with the proposed PIPE Financing and Business Combination and collecting investor feedback, and (d) assisting in the preparation of investor presentation and other materials for investors. Other than the foregoing, CS was not involved in the preparation or review of any materials reviewed by the LTC Board or the LCAA Board or the management of LTC and LCAA as part of their services to LTC or LCAA or in the preparation of any disclosure that is included in this proxy statement/prospectus or any material underlying disclosure in this proxy statement/prospectus. CS has also withdrawn its association from this proxy statement/prospectus and the investor presentation and other materials presented to and reviewed by investors. As of the date of CS’s termination of engagement as a joint placement agent to LTC, no investor introduced by the joint placement agents had participated in any PIPE Financing as described in this proxy statement/prospectus. Accordingly, none of the PIPE investors were informed of CS’s resignation. In addition, the PIPE Financing is not contingent upon any continued involvement of CS in the transaction.
LTC and LCAA determined that there was no reason to discount the work or advice provided by CS in its capacity as a joint placement agent to LTC and the exclusive equity capital markets advisor to LCAA on the basis that (a) such work and advice primarily related to compiling publicly available information on publicly-traded companies selected by the management or representatives of LTC and LCAA on the basis of their professional judgment, providing benchmarking and structuring guidance based on such publicly available information, and providing views on the SPAC PIPE market, broader equity capital market conditions and relevant market trends in general; (b) such work and advice were prepared by CS with due care and with the view that they could be relied upon; and (c) when such work and advice were prepared and delivered, CS had not indicated any intention to terminate its engagements or withdraw any association with such work or advice. Neither LTC nor LCAA believes the termination of CS’s engagement as a joint placement agent to LTC will adversely affect the Business Combination in any manner because: (i) LTC did not expect that CS, or any of its affiliates, would facilitate additional financings before the Closing or play a role in the closing process; and (ii) the availability of the PIPE Financing and any contemplated post-transaction financing arrangements is not impacted by the termination.
In its capacity as the underwriter in LCAA’s IPO, CS was entitled to receive deferred underwriting commissions upon consummation of the Business Combination in an amount equal to the greater of (a) $5,000,000 and (b) 3.5% of the cash amounts in the Trust Account immediately prior to the Closing after deducting the SPAC Shareholder Redemption Amount. Given CS’s resignation as exclusive equity capital markets advisor to LCAA, in the CMA Termination Letter, CS also gratuitously, and without any consideration from LCAA, waived its claim to the deferred underwriting commission it would have been entitled to receive without any financial consideration from LCAA. CS already rendered its services in connection with the IPO pursuant to the Underwriting Agreement and is therefore waiving its right to be compensated. CS did not provide any other reasons for the deferred underwriting commission waiver. Furthermore, CS confirmed in the CMA Termination Letter that the waiver of its entitlement to the
 
26

 
deferred underwriting commissions is not the result of any dispute or disagreement with LCAA or LTC, or any matter relating to LCAA’s or LTC’s respective operations, prospects, policies, procedures and practices.
CS claims no remaining role in the Business Combination and has disclaimed any responsibility for any portion of this proxy statement/prospectus and any communication or prospectus filed by LCAA, LTC or their respective affiliates pursuant to Rule 425 under the Securities Act. Accordingly, shareholders should not place any reliance on the fact that CS was previously involved with any aspect of the Business Combination described in this proxy statement/prospectus or any communication or prospectus filed by LCAA, LTC or their respective affiliates pursuant to Rule 425 under the Securities Act. Neither LTC nor LCAA believes that CS’s resignations and waiver of fees (including waiver of the deferred underwriting commission) will impact the consummation of the Business Combination. Nonetheless, it is possible that CS’s resignations and waiver of fees (including waiver of the deferred underwriting commission) may adversely affect market perception of the Business Combination generally. If market perception of the Business Combination is negatively impacted, an increased number of shareholders of LCAA may vote against the Business Combination or seek to redeem their LCAA Public Shares for cash, which could potentially impact LCAA’s ability to consummate the Business Combination.
CS has disclaimed any responsibility for any portion of this proxy statement/prospectus and is unwilling to be associated with the disclosure in this proxy statement/prospectus or the underlying business or financial analysis related to the Business Combination. LTC and LCAA have asked CS to confirm whether it agrees with the disclosure regarding the termination of the engagements, but CS has declined to do so. Accordingly, there can be no assurances that CS agrees with such disclosure, and no inference can be drawn to this effect.
For more information, see the section titled “Proposal Two-The Business Combination Proposal — Termination of CS’s Engagements and Waiver of Deferred Underwriting Commission.”
Q:
When do you expect the Business Combination to be completed?
A:
It is currently anticipated that the Business Combination will be consummated promptly following the LCAA extraordinary general meeting, which is set for          , 2023; however, such meeting could be adjourned or postponed to a later date, as described above. The Closing is also subject to other customary closing conditions. For a description of the conditions for the completion of the Business Combination, see the section entitled “The Merger Agreement.”
Q:
What do I need to do now?
A:
LCAA urges you to carefully read and consider the information contained in this proxy statement/prospectus, including the annexes, and to consider how the Business Combination will affect you as a shareholder of LCAA. Shareholders should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus and on the enclosed proxy card.
Q:
When and where will the extraordinary general meeting take place?
A:
The extraordinary general meeting will be held on           , 2023, at            a.m., Eastern Time, at             and virtually over the Internet by means of a live audio webcast. You may attend the extraordinary general meeting webcast by accessing the web portal located at https://               . We encourage shareholders to attend the extraordinary general meeting virtually via the live webcast.
Q:
How do I vote?
A:
If you are a holder of record of LCAA Shares at the close of business on the record date, you may vote by (a) attending the extraordinary general meeting and voting in person, including virtually over the Internet by joining the live audio webcast and voting electronically by submitting a ballot through the web portal during the extraordinary general meeting webcast or (b) by submitting a proxy for the extraordinary general meeting. You may submit your proxy by completing, signing, dating and returning the enclosed proxy card so that it is received no later than 48 hours before the time appointed for the holding of the
 
27

 
extraordinary general meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting). By signing the proxy card and returning it, you are authorizing the individuals named on the proxy card to vote your shares at the extraordinary general meeting in the manner you indicate. If you hold your shares in “street name,” you should contact your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly voted and counted. In this regard, you must provide the broker, bank or nominee with instructions on how to vote your shares or, if you wish to attend the extraordinary general meeting virtually, and vote through the web portal, obtain a legal proxy from your broker, bank or nominee.
Q:
If my shares are held in “street name,” will my broker, bank or nominee automatically vote my shares for me?
A:
Your broker, bank or nominee can vote your shares without receiving your instructions on “routine” proposals only. Your broker, bank or nominee cannot vote your shares with respect to “non-routine” proposals unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank or nominee.
The NTA Proposal, the Business Combination Proposal, the Merger Proposal and the Adjournment Proposal are non-routine proposals. Accordingly, your broker, bank or nominee may not vote your shares with respect to these proposals unless you provide voting instructions.
Q:
May I change my vote after I have mailed my signed proxy card?
A:
Yes. Shareholders of record may send a later-dated, signed proxy card to LCAA’s transfer agent at the address set forth below so that it is received no later than 48 hours before the time appointed for the holding of the extraordinary general meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting) or attend the extraordinary general meeting and vote in person, including virtually over the Internet by joining the live audio webcast and voting electronically during the extraordinary general meeting webcast. Shareholders of record also may revoke their proxy by sending a notice of revocation to LCAA’s secretary, which must be received prior to the vote at the extraordinary general meeting. If you hold your shares in “street name,” you should contact your broker, bank or nominee to change your instructions on how to vote.
If you hold your shares in “street name” and wish to virtually attend the extraordinary general meeting and vote through the web portal, you must obtain a legal proxy from your broker, bank or nominee.
Q:
What constitutes a quorum for the extraordinary general meeting?
A:
A quorum is the minimum number of LCAA Shares that must be present to hold a valid meeting. A quorum will be present at the LCAA extraordinary general meeting if one or more shareholders holding a majority of the issued and outstanding LCAA Shares entitled to vote at the meeting are represented at the extraordinary general meeting in person or by proxy. Abstentions and broker non-votes will count as present for the purposes of establishing a quorum.
Q:
What shareholder vote thresholds are required for the approval of each proposal brought before the extraordinary general meeting?
A:    •
NTA Proposal — The approval of the NTA Proposal will require a special resolution under Cayman Islands law and pursuant to the LCAA Articles, being the affirmative vote of at least two thirds of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the extraordinary general meeting.

Business Combination Proposal — The approval of the Business Combination Proposal will require an ordinary resolution under Cayman Islands law and pursuant to the LCAA Articles, being the affirmative vote of a majority of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the extraordinary general meeting.

Merger Proposal — The approval of the Merger Proposal will require a special resolution under Cayman Islands law and pursuant to the LCAA Articles, being the affirmative vote of at least two
 
28

 
thirds of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the extraordinary general meeting.

Adjournment Proposal — The approval of the Adjournment Proposal will require an ordinary resolution under Cayman Islands law and pursuant to the LCAA Articles, being the affirmative vote of a majority of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon, at the extraordinary general meeting.
The LCAA Public Shares and LCAA Founder Shares are entitled to vote together as a single class on all matters to be considered at the extraordinary general meeting. Voting on all resolutions at the extraordinary general meeting will be conducted by way of a poll vote. Shareholders will have one vote for each LCAA Share owned at the close of business on the record date.
Brokers are not entitled to vote on the NTA Proposal, the Business Combination Proposal, the Merger Proposal or the Adjournment Proposal absent voting instructions from the beneficial holder. Abstentions and broker non-votes, while considered present for the purposes of establishing a quorum, will not count as votes cast at the extraordinary general meeting, and otherwise will have no effect on a particular proposal.
Q:
What happens if I fail to take any action with respect to the extraordinary general meeting?
A:
If you fail to take any action with respect to the extraordinary general meeting and fail to redeem your LCAA Public Shares following the procedure described in this proxy statement/prospectus and the Business Combination is approved by the LCAA shareholders and consummated, you will become a shareholder of LTC.
If you fail to take any action with respect to the extraordinary general meeting and the Business Combination is not approved, you will continue to be a shareholder of LCAA, as applicable, and LCAA will continue to search for another target business with which to complete an initial business combination. If LCAA does not complete an initial business combination by the Business Combination Deadline, LCAA must cease all operations except for the purpose of winding up, redeem 100% of the outstanding LCAA Public Shares, at a per-share price, payable in cash, equal to an amount then held in the Trust Account (net of taxes payable and less up to US$100,000 of interest to pay dissolution expenses) divided by the number of then-outstanding LCAA Public Shares, and as promptly as reasonably possible following such redemption, subject to the approval of LCAA’s remaining shareholders and its board of directors, dissolve and liquidate.
Q:
What should I do with my share certificates?
A:
Shareholders who do not elect to have their LCAA Shares redeemed for a pro rata share of the Trust Account should wait for instructions from LCAA’s transfer agent regarding what to do with their certificates.
LCAA Public Shareholders who elect to exercise their redemption rights must either tender their share certificates (if any) to LCAA’s transfer agent or deliver their LCAA Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC System, in each case no later than two (2) business days prior to the extraordinary general meeting as described above.
Q:
What should I do if I receive more than one set of voting materials?
A:
Shareholders may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast a vote with respect to all of your LCAA Shares.
 
29

 
Q:
Who can help answer my questions?
A:
If you have questions about the Business Combination or if you need additional copies of this proxy statement/prospectus or the enclosed proxy card, you should contact LCAA’s proxy solicitor at:
Morrow Sodali LLC
333 Ludlow Street
5th Floor, South Tower
Stamford, CT 06902
Telephone: (800) 662-5200 (banks and brokers can call collect at (203) 658-9400)
Email: LCAA.info@investor.morrowsodali.com
You may also obtain additional information about LCAA from documents filed with the SEC by following the instructions in the section entitled “Where You Can Find More Information.” If you are an LCAA Public Shareholder and you intend to seek redemption of your shares, you will need to either tender your share certificates (if any) to LCAA’s transfer agent at the address below or deliver your LCAA Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC System, in each case at least two business days prior to the extraordinary general meeting. If you have questions regarding the certification of your position or delivery of your share certificates and redemption request, please contact:
Continental Stock Transfer & Trust Company
1 State Street, 30th Floor
New York, New York 10004
Attention: Mark Zimkind
Email: spacredemption@continentalstock.com
 
30

 
SUMMARY OF THE PROXY STATEMENT/PROSPECTUS
This summary highlights selected information from this proxy statement/prospectus and does not contain all of the information that is important to you. To better understand the proposals to be submitted for a vote at the extraordinary general meeting, including the Business Combination, you should read this entire document carefully, including the Merger Agreement attached as Annex A to this proxy statement/prospectus. The Merger Agreement is the principal legal document that governs the Business Combination and the other transactions that shall be undertaken in connection with the Business Combination. It is also described in detail in this proxy statement/prospectus in the section entitled “Proposal Two — The Business Combination Proposal — The Merger Agreement and Related Agreements.”
The Parties to the Business Combination
Lotus Tech
Lotus Tech is a pioneering luxury battery electric vehicle (BEV) maker that designs, develops, and sells luxury lifestyle vehicles (non-sports car vehicles for daily usage) under the iconic British brand “Lotus.” With over seven decades of racing heritage and proven leadership in the automotive industry, the Lotus brand symbolizes the market-leading standards in performance, design and engineering. Fusing proprietary next-generation technology built on world class research and development capabilities and an asset-light model empowered by Geely Holding, Lotus Tech is breaking new grounds in electrification, digitization and intelligence.
The mailing address of Lotus Tech’s principal executive office is No. 800 Century Avenue, Pudong District, Shanghai, People’s Republic of China, and its phone number is +86 21 5466-6258. Lotus Tech’s corporate website address is www.group-lotus.com. Lotus Tech’s website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this proxy statement/prospectus.
LCAA
LCAA is a blank check company incorporated on January 5, 2021, as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. Based on its business activities, LCAA is a “shell company,” as defined under the Exchange Act, because it has no operations and nominal assets consisting almost entirely of cash.
Before the completion of an initial business combination, any vacancy on LCAA Board may be filled by a nominee chosen by holders of a majority of its Founder Shares. In addition, before the completion of an initial business combination, holders of a majority of the Founder Shares may remove a member of LCAA Board for any reason.
On March 15, 2021, LCAA consummated its IPO of 25,000,000 Units, at $10.00 per unit, and a concurrent private placement with the Sponsor of 5,000,000 LCAA Private Warrants at a price of $1.50 per warrant. Each Unit consists of one LCAA Public Share and one-third of one LCAA Public Warrant. On March 24, 2021, LCAA consummated the closing of its sale of an additional 3,650,874 Units pursuant to the partial exercise by the underwriters of their over-allotment option and a concurrent private placement with the Sponsor of 486,784 LCAA Private Warrants. As a result, an amount equal to $286,508,740 of the net proceeds was placed in the trust account, and will only be invested in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act that invest only in direct U.S. government treasury obligations.
In connection with the Extension EGM, holders of 6,867,252 LCAA Public Shares (representing 23.97% of the then outstanding LCAA Public Shares) exercised their right to redeem their shares for a pro rata portion of the funds in the Trust Account. As a result, approximately $70,200,754 (approximately $10.22 per LCAA Public Share) was removed from the Trust Account to pay such redeeming holders and approximately
 
31

 
$222,683,933.01 remained in the Trust Account. Following such redemptions, there are 21,783,622 LCAA Public Shares outstanding.
Pursuant to the LCAA Articles, except with respect to interest earned on the funds held in the Trust Account that may be released to LCAA to pay its income taxes, if any, the proceeds from the IPO and the sale of the LCAA Private Warrants held in the Trust Account will not be released from the Trust Account (i) to LCAA, until the completion of the initial business combination, or (ii) to the LCAA Public Shareholders, until the earliest of (a) the completion of the initial business combination, and then only in connection with those LCAA’s Class A ordinary shares that such shareholders properly elected to redeem, subject to the limitations described herein, (b) the redemption of any LCAA Public Shares properly tendered in connection with a shareholder vote to amend the LCAA Articles (A) to modify the substance or timing of LCAA’s obligation to provide holders of its Class A ordinary shares the right to have their shares redeemed in connection with the initial Business Combination or to redeem 100% of the LCAA Public Shares if LCAA does not complete its initial Business Combination prior to the Business Combination Deadline (the “Combination Period”) or (B) with respect to any other provision relating to the rights of holders of the LCAA’s Class A ordinary shares, and (c) the redemption of the LCAA Public Shares if LCAA has not consummated its Business Combination with the Combination Period, subject to applicable law. LCAA Public Shareholders who redeem their Class A ordinary shares in connection with a shareholder vote described in clause (b) in the preceding sentence shall not be entitled to funds from the Trust Account upon the subsequent completion of an initial Business Combination or liquidation if LCAA has not consummated an initial Business Combination within the Combination Period, with respect to such Class A ordinary shares so redeemed.
LCAA’s Units, the LCAA Public Shares and LCAA Public Warrants are each traded on Nasdaq under the symbols “LCAAU,” “LCAAA” and “LCAAW,” respectively.
LCAA’s registered office is located at 94 Solaris Avenue, Camana Bay, PO Box 1348, Grand Cayman, KY1-1108, Cayman Islands, and its telephone number is +65 6672-7600.
Merger Sub 1
Lotus Temp Limited (“Merger Sub 1”) is a newly formed Cayman Islands exempted company and a wholly-owned subsidiary of LTC. Merger Sub 1 was formed solely for the purpose of effecting the Business Combination and has not carried on any activities other than those in connection with the Business Combination. The address and telephone number for Merger Sub 1’s principal executive offices are the same as those for LTC.
Merger Sub 2
Lotus EV Limited (“Merger Sub 2”) is a newly formed Cayman Islands exempted company and a wholly-owned subsidiary of LTC. Merger Sub 2 was formed solely for the purpose of effecting the Business Combination and has not carried on any activities other than those in connection with the Business Combination. The address and telephone number for Merger Sub 2’s principal executive offices are the same as those for LTC.
Corporate History and Structure of Lotus Tech
Lotus Tech’s Lotus BEV business, founded in 2018, was carried out by Wuhan Lotus Cars Co., Ltd. (“Wuhan Lotus Cars”) and the Lotus BEV business unit of Ningbo Geely Automobile Research & Development Co., Ltd. (“Ningbo Geely R&D”) incorporated in the People’s Republic of China, Lotus Tech Creative Centre Limited (“Lotus Tech UK”) incorporated in United Kingdom and Lotus Tech Innovation Centre GmbH (“Lotus GmbH”) incorporated in Germany.
On August 9, 2021, Lotus Technology Inc (“LTC”) was incorporated as a limited liability company in the Cayman Islands.
Through a series of contemplated reorganization steps (the “Reorganization”), including transferring the assets and employees in the Lotus BEV business unit of Ningbo Geely R&D into Wuhan Lotus Cars and transferring the equity of Wuhan Lotus Cars to the WFOE, the Company gained control over WFOE through
 
32

 
Lotus HK on December 15, 2021. The equity interests of Lotus Tech UK and Lotus GmbH were transferred to Lotus Tech on December 29, 2021 and June 24, 2022, respectively.
On November 4, 2021, Lotus Tech entered into trademark licenses agreements with a related party, Group Lotus Limited, a wholly-owned subsidiary of Lotus Group International Limited (“LGIL”), pursuant to which, Lotus Tech received the “Lotus” trademark licenses as long as Lotus Tech conducts the business in relation to lifestyle vehicles (excluding sports car). Lotus Tech issued 216,700,000 ordinary shares as consideration for such trademark. The above Reorganization was completed on June 24, 2022.
On November 12, 2021, the former VIE and a third-party established Ningbo Robotics Co., Ltd. (“Ningbo Robotics”), in which the former VIE held 60% equity interest. In March 2022, the former VIE transferred its 60% legal equity interest of Ningbo Robotic to its then wholly-owned subsidiary, Sanya Lotus Venture Capital Co., Ltd.
On March 15, 2022, LTC declared a 10-for-1 stock split in the form of a stock dividend and such stock dividend is distributed to all the shareholders of LTC in proportion to their respective shareholdings in LTC. Before the stock dividend, LTC has 216,700,000 ordinary shares and 2,407,778 Series Pre-A Preferred Shares issued and outstanding with a par value of US$0.00001 per share. After the stock dividend, LTC has 2,167,000,000 ordinary shares and 24,077,780 Series Pre-A Preferred Shares issued and outstanding.
Since early 2023, LTC has been implementing a series of transactions to restructure its organization and business operations (the “Restructuring”). As of the date of this proxy statement/prospectus, LTC’s operations in mainland China are conducted by its mainland China subsidiaries and LTC does not have any VIE structure.
The following diagram illustrates Lotus Tech’s corporate structure, including its principal and other subsidiaries as of the date of this proxy statement/prospectus:
[MISSING IMAGE: fc_corporatehistory-bw.jpg]
Lotus Tech’s Holding Company Structure
LTC is not an operating company but a Cayman Islands holding company. LTC conducts its operations through its subsidiaries in China and Europe, and for the periods ended prior to the Restructuring, also through Wuhan Lotus E-Commerce Co., Ltd., the former VIE and its subsidiaries based in mainland China. Following the Restructuring, Lotus Tech’s operations in mainland China are currently conducted by its mainland China subsidiaries. The securities registered herein are securities of LTC, not those of its operating subsidiaries. Therefore, investors in LTC are not acquiring equity interest in any operating company but instead are acquiring interest in a Cayman Islands holding company.
LTC conducts its operations through its subsidiaries in China and Europe and its operations in mainland China are currently conducted by its mainland China subsidiaries. Historically, LTC relied on contractual arrangements among the WFOE, the former VIE and its nominee shareholders to direct the business operations of the former VIE and its subsidiaries. As a result, for the periods ended prior to the Restructuring, the former VIE’s financial results are consolidated in Lotus Tech’s consolidated and combined financial statements under the U.S. GAAP for accounting purposes.
 
33

 
In connection with the Restructuring, the WFOE, the former VIE, and nominee shareholders of the former VIE entered into VIE Restructuring Agreements in early 2023, pursuant to which, (i) WFOE acquired 100% equity interest in Sanya Lotus Venture Capital Co., Ltd. and Hangzhou Lotus Technology Service Co., Ltd., subsidiaries of the former VIE; (ii) except for the ICP license, all of the former VIE’s assets and liabilities, including its business contracts, intellectual properties and employees, will be transferred to the WFOE or subsidiaries of the WFOE at nil consideration; and (iii) the VIE Agreements were terminated. As of the date of this proxy statement/prospectus, LTC’s operations in mainland China are conducted by its mainland China subsidiaries and LTC does not have any VIE structure. LTC believes that the Restructuring will not have any material impact on its operations and financial results.
Risks and Uncertainties Relating to Doing Business in China
Lotus Tech faces various risks and uncertainties related to doing business in mainland China. Lotus Tech’s business operations are primarily conducted in mainland China, and it is subject to complex and evolving laws and regulations in mainland China. For example, it faces risks associated with regulatory approvals on offshore offerings, antimonopoly regulatory actions, and oversight on cybersecurity and data privacy, which may impact its ability to conduct certain businesses, accept foreign investments, or list on a United States stock exchange. These risks could result in a material adverse change in its operations and the value of Lotus Tech’s securities, significantly limit or completely hinder its ability to continue to offer securities to investors, or cause the value of such securities to significantly decline. For a detailed description of risks related to doing business in China, please refer to risks disclosed under “Risk Factors — Risks Relating to Doing Business in China.”
PRC government has significant authority in regulating Lotus Tech’s operations and may influence its operations. It may exert more oversight and control over offerings conducted overseas by, and/or foreign investment in, China-based issuers, which could significantly limit or completely hinder Lotus Tech’s ability to offer or continue to offer securities to investors. Implementation of industry-wide regulations in this nature may cause the value of such securities to significantly decline. For more details, see “Risk Factors — Risks Relating to Doing Business in China — Failure to meet the PRC government’s complex regulatory requirements on and significant oversight over our business operation could result in a material adverse change in our operations and the value of our securities.”
Risks and uncertainties arising from the legal system of mainland China, including risks and uncertainties regarding the interpretation and enforcement of laws and quickly evolving rules and regulations in mainland China, could result in a material adverse change in Lotus Tech’s operations and the value of its securities. For more details, see “Risk Factors — Risks Relating to Doing Business in China — We may be adversely affected by the complexity, uncertainties and changes in regulations of mainland China on automotive as well as internet-related businesses and companies.”
The Holding Foreign Companies Accountable Act
Pursuant to the HFCAA, if the SEC determines that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspections by the PCAOB for two consecutive years, the SEC will prohibit our securities from being traded on a national securities exchange or in the over-the-counter trading market in the United States. On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong, including Lotus Tech’s auditor. On December 15, 2022, the PCAOB issued a report that vacated its December 16, 2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is unable to inspect or investigate completely registered public accounting firms. Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms in mainland China and Hong Kong, among other jurisdictions. If PCAOB determines in the future that it no longer has full access to inspect and investigate completely accounting firms in mainland China and Hong Kong and Lotus Tech continues to use an accounting firm headquartered in one of these jurisdictions to issue an audit report on its financial statements filed with the Securities and Exchange Commission, Lotus Tech would be identified as a Commission-Identified Issuer following the filing of the annual report on Form 20-F for the relevant fiscal year. There can be no assurance that Lotus Tech would not be identified as a Commission-Identified Issuer for any future fiscal year, and if Lotus Tech were so identified
 
34

 
for two consecutive years, it would become subject to the prohibition on trading under the HFCAA. For more details, see “Risk Factors — Risks Related to Our Business — The PCAOB had historically been unable to inspect our auditor in relation to their audit work.”
Permissions Required from the PRC Authorities for Lotus Tech’s Operations
Lotus Tech conducts its business in mainland China primarily through its PRC subsidiaries. Its operations in mainland China are governed by laws and regulations of mainland China. As of the date of this proxy statement/prospectus, its PRC subsidiaries have obtained the necessary licenses and permits from the PRC government authorities.
If (i) Lotus Tech does not receive or maintain any required permissions or approvals, (ii) Lotus Tech inadvertently concluded that certain permissions or approvals have been acquired or are not required, or (iii) applicable laws, regulations or interpretations thereof change and Lotus Tech becomes subject to the requirement of additional permissions or approvals in the future, there is no assurance that Lotus Tech will be able to obtain such permissions or approvals in a timely manner, or at all, and such approvals may be rescinded even if obtained. Any such circumstance could subject Lotus Tech to sanctions imposed by the PRC regulatory authorities, which could include fines and penalties, proceedings against it, and other forms of sanctions, and Lotus Tech’s business, financial condition and results of operations may be materially and adversely affected. For more detailed information, see “Risk Factors — Risks Relating to Doing Business in China — We may be adversely affected by the complexity, uncertainties and changes in regulations of mainland China on automotive as well as internet-related businesses and companies.”
In addition, the PRC government has recently sought to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers. For more detailed information, see “Risk Factors — Risks Relating to Doing Business in China — The approval of and filing with the CSRC or other PRC government authorities is required in connection with this Business Combination or our listing under laws of mainland China. However, we cannot predict whether or when we will be able to obtain such approval or complete such filing, and even if we obtain such approval, it could be rescinded. Any failure to or delay in obtaining such approval or complying with such filing requirements in relation to offering, or a rescission of such approval, could subject us to sanctions imposed by the CSRC or other PRC government authorities.”
Cash and Asset Flows through Lotus Tech’s Organization
Lotus Technology Inc. is a holding company with no operations of its own. LTC currently conducts its operations through its subsidiaries in China and Europe. As a result, although other means are available for Lotus Tech to obtain financing at the holding company level, Lotus Technology Inc.’s ability to pay dividends to the shareholders and to service any debt it may incur may depend upon dividends paid by its subsidiaries. If any of its subsidiaries incurs debt on its own behalf in the future, the instruments governing such debt may restrict its ability to pay dividends to Lotus Technology Inc. In addition, its PRC subsidiaries are permitted to pay dividends to Lotus Technology Inc. only out of their accumulated after-tax-profits upon satisfaction of relevant statutory conditions and procedures, if any, as determined in accordance with PRC accounting standards and regulations. Further, its PRC subsidiaries are required to make appropriations to certain statutory reserve funds or may make appropriations to certain discretionary funds, which are not distributable as cash dividends except in the event of a solvent liquidation of the companies. For the six months ended June 30, 2023 and for the years ended December 31, 2022 and 2021, US$1.7 million, US$3.3 million and nil of service fees were paid by the former VIE and its subsidiaries to the subsidiaries of LTC.
LTC’s board of directors has complete discretion on whether to distribute dividends subject to its memorandum and articles of association and certain restrictions under Cayman Islands law. In addition, LTC’s shareholders may, by ordinary resolution, declare dividends, but no dividend shall exceed the amount recommended by LTC’s board of directors. Under Cayman Islands law, a Cayman Islands company may pay a dividend out of either profit or its share premium account, provided that in no circumstances may a dividend be paid out of the share premium account if this would result in the company being unable to pay its debts as they fall due in the ordinary course of business. The decision to distribute dividends is based on several factors, including LTC’s financial performance, growth prospects, and liquidity requirements. To date, other than the 10-for-1 stock split in the form of a stock dividend declared on March 15, 2022, LTC has not declared or paid
 
35

 
any dividend to its shareholders. It is expected that LTC will retain most, if not all, of its available funds and any future earnings after the Business Combination to fund the development and growth of its business. As a result, it is not expected that LTC will pay any cash dividends in the foreseeable future.
As a Cayman Islands exempted company and offshore holding company, LTC is permitted under laws and regulations of mainland China to provide funding to its wholly foreign-owned subsidiaries in mainland China only through loans or capital contributions, subject to the applicable governmental registration and approval requirements. In addition, LTC’s wholly foreign-owned subsidiaries in mainland China may provide RMB funding to their respective subsidiaries only through capital contributions and inter-company loans.
Under laws and regulations of mainland China, Lotus Tech’s PRC subsidiaries are subject to certain restrictions with respect to paying dividends or otherwise transferring any of their net assets to Lotus Tech. Remittance of dividends by a wholly foreign-owned enterprise out of mainland China is also subject to examination by the banks designated by State Administration of Foreign Exchange, or SAFE. The amounts restricted include the paid-in capital and the statutory reserve funds of its PRC subsidiaries. Furthermore, cash transfers from Lotus Tech’s PRC subsidiaries to entities outside of mainland China are subject to PRC governmental control on currency conversion. As a result, the funds in its PRC subsidiaries in mainland China may not be available to fund operations or for other use outside of mainland China due to interventions in, or the imposition of restrictions and limitations on, the ability of the holding company, or its subsidiaries by the PRC government on such currency conversion. see “Risk Factors — Risks Relating to Doing Business in China — We may rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business” and “Risk Factors — Risks Relating to Doing Business in China — Regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from making loans to or make additional capital contributions to our PRC subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business,” and “Risk Factors — Risks Relating to Doing Business in China — Governmental control of currency conversion may limit our ability to utilize our revenues effectively.”
Under laws of mainland China, Lotus Technology Inc. may provide funding to its PRC subsidiaries only through capital contributions or loans, subject to satisfaction of applicable government registration that Lotus Technology Inc. is not able to make direct capital contribution.
Lotus Tech has established cash management policies to direct how funds are transferred among LTC and its subsidiaries to ensure the efficient and compliant handling of funds. These policies dictate that each cash transfer shall (i) go through approval processes, ensuring that only authorized personnel are involved in the transaction, (ii) be properly recorded, facilitating audits and financial reviews, and (iii) be in compliance with all applicable laws and regulations, including anti-money laundering (AML) and know-your-customer (KYC) requirements.
For the six months ended June 30, 2023 and for the years ended December 31, 2022 and 2021, LTC provided loans with principal amount of US$214.6 million, US$5.9 million and nil to its subsidiaries, and made capital contribution of US$109.3 million, US$94.7 million and nil to its subsidiaries.
For the six months ended June 30, 2023 and for the years ended December 31, 2022 and 2021, the WFOE provided loans with principal amount of US$165.5 million, US$49.6 million and nil to its subsidiaries, and made capital contribution of US$21.6 million, US$137.2 million and US$108.9 million to its subsidiaries.
For the six months ended June 30, 2023 and for the years ended December 31, 2022 and 2021, the WFOE paid advances of nil, nil and US$11.1 million to the former VIE. For the six months ended June 30, 2023 and for the years ended December 31, 2022 and 2021, the WFOE collected advances of nil, US$10.6 million and nil from the former VIE.
For the six months ended June 30, 2023 and for the years ended December 31, 2022 and 2021, the other subsidiaries provided loans with principal amount of US$90.4 million, nil and nil to the WFOE, repaid loans of US$11.0 million, nil and nil to the LTC, repaid loans of US$54.7 million, nil and nil to the WFOE, and made capital contribution of US$19.9 million, nil and nil to the WFOE.
 
36

 
Permission, Review and Filing Required from the Authorities in Mainland China Relating to the Transactions
The PRC government has recently sought to exert more control and impose more restrictions on China-based companies raising capital offshore and such efforts may continue or intensify in the future. On July 6, 2021, the relevant PRC authorities promulgated the Opinions on Severely Cracking Down on Illegal Securities Activities According to Law, which emphasized the need to strengthen the supervision over overseas listings by mainland China-based companies. Effective measures, such as promoting the establishment of relevant regulatory systems, are to be taken to deal with the risks and incidents of mainland China-based overseas-listed companies, cybersecurity and data privacy protection requirements and similar matters. The revised Measures for Cybersecurity Review issued by Cyberspace Administration of China (the “CAC”) and several other administrations on December 28, 2021 (which took effect on February 15, 2022) also requires that, in addition to critical information infrastructure operators purchasing network products or services that affect or may affect national security, any “online platform operator” carrying out data processing activities that affect or may affect national security should also be subject to a cybersecurity review, and any “online platform operator” possessing personal information of more than one million users must apply for a cybersecurity review before its listing overseas. In the event a member of the cybersecurity review working mechanism is in the opinion that any network product or service or any data processing activity affects or may affect national security, the Office of Cybersecurity Review shall report the same to the Central Cyberspace Affairs Commission for its approval under applicable procedures and then conduct cybersecurity review in accordance with the revised Measures for Cybersecurity Review. In addition, on November 14, 2021, the CAC released the Regulations on Network Data Security (Draft for Comments), which clarified that data processors refer to individuals or organizations that autonomously determine the purpose and the manner of processing data, and if a data processor that processes personal data of more than one million users intends to list overseas, it must apply for a cybersecurity review. In addition, data processors that are listed overseas must carry out an annual data security assessment. Nonetheless, there remain substantial uncertainties with respect to the interpretation and implementation of these rules and regulations.
Further, according to the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies, or the Overseas Listing Trial Measures, and five supporting guidelines, issued by the China Securities Regulatory Commission, or the “CSRC,” on February 17, 2023, collectively the Overseas Listing Filing Rules, if a PRC domestic company intends to complete a direct or indirect overseas (i) initial public offering and listing, or (ii) listing of its assets through a single or multiple acquisitions, share swaps, shares transfers or other means, the issuer (if the issuer is a PRC domestic company) or its designated major PRC domestic operating entity (if the issuer is an offshore holding company), in each applicable event, the reporting entity, shall complete the filing procedures with the CSRC within three business days after the issuer submits its application documents relating to the initial public offering and/or listing or after the first public announcement of the relevant transaction (if the submission of relevant application documents is not required). According to the Overseas Listing Filing Rules and a set of Q&A published on the CSRC’s official website in connection with the release of the Overseas Listing Filing Rules, if it is explicitly required (in the form of institutional rules) by any regulatory authority having jurisdiction over the relevant industry and field that regulatory procedures should be performed prior to the overseas listing of a PRC domestic company, such company must obtain the regulatory opinion, approval and other documents from and complete any required filing with such competent authority before submitting a CSRC filing. The reporting entity shall make a timely report to the CSRC and update its CSRC filing within three business days after the occurrence of any of the following material events, if any of them occurs after obtaining its CSRC filing and before the completion of the offering and/or listing: (i) any material change to principal business, licenses or qualifications of the issuer; (ii) a change of control of the issuer or any material change to equity structure of the issuer; and (iii) any material change to the offering and listing plan. Once listed overseas, the reporting entity will be further required to report the occurrence of any of the following material events within three business days after the occurrence and announcement thereof to the CSRC: (i) a change of control of the issuer; (ii) the investigation, sanction or other measures undertaken by any foreign securities regulatory agencies or relevant competent authorities in respect of the issuer; (iii) change of the listing status or transfer of the listing board; and (iv) the voluntary or mandatory delisting of the issuer. In addition, the completion of any overseas follow-on offerings by an issuer in the same overseas market where it has completed its public offering and listing would necessitate a filing with the CSRC within three business days thereafter.
 
37

 
The Overseas Listing Filing Rules has recently been promulgated and came into effect on March 31, 2023 and there remain substantial uncertainties with respect to its interpretation and implementation. Based on the Notice on Administration for the Filing of Overseas Offering and Listing by Domestic Companies published by the CSRC on February 17, 2023, or the Notice on the Overseas Listing Filing, and the set of Q&A published on the CSRC’s official website, which are in connection with the release of the Overseas Listing Filing Rules, the CSRC clarifies that (i) on or prior to the effective date of the Overseas Listing Filing Rules, domestic companies that have already submitted valid applications for overseas offering and listing but have not obtained approval from overseas regulatory authorities or stock exchanges may reasonably arrange the timing for submitting their filing applications with the CSRC, and must complete the filing before the completion of their overseas offering and listing; (ii) a transition period until September 30, 2023 will be granted to domestic companies which have already obtained the approval from overseas regulatory authorities or stock exchanges but have not completed the indirect overseas listing prior to the effective date of the Overseas Listing Filing Rules; if domestic companies fail to complete the overseas listing prior to September 30, 2023, they shall file with the CSRC according to the requirements. Based on the Overseas Listing Filing Rules, the Notice on the Overseas Listing Filing and the set of Q&A published on the CSRC’s official website, Lotus Tech is required to complete the filing procedures with the CSRC in connection with this Business Combination as required by the Overseas Listing Filing Rules prior to the listing of its securities on Nasdaq. Lotus Tech has submitted a filing with the CSRC with respect to the Business Combination. As of the date of this proxy statement/prospectus, Lotus Tech has not completed the filing procedures with the CSRC.
As of the date of this proxy statement/prospectus, Lotus Tech has not been involved in any investigations on cybersecurity review initiated by the CAC and Lotus Tech has not received any official inquiry, notice, warning, or sanctions regarding cybersecurity and overseas listing from the CAC, CSRC or any other PRC authorities. Based on the opinion of our mainland China legal counsel, Han Kun Law Offices, according to its interpretation of the currently in-effect mainland China laws and regulations, Lotus Tech believes that, as of the date of this proxy statement/prospectus, the completion of the Transactions does not require the application or completion of any cybersecurity review from PRC governmental authorities, including the CAC. However, given (i) the uncertainties with respect to the enactment, implementation, and interpretation of the Overseas Listing Filing Rules and laws and regulations relating to data security, privacy, and cybersecurity; and (ii) that the PRC government authorities have significant discretion in interpreting and implementing statutory provisions in general, it cannot be assured that the relevant PRC government authorities will not take a contrary position or adopt different interpretations, or that there will not be changes in the regulatory landscape. In other words, the application and completion of a cybersecurity review, may be required in connection with the Transactions. In connection with this Business Combination and our listing, we are required to make a filing with the CSRC and to comply with other requirements pursuant to the Overseas Listing Filing Rules. However, given that the Overseas Listing Filing Rules were recently promulgated, there remains substantial uncertainty as to their interpretation, application, and enforcement and how they will affect our operations and our future financing.
If (i) Lotus Tech does not receive or maintain any required permission, or fails to complete any required review or filing, (ii) Lotus Tech inadvertently conclude that such permission, review or filing is not required, or (iii) applicable laws, regulations, or interpretations change such that it becomes mandatory for Lotus Tech to obtain any permission, review or filing in the future, Lotus Tech may have to expend significant time and costs to comply with these requirements. If Lotus Tech is unable to do so, on commercially reasonable terms, in a timely manner or otherwise, it may become subject to sanctions imposed by the PRC regulatory authorities, which could include fines and penalties, proceedings against it, and other forms of sanctions, and Lotus Tech’s ability to conduct its business, invest into China as foreign investments or accept foreign investments, complete the Transactions, or list on a U.S. or other overseas exchange may be restricted, and its business, reputation, financial condition, and results of operations may be materially and adversely affected. Further, Lotus Tech’s ability to offer or continue to offer securities to investors may be significantly limited or completely hindered, and the value of Lotus Tech’s securities may significantly decline. For more detailed information, see “Risk Factors — Risks Relating to Doing Business in China — We may be adversely affected by the complexity, uncertainties and changes in regulations of mainland China on automotive as well as internet-related businesses and companies,” and “— The approval of and filing with the CSRC or other PRC government authorities is required in connection with this Business Combination or our listing under laws of mainland China. However, we cannot predict whether or when we will be able to obtain such approval or complete such filing, and even if we obtain such approval, it could be rescinded. Any failure to or delay in
 
38

 
obtaining such approval or complying with such filing requirements in relation to offering, or a rescission of such approval, could subject us to sanctions imposed by the CSRC or other PRC government authorities.”
Recent Development of Lotus Tech
The following sets forth the unaudited selected consolidated financial data of Lotus Tech as of and for the nine months ended September 30, 2023. This financial data is not a comprehensive statement of Lotus Tech’s financial results as of and for the nine months ended September 30, 2023.
Revenues.   Lotus Tech estimates that its revenues in the nine months ended September 30, 2023 reached approximately US$317.9 million, representing an increase of approximately 8,594.0% from US$3.7 million in the nine months ended September 30, 2022, primarily due to the commencement of BEV sales and sales from the distribution of Lotus-brand ICE sports cars, auto parts, and peripheral products, as well as automotive design and development services provided to OEM customers.
Cost of revenues.    Lotus Tech estimates that its total cost of revenues in the nine months ended September 30, 2023 were approximately US$284.2 million, representing an increase of approximately 11,295.1% from US$2.5 million in the nine months ended September 30, 2022, primarily due to increased cost of sales from vehicle products, auto parts and peripheral products, and automotive design and development services provided to OEM customers.
Total operating expenses.    Lotus Tech estimates that its total operating expenses in the nine months ended September 30, 2023 were approximately US$541.6 million, representing an increase of approximately 63.0% from US$332.4 million in the nine months ended September 30, 2022, primarily due to increase in R&D costs in relation to new model development, increase in employee-related costs and professional services fees in relation to business operations and expansion, branding, advertising and marketing costs, increase in distribution network expansion costs, and decrease in amortization of deferred income relating to government grants.
Net loss.   As a result of the foregoing, Lotus Tech estimates that its net loss in the nine months ended September 30, 2023 was approximately US$526.5 million, representing an increase of approximately 43.6% from US$366.6 million in the nine months ended September 30, 2022.
Cash and restricted cash.   Lotus Tech estimates that as of September 30, 2023, it had cash and restricted cash of US$469.7 million, compared with US$739.5 million as of December 31, 2022. The change was mainly a result of net operating cash outflow in line with the business expansion, as well as the investing cash outflow partially offset by financing cash inflow.
Accounts receivable.   Lotus Tech estimates that as of September 30, 2023, Lotus Tech had accounts receivable of US$34.3 million, compared with US$8.7 million as of December 31, 2022. The change was mainly due to increase in sales to third-party distributors which resulted in an increase in accounts receivable from these third-party distributors.
Prepayments and other current assets.    Lotus Tech estimates that as of September 30, 2023, Lotus Tech had prepayments and other current assets of US$139.9 million, compared with US$53.1 million as of December 31, 2022. The increase was mainly related to an increase in prepayment for purchase of Lotus-brand ICE sports cars as well as increase in deductible VAT.
Short-term borrowings.    Lotus Tech estimates that as of September 30, 2023, Lotus Tech had short-term borrowings of US$246.9 million, compared with US$28.7 million as of December 31, 2022. The short-term borrowings were primarily related to borrowings from banks.
Accounts payable.    Lotus Tech estimates that as of September 30, 2023, Lotus Tech had accounts payable of US$289.3 million, compared with US$7.2 million as of December 31, 2022. The accounts payable were primarily related to increase in the purchase of BEVs and Lotus-brand ICE sports cars.
Accrued expenses and other current liabilities.    Lotus Tech estimates that as of September 30, 2023, Lotus Tech had accrued expenses and other current liabilities of US$536.9 million, compared with US$506.5 million as of December 31, 2022. The accrued expenses and other current liabilities were primarily
 
39

 
related to the acquisition of the distribution right and increase in accrued payroll, consumable materials for R&D expenditures and payable for other operating expenditures in line with business expansion.
Exchangeable notes.    Lotus Tech estimates that as of September 30, 2023, Lotus Tech had exchangeable notes of US$451.9 million, compared with US$427.1 million as of December 31, 2022. The exchangeable notes were primarily related to additional proceeds from issuance of exchangeable notes.
Deferred income.    Lotus Tech estimates that as of September 30, 2023, Lotus Tech had deferred income of US$266.4 million, compared with US$258.5 million as of December 31, 2022. The increase in deferred income was primarily related to additional asset-related subsidies received relating to the Group’s corporate buildings and plant net of amortization of deferred income relating to government grants.
Lotus Tech’s unaudited selected consolidated financial data set forth above is preliminary in nature and subject to changes. As a result, there is a possibility that our final results will vary from these preliminary estimates. Accordingly, you should not place undue reliance upon these preliminary financial results. For example, during the course of the preparation of the respective financial statements and related notes, additional items may be identified that would require material adjustments to be made to the preliminary estimated results presented. Lotus Tech’s preliminary and unaudited selected consolidated financial data as of and for the nine months ended September 30, 2023 may not be indicative of its financial results for future interim periods or for the full year ended December 31, 2023. See “Lotus Tech’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” included elsewhere in this proxy statement/ prospectus for information regarding trends and other factors that may influence Lotus Tech’s results of operations and for recent quarterly operating results.
The Business Combination Proposal
The Merger Agreement
On October 11, 2023, LCAA, LTC, Merger Sub 1 and Merger Sub 2 entered into the Merger Agreement, which restated and amended the Original Merger Agreement, dated as of January 31, 2023. Pursuant to the Merger Agreement, (i) Merger Sub 1 will merge with and into LCAA, with LCAA being the surviving company and becoming a wholly-owned subsidiary of LTC and the shareholders of LCAA becoming shareholders of LTC, and (ii) immediately following the consummation of the First Merger, Surviving Entity 1 will merge with and into Merger Sub 2, with Merger Sub 2 being the surviving company and remaining a wholly-owned subsidiary of LTC. The terms and conditions of the Business Combination are contained in the Merger Agreement, which is attached as Annex A to this proxy statement/prospectus. We encourage you to read the Merger Agreement carefully, as it is the principal legal document that governs the Business Combination.
Pro Forma Capitalization
LTC is valued at US$5.5 billion on a pre-money equity value basis (before taking into account the values of LTC Ordinary Shares issued to merger financing investors, including the Jingkai Fund, in any Pre-Closing Financing or PIPE Financing). It is estimated that, immediately after the Closing, (x) under the no redemption scenario, (i) the existing shareholders of LTC will own 87.51% of the issued and outstanding LTC Ordinary Shares, (ii) LCAA Public Shareholders will own 3.51% of the issued and outstanding LTC Ordinary Shares, and (iii) the Founder Shareholders will own 1.16% of the issued and outstanding LTC Ordinary Shares, and (y) under the maximum redemption scenario, (i) the existing shareholders of LTC will own 90.70% of the issued and outstanding LTC Ordinary Shares, (ii) LCAA Public Shareholders will not own any issued and outstanding LTC Ordinary Shares, and (iii) the Founder Shareholders will own 1.20% of the issued and outstanding LTC Ordinary Shares. The foregoing numbers of percentage ownership have been determined under the assumptions set forth under the section titled “Frequently Used Terms and Basis of Presentation.” If actual facts are different from the assumptions set forth therein, the percentage ownership numbers will be different.
Merger Consideration
Pursuant to the Merger Agreement, on the Closing Date and immediately prior to the First Effective Time, the following actions shall take place or be effected (in the order set forth hereinafter): (i) each preferred
 
40

 
share of LTC that is issued and outstanding immediately prior to such time shall be converted into one LTC Ordinary Share on a one-for-one basis, by re-designation and re-classification, in accordance with the LTC Articles, (ii) the Amended LTC Articles shall be adopted and become effective; (iii) immediately following the Preferred Share Conversion but immediately prior to the Recapitalization, 500,000,000 authorized but unissued ordinary shares of LTC shall be re-designated as shares of a par value of US$0.00001 each of such class or classes (however designated) as the LTC Board may determine in accordance with the Amended LTC Articles, such that the authorized share capital of LTC shall be US$50,000 divided into 5,000,000,000 shares of par value of US$0.00001 each, consisting of 4,500,000,000 ordinary shares of a par value of US$0.00001 each, and 500,000,000 shares of a par value of US$0.00001 each of such class or classes (however designated) as the LTC Board may determine in accordance with the Amended LTC Articles; (iv) immediately following the Re-designation and prior to the First Effective Time, each issued LTC Ordinary Share shall be recapitalized by way of a repurchase in exchange for the issuance of such number of LTC Ordinary Shares equal to the Recapitalization Factor (i.e., one such LTC Ordinary Share multiplied by the Recapitalization Factor), such that each LTC Ordinary Share will have a value of US$10.00 per share after giving effect to the Recapitalization; and (v) each of the issued and outstanding LTC Options shall be adjusted to give effect to the foregoing.
Pursuant to the Merger Agreement, (i) immediately prior to the First Effective Time, each LCAA Class B Ordinary Shares will be automatically converted into one LCAA Class A Ordinary Shares in accordance with the LCAA Articles, and each LCAA Class B Ordinary Shares shall no longer be issued and outstanding and shall automatically be cancelled, and each former holder of LCAA Class B Ordinary Shares shall thereafter cease to have any rights with respect to such shares, (ii) at the First Effective Time, each Unit issued by LCAA in its IPO or the exercise of the underwriter’s overallotment option, each consisting of one LCAA Class A Ordinary Share and one-third of an LCAA Warrant issued by LCAA to acquire LCAA Class A Ordinary Share, outstanding immediately prior to the First Effective Time shall be automatically detached and the holder thereof shall be deemed to hold one LCAA Class A Ordinary Share and one-third of an LCAA Warrant in accordance with the terms of the applicable Unit; provided that no fractional LCAA Warrant will be issued in connection with the Unit Separation such that if a holder of Units would be entitled to receive a fractional LCAA Warrant upon the Unit Separation, the number of LCAA Warrants to be issued to such holder upon the Unit Separation shall be rounded down to the nearest whole number of LCAA Warrants, (iii) immediately following the Unit Separation, each LCAA Class A Ordinary Share (which, for the avoidance of doubt, includes the LCAA Class A Ordinary Shares (A) issued in connection with the LCAA Class B Conversion and (B) held as a result of the Unit Separation) issued and outstanding immediately prior to the First Effective Time (other than any LCAA Shares that are owned by LCAA as treasury shares, any Redeeming LCAA Shares, Dissenting LCAA Shares, or any LCAA Shares held by the Founder Shareholders) shall automatically be cancelled and cease to exist in exchange for the right to receive one LTC ADS, and each LCAA Share issued and outstanding immediately prior to the First Effective Time held by the Founder Shareholders shall automatically be cancelled and cease to exist in exchange for the right to receive one LTC Ordinary Share and, as of the First Effective Time, each LCAA shareholder shall cease to have any other rights in and to such LCAA Shares, except as expressly provided in the Merger Agreement, and (iv) each LCAA Warrant (which, for the avoidance of doubt, includes the LCAA Warrants held as a result of the Unit Separation) outstanding immediately prior to the First Effective Time shall cease to be a warrant with respect to LCAA Public Shares and be assumed by LTC and converted into an LTC Warrant. Each LTC Warrant shall continue to have and be subject to substantially the same terms and conditions as were applicable to such LCAA Warrant immediately prior to the First Effective Time (including any repurchase rights and cashless exercise provisions) in accordance with the provisions of the Assignment, Assumption and Amendment Agreement.
In addition, pursuant to the Merger Agreement, (i) at the First Effective Time, each ordinary share, par value US$0.00001 per share, of Merger Sub 1, that is issued and outstanding immediately prior to the First Effective Time shall continue existing and constitute the only issued and outstanding share capital of Surviving Entity 1 and shall not be affected by the First Merger, and (ii) at the Second Effective Time, each ordinary share of Surviving Entity 1 that is issued and outstanding immediately prior to the Second Effective Time will be automatically cancelled and cease to exist without any payment therefor, and each ordinary share, par value US$0.00001 per share, of Merger Sub 2 immediately prior to the Second Effective Time shall remain outstanding and continue existing and constitute the only issued and outstanding share capital of Surviving Entity 2 and shall not be affected by the Second Merger.
 
41

 
Related Agreements
Sponsor Support Agreement
Concurrently with the execution of the Original Merger Agreement, LCAA, on January 31, 2023, the Founder Shareholders and LTC entered into the Sponsor Support Agreement, which was amended by the parties thereto on November 13, 2023, pursuant to which each Founder Shareholder has agreed, among other things and subject to the terms and conditions set forth therein: (i) to vote in favor of the Transactions or the Extension Proposal, (ii) during the interim period, not to transfer any LCAA Shares or LCAA Warrants (including any LCAA Shares or LCAA Warrants or any securities convertible into or exercisable or exchangeable for any LCAA Shares or LCAA Warrants), subject to certain exceptions, and (iii) not to transfer any LTC Ordinary Shares or LTC Warrants (including any LTC Ordinary Shares underlying such LTC Warrants) held by such Founder Shareholder immediately after the First Effective Time, if any, for a period of six (6) months after the Closing, subject to certain exceptions. The Sponsor also agreed to use commercially reasonable efforts to facilitate discussions between LTC and entities holding brands that may be approved by LTC from time to time (each, a “Cooperating Entity”), with respect to potential collaborations between Lotus Tech and a Cooperating Entity in connection with the following activities of LTC: product development, marketing, customer engagement, retail space, and technology infrastructure development.
Some of the LCAA Class B Ordinary Shares held by the Sponsor as of the date of the Sponsor Support Agreement (the “Sponsor Shares”) will be subject to earn-out restrictions pursuant to the Sponsor Support Agreement. In addition, at the request of LTC, the Sponsor will on the Closing Date transfer, directly or indirectly, to one or more shareholders of LCAA up to 5% of the Sponsor Shares as consideration to induce such shareholder(s) of LCAA to waive its redemption rights (including by having such LCAA shareholder enter into, execute and deliver a non-redemption agreement) in connection with LCAA shareholders’ approval of the Transaction Proposals (as defined in the Merger Agreement) or approval of both the Extension Proposal (as defined in the Merger Agreement) and the Transaction Proposals, as may be mutually determined by LTC and LCAA.
LTC Shareholder Support Agreement
Concurrently with the execution of the Original Merger Agreement, on January 31, 2023, LCAA, LTC and certain of the shareholders of LTC entered into the LTC Shareholder Support Agreement, pursuant to which certain shareholders holding sufficient number, type and classes of the issued and outstanding shares of LTC to approve the Transactions have each agreed, among other things and subject to the terms and conditions set forth therein: (i) to vote in favor of the Transactions, and (ii) during the interim period and for a period following the Closing, not to transfer any LTC Ordinary Shares held by such shareholder, subject to certain exceptions. See “Agreements Entered Into in Connection with the Business Combination —  LTC Shareholder Support Agreement.”
Distribution Agreement
Concurrently with the execution of the Original Merger Agreement, on January 31, 2023, LTIL entered into the distribution agreement (the “Distribution Agreement”) with Lotus Cars Limited, the entity carrying out the sportscar manufacturing operations of Lotus Group International Limited and its subsidiaries (collectively, “Lotus UK”), pursuant to which LTIL is appointed as the exclusive global distributor (excluding the United States, where LTIL will act as the head distributor with the existing regional distributor continuing its functions) for Lotus Cars Limited to distribute vehicles, parts and certain tools, and to provide after sale services and brand, marketing and public relations for such vehicles, part and tools distributed by it on the terms and conditions of the Distribution Agreement. See “Agreements Entered Into in Connection with the Business Combination —  Distribution Agreement.”
Put Option Agreements
Concurrently with the execution of the Original Merger Agreement, on January 31, 2023, LTC entered into a Put Option Agreement with each of Geely and Etika, pursuant to which each of Geely and Etika is granted the right to require LTC to purchase all of the equity interests held by each of Geely and Etika in Lotus Advance Technologies Sdn Bhd, the parent company of Lotus UK, at a pre-agreed price which will be
 
42

 
calculated based on the total revenue of Lotus Group International Limited for the year of 2024 adjusted to exclude net debt, at a future date during the period from April 1, 2025 to June 30, 2025 and contingent upon satisfaction of certain pre-agreed condition. See “Agreements Entered Into in Connection with the Business Combination —  Put Option Agreements.”
PIPE Financing
In connection with the Business Combination and following the execution of the Original Merger Agreement, LTC entered into certain Subscription Agreements (the “PIPE Subscription Agreements”) with certain investors (the “PIPE Investors”), pursuant to which the PIPE Investors have committed to subscribe for and purchase LTC Ordinary Shares at $10.00 per share. As of the date of this proxy statement/prospectus, the aggregate amount of the PIPE Investment was approximately $96,035,788. Pursuant to the PIPE Subscription Agreements, the obligations of the parties to consummate the PIPE Investment are subject to the satisfaction or waiver of certain customary closing conditions of the respective parties, including, among others, (i) all conditions precedent under the Merger Agreement having been satisfied or waived (other than those to be satisfied at the closing of the Business Combination), (ii) the accuracy of representations and warranties in all material respects, (iii) material compliance with covenants, and (iv) all of the consents from, and filings and/or registrations with, applicable governmental authority as required by applicable PRC laws in connection with the PIPE Investor’s outbound direct investment in LTC shall have been duly obtained and completed. Under the PIPE Subscription Agreements, LTC agreed to file with the SEC, within 30 to 45 days after the Closing Date, a registration statement registering the resale of such LTC Ordinary Shares to be issued to the PIPE Investors and will use its commercially reasonable efforts to have such registration statement declared effective as soon as practicable after the filing thereof. For more information, see the section titled “Agreements Entered Into in Connection with the Business Combination — PIPE Financing.”
Convertible Note Purchase Agreements
In connection with the Business Combination and following the execution of the Original Merger Agreement, LTC entered into certain Convertible Note Purchase Agreements (as may be amended from time to time, the “Convertible Note Purchase Agreements”) with certain investors (the “CB Investors”). Pursuant to the Convertible Note Purchase Agreements, LTC agreed to issue $23.5 million aggregate principal amount of unsecured convertible note (collectively, the “Notes” and each a “Note”) due to mature on the date that is one year following the issue date (as may be extended by the CB Investors for an additional six months, the “Maturity Date”). As of the date of this proxy statement/prospectus, not all Notes have been issued and it is expected that all of the Notes will be issued prior to the Closing. The Notes bear interest at a rate of 8% per annum. If the consummation of the Business Combination occurs prior to the Maturity Date, all of the then outstanding principal amount and any accrued but unpaid interest (as applicable) of the Notes will be automatically converted into fully paid and non-assessable LTC Ordinary Shares upon consummation of the Business Combination at a conversion price equal to the lesser of (A) $10.00, and (B) the lowest per share price at which any LTC Ordinary Shares are issued in connection with any PIPE Investment. For more information, see the section titled “Agreements Entered Into in Connection with the Business Combination — Convertible Note Purchase Agreements.”
Restructuring of Existing Investments in LTC
In connection with the Business Combination and following the execution of the Original Merger Agreement, on April 28, 2023, LTC entered into a convertible note purchase agreement with Momenta (the “Momenta Note Purchase Agreement”), pursuant to which LTC agreed to issue to Momenta a convertible note denominated in the U.S. dollars in the principal amount of the U.S. dollar equivalent of RMB 80,000,000 (the “Momenta Note”) due to mature on May 30, 2024. The Momenta Note in the principal amount of $11,296,563.02 was issued by LTC on May 30, 2023 following Lotus Tech’s acquisition of Momenta’s 40% equity interest in Ningbo Robotics, the joint venture formed by Lotus Tech and Momenta, for a cash consideration of RMB 80,000,000 pursuant to Momenta’s exit right under the joint venture agreement of Ningbo Robotics. The Momenta Note bears (a) a simple interest computed at a rate of 8% per annum, if the consummation of the Business Combination fails to occur on or prior to November 12, 2023 due to reasons not attributable to Momenta, or (b) no interest, under any other circumstance. According to the terms of the Momenta Note, if the consummation of the Business Combination occurs on or prior to the maturity date, all
 
43

 
of the then outstanding principal amount and any accrued but unpaid interest (as applicable) of the Momenta Note shall be automatically converted into such number of fully paid and non-assessable LTC Ordinary Shares, at a conversion price equal to the lesser of (A) US$10.00 and (B) the lowest per share price at which any ordinary shares of the Company are issued in any PIPE Investment. If the consummation of the Business Combination fails to occur on or prior to the maturity date, Momenta shall be entitled to request redemption of the then outstanding amount of the Momenta Note and LTC shall make payment of the redemption price in an amount equal to the outstanding principal amount and the accrued interest (as applicable) to Momenta promptly (and in any event within two Business Days after the maturity date). In addition, each of LTC and Momenta has a voluntary redemption right to partially redeem or request partial redemption of the Momenta Note at any time during the period beginning from July 1, 2023 and ending on the date on which the Momenta Note has been fully converted into LTC Ordinary Shares, at a redemption price that is equal to 50% of the principal amount plus any accrued but unpaid interest (as applicable) (the “Partial Redemption Price”) by providing written notice to the other party, and LTC shall make payment of the Partial Redemption Price to Momenta within 10 business days following delivery or receipt of such written notice, as the case may be. On November 11, 2023, LTC exercised such voluntary redemption right and subsequently made payment of the Partial Redemption Price to Momenta. LTC expects to issue to Momenta a new convertible note in the principal amount of $5,648,281.51 upon surrender of the original Momenta Note to LTC by Momenta.
In connection with the Business Combination and following the execution of the Original Merger Agreement, on April 27, 2023, LTC entered into a PIPE subscription agreement with Jingkai Fund (the “Jingkai Subscription Agreement”), pursuant to which Jingkai Fund has committed to subscribe for and purchase LTC Ordinary Shares for US$10.00 per share, for an investment amount of RMB2,600,000,000. Jingkai Fund’s investment in LTC will be made after the outstanding principal amount of the convertible loan owed to Jingkai Fund by the WFOE is returned to Jingkai Fund. Pursuant the Jingkai Subscription Agreement, the obligations of the parties to consummate the investment are subject to the satisfaction or waiver of certain customary closing conditions of the respective parties, including, among others, (i) all conditions precedent under the Merger Agreement having been satisfied or waived (other than those to be satisfied at the closing of the Business Combination), (ii) the accuracy of representations and warranties in all material respects, (iii) material compliance with covenants, and (iv) all of the consents from, and filings and/or registrations with, applicable governmental authority as required by applicable PRC laws in connection with Jingkai Fund’s outbound direct investment in LTC shall have been duly obtained and completed. For more information, see the section titled “Agreements Entered into in Connection with the Business Combination — Restructuring of Existing Investments in LTC.”
Lock-Up Agreements
In connection with and following the execution of the Original Merger Agreement, LCAA and LTC entered into lock-up agreements (each a “Lock-Up Agreement”) with each of the shareholders of LTC that are not parties to the LTC Shareholder Support Agreement, pursuant to which, among other things, each such LTC shareholder agrees not to transfer, for a period of six (6) months following the Closing, certain LTC Ordinary Shares such LTC shareholder will hold following the Closing, on the terms and subject to the conditions set forth in the Lock-Up Agreements.
Registration Rights Agreement
The Merger Agreement contemplates that, at the Closing, LTC, the Founder Shareholders and certain shareholders of LTC will enter into a Registration Rights Agreement (the “Registration Rights Agreement”), which provides for the customary registration rights of the Sponsor and other parties thereto, including certain shareholders of LTC. See “Agreements Entered Into in Connection with the Business Combination — Registration Rights Agreement.”
Assignment, Assumption and Amendment Agreement
The Merger Agreement contemplates that, at the Closing, LTC, LCAA, Continental Stock Transfer & Trust Company (“Continental”) and Equiniti Trust Company, LLC (‘‘Equiniti”) will enter into the Assignment, Assumption and Amendment Agreement, pursuant to which, effective upon the Closing LCAA Warrants will be assumed by LTC, Equiniti will be engaged as the warrant agent under the Warrant
 
44

 
Agreement, and Continental, as the warrant agent for LCAA, shall assign to Equiniti all of its rights, interests and obligations in and under the Warrant Agreement. See “Agreements Entered Into in Connection with the Business Combination — Assignment, Assumption and Amendment Agreement.”
The NTA Proposal
The shareholders of LCAA will vote on a separate proposal to approve and authorize the NTA Amendment, which, if approved, shall become effective immediately prior to the consummation of the proposed Business Combination, to remove from the LCAA Articles the prohibition on redemptions of LCAA Public Shares in an amount that cause LCAA’s net tangible assets (“NTA”) to be less than $5,000,001 in connection with any vote held to approve a proposed business combination, by way of a special resolution. The NTA Proposal is conditioned upon the approval of the Business Combination Proposal. Please see “Proposal One — The NTA Proposal.”
The Merger Proposal
The shareholders of LCAA will vote on a separate proposal to authorize the First Plan of Merger by way of a special resolution. Please see “The Merger Proposal.”
The Adjournment Proposal
If, based on the tabulated vote, there are insufficient votes at the time of the Extraordinary General Meeting to authorize LCAA to consummate the First Merger or the Business Combination or if holders of LCAA Public Shares have elected to redeem an amount of LCAA Public Shares such that the minimum available cash condition or the net tangible assets condition contained in the Merger Agreement would not be satisfied, the chairman of the meeting may (and LCAA is required under the Merger Agreement to) submit a proposal to adjourn the Extraordinary General Meeting to a later date or dates, if necessary, to permit further solicitation of proxies. Please see “The Adjournment Proposal.”
Date, Time and Place of Extraordinary General Meeting of LCAA shareholders
The Extraordinary General Meeting of the shareholders of LCAA shall be held at   AM/PM    time, on         , 2023 at            and virtually over the Internet via live audio webcast at      to consider and vote upon the NTA Proposal, the Business Combination Proposal, the Merger Proposal and if necessary, the Adjournment Proposal.
Voting Power; Record Date
Shareholders shall be entitled to vote or direct votes to be cast at the Extraordinary General Meeting if they owned LCAA Shares at the close of business on         , 2023, which is the record date for the Extraordinary General Meeting. Voting at the Extraordinary General Meeting will take place by poll voting and, accordingly, shareholders shall have one vote for each LCAA Share owned at the close of business on the record date. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker or bank to ensure that votes related to the shares you beneficially own are properly counted. Warrants do not have voting rights. On the record date, there were         LCAA Public Shares and         Founder Shares outstanding.
Quorum and Vote of LCAA shareholders
A quorum of LCAA shareholders is necessary to hold a valid meeting. A quorum shall be present at the Extraordinary General Meeting if one or more shareholders holding at least a majority of the total issued LCAA Shares entitled to vote at the Extraordinary General Meeting are present in person or by proxy. As of the record date,          LCAA Shares would be required to achieve a quorum. An abstention or broker non-vote will be counted towards the quorum requirement but will not count as a vote cast at the Extraordinary General Meeting. The proposals presented at the Extraordinary General Meeting shall require the following votes:

NTA Proposal — The approval of the NTA Proposal will require a special resolution under Cayman Islands law and the LCAA Articles, being the affirmative vote of at least two thirds of the votes of
 
45

 
LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.

Business Combination Proposal — The approval of the Business Combination Proposal will require an ordinary resolution under Cayman Islands law and the LCAA Articles, being the affirmative vote of a majority of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.

Merger Proposal — The approval of the Merger Proposal will require a special resolution under Cayman Islands law and the LCAA Articles, being the affirmative vote of at least two thirds of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.

Adjournment Proposal — The approval of the Adjournment Proposal, if presented, will require an ordinary resolution under Cayman Islands law and the LCAA Articles, being the affirmative vote of a majority of the votes of LCAA shareholders entitled to vote, who attend, in person or by proxy, and vote thereupon at the Extraordinary General Meeting.
Redemption Rights
Pursuant to the LCAA Articles, in connection with the completion of the Business Combination, LCAA Public Shareholders may elect to have their LCAA Public Shares redeemed for cash at the applicable redemption price per share calculated in accordance with the LCAA Articles. For illustrative purposes, as of            , 2023, this redemption amount would have amounted to approximately $       per share. In this proxy statement/prospectus, these rights to demand redemption of the LCAA Public Shares are sometimes referred to as “redemption rights.” LCAA Public Shareholders may elect to exercise such redemption rights, regardless of whether they vote or, if they do vote, irrespective of whether they vote for or against the Business Combination Proposal or the Merger Proposal.
If you are an LCAA Public Shareholder and wish to exercise your right to have your LCAA Public Shares redeemed, you must:

submit a written request to Continental, LCAA’s transfer agent, in which you (i) request that LCAA redeem all or a portion of your LCAA Public Shares for cash, and (ii) identify yourself as the beneficial holder of the LCAA Public Shares and provide your legal name, phone number and address; and

either tender your share certificates (if any) to Continental, LCAA’s transfer agent, or deliver your LCAA Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC (Deposit/Withdrawal at Custodian) System.
LCAA Public Shareholders must complete the procedures for electing to redeem their LCAA Public Shares in the manner described above prior to       on         , 2023 (two business days prior to the vote at the Extraordinary General Meeting) in order for their LCAA Public Shares to be redeemed.
There is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC system. The transfer agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not to pass this cost on to the redeeming shareholder. In the event the Business Combination is not consummated this may result in an additional cost to shareholders for the return of their shares.
If you hold the LCAA Public Shares in “street name,” you will have to coordinate with your broker or bank to have the LCAA Public Shares you beneficially own certificated and delivered electronically.
Holders of Units must elect to separate the Units into the underlying LCAA Public Shares and LCAA Warrants prior to exercising redemption rights with respect to the LCAA Public Shares. If holders hold their Units in an account at a brokerage firm or bank, holders must notify their broker or bank that they elect to separate the Units into the underlying LCAA Public Shares and LCAA Warrants, or if a holder holds Units registered in its own name, the holder must contact Continental, LCAA’s transfer agent, directly and instruct it to do so. The redemption rights include the requirement that a holder must identify itself in writing as a beneficial holder and provide its legal name, phone number and address to Continental in order to validly redeem its LCAA Public Shares.
 
46

 
If the Business Combination is not consummated, the LCAA Public Shares will not be redeemed and instead will be returned to the respective holder, broker or bank. In such case, LCAA shareholders may only share in the assets of the trust account upon the liquidation of LCAA. This may result in LCAA shareholders receiving less than they would have received if the Business Combination was completed and they had exercised redemption rights in connection therewith due to potential claims of creditors.
If an LCAA Public Shareholder satisfies the requirements for exercising redemption rights with respect to all or a portion of the LCAA Public Shares he, she or it holds and the Business Combination is consummated, LCAA will redeem such LCAA Public Shares for a per-share price, payable in cash, equal to the pro rata portion of the amount on deposit in the trust account calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the funds held in the trust account and not previously released to LCAA to pay income taxes. There are currently no owed but unpaid income taxes on the funds in the trust account. However, the proceeds deposited in the trust account could become subject to the claims of LCAA’s creditors, if any, which would have priority over the claims of LCAA shareholders. Therefore, the per share distribution from the trust account in such a situation may be less than originally expected due to such claims. It is expected that the funds to be distributed to LCAA Public Shareholders electing to redeem their LCAA Public Shares shall be distributed promptly after the consummation of the Business Combination.
Notwithstanding the foregoing, an LCAA Public Shareholder, together with any affiliate of such holder and any person with whom such holder is acting in concert or as a “group” ​(as defined under Section 13(d)(3) of the Exchange Act), may not seek to have more than 15% of the aggregate LCAA Public Shares redeemed. Additionally, the LCAA Articles contain a prohibition on redemptions of LCAA Public Shares in an amount that would cause LCAA’s net tangible assets to be less than $5,000,001 in connection with any vote held to approve a proposed business combination, which prohibition will apply in connection with the Business Combination Proposal unless the LCAA Articles are amended to remove such prohibition (whether pursuant to the NTA Amendment or otherwise).
Any request for redemption, once made by an LCAA Public Shareholder, may be withdrawn at any time up to two business days prior to the vote at Extraordinary General Meeting. After this time, a request for redemption may not be withdrawn once unless LCAA Board determines (in its sole discretion) to permit the withdrawal of such redemption request (which it may do in whole or in part). Such a request must be made by contacting Continental, LCAA’s transfer agent, at the phone number or address set out elsewhere in this proxy statement/prospectus.
No request for redemption shall be honored unless the holder’s share certificates (if any) or shares have been delivered (either physically or electronically) to Continental, LCAA’s transfer agent, in the manner described above, at least two business days prior to the vote at the Extraordinary General Meeting.
If you exercise your redemption rights, then you shall be exchanging your LCAA Public Shares for cash and shall not be entitled to receive any LTC Ordinary Shares in respect of such redeemed shares upon consummation of the Business Combination.
If you are a holder of LCAA Public Shares and you exercise your redemption rights, such exercise shall not result in the loss of any LCAA Warrants that you may hold.
The closing price of LCAA Public Shares on the record date was $      . The cash held in the trust account on such date was approximately $      million (approximately $      per LCAA Public Share). Prior to exercising redemption rights, LCAA Public Shareholders should verify the market price of LCAA Public Shares as they may receive higher proceeds from the sale of their LCAA Public Shares in the public market than from exercising their redemption rights if the market price per share is higher than the redemption price. LCAA cannot assure its shareholders that they shall be able to sell their LCAA Public Shares in the open market, even if the market price per share is higher than the redemption price stated above, as there may not be sufficient liquidity in its securities when its shareholders wish to sell their shares.
Appraisal or Dissenters’ Rights
No appraisal or dissenters’ rights are available to holders of LCAA Public Shares or LCAA Warrants in connection with the Business Combination Proposal. However, in respect of the special resolution to approve
 
47

 
the Merger Proposal, under section 238 of the Cayman Islands Companies Act, shareholders of a Cayman Islands company ordinarily have dissenters’ rights with respect to a statutory merger. In this proxy statement/prospectus, these dissenters’ rights are sometimes referred to as “Dissent Rights.”
The Cayman Islands Companies Act prescribes when dissenters’ rights will be available and provides that shareholders are entitled to receive fair value for their shares if they exercise those rights in the manner prescribed by the Cayman Islands Companies Act. Pursuant to section 239(1) of the Cayman Islands Companies Act, dissenters’ rights are not available if an open market for the shares exists on a recognized stock exchange for a specified period after the merger is authorized (such period being the period in which dissenter’s rights would otherwise be exercisable). It is anticipated that, if the Business Combination is approved, it may be consummated prior to the expiry of such specified period and accordingly the exemption under section 239(1) of the Cayman Islands Companies Act may not be available.
The Merger Agreement provides that, if any LCAA shareholder exercises Dissent Rights then, unless LCAA and LTC elect by agreement in writing otherwise, the First Merger shall not be consummated before the expiry date of the period allowed for written notice of an election to dissent in order to invoke the exemption under Section 239 of the Cayman Islands Companies Act. LCAA believes that such fair value would equal the amount that LCAA shareholders would obtain if they exercised their redemption rights as described herein. An LCAA shareholder which elects to exercise Dissent Rights must do so in respect of all of the LCAA Shares that person holds and will lose their right to exercise their redemption rights as described herein. See the section of this proxy statement/prospectus entitled “Extraordinary General Meeting of LCAA Shareholders — Appraisal Rights.”
LCAA shareholders are recommended to seek their own advice as soon as possible on the application and procedure to be followed in respect of the appraisal rights under the Cayman Islands Companies Act.
Proxy Solicitation
Proxies may be solicited by mail, telephone or in person. LCAA has engaged Morrow Sodali LLC to assist in the solicitation of proxies.
If a shareholder grants a proxy, it may still vote its LCAA Shares at the Extraordinary General Meeting by attending the Extraordinary General Meeting virtually by visiting                 , entering the control number on its proxy card and voting via the web portal during the Extraordinary General Meeting webcast. A shareholder may also change its vote by submitting a later-dated proxy as described in the section entitled “Extraordinary General Meeting of LCAA shareholders — Revoking Your Proxy.”
LCAA Board’s Reasons for the Approval of the Business Combination
In evaluating the Business Combination, LCAA and members of the LCAA Board consulted with its legal counsel and financial, accounting and other advisors, as well as members of Lotus Tech management. In determining that the terms and conditions of the Merger Agreement and the transactions contemplated thereby are in LCAA’s best interests, the LCAA Board considered and evaluated a number of factors, including, but not limited to, the factors discussed in the section referenced below. In light of the number and wide variety of factors considered in connection with its evaluation of the Merger Agreement and the transactions contemplated thereby, the LCAA Board did not consider it practicable to, and did not attempt to, quantify or otherwise assign relative weights to the specific factors that the LCAA Board considered in reaching its determination and supporting its decision. The LCAA Board viewed its decision as being based on all of the information available and the factors presented to and considered by the LCAA Board. In addition, individual directors may have given different weight to different factors. The LCAA Board realized that there can be no assurance about future results, including results considered or expected as disclosed in the following reasons. This explanation of the LCAA Board’s reasons for the Business Combination and all other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors discussed under “— Forward-Looking Statements.” The members of the LCAA Board are well qualified to evaluate the Business Combination. The LCAA Board and LCAA’s management collectively have extensive transactional experience, particularly in the consumer technology sectors.
The LCAA Board considered a wide variety of factors pertaining to the Merger Agreement and the transactions contemplated thereby. Before reaching its decision to approve the Business Combination, the
 
48

 
LCAA Board also considered the results of due diligence conducted by LCAA’s management and by LCAA’s legal, financial and other advisors, the different interests of LCAA’s officers and directors in the Business Combination, and a variety of uncertainties and risks and other potentially negative factors concerning the Business Combination.
The LCAA Board concluded that the potential benefits it expected LCAA and its shareholders to achieve as a result of the Business Combination outweighed the potentially negative factors associated with the Business Combination. Accordingly, the LCAA Board unanimously determined that the Merger Agreement and the Business Combination were advisable, fair and in the best interests of LCAA and its shareholders. See the section of this proxy statement/prospectus titled “The Business Combination — LCAA Board of Directors’ Reasons for the Business Combination.”
Interests of LCAA’s Directors and Officers in the Business Combination
In considering the recommendation of LCAA’s board of directors to vote in favor of approval of the Business Combination Proposal and the Merger Proposal, shareholders should keep in mind that the Sponsor and LCAA’s directors and officers have interests in such proposals that might be different from, or in addition to, those of LCAA’s shareholders generally. If LCAA does not complete the Business Combination with LTC or another business combination by the Business Combination Deadline, LCAA must redeem 100% of the outstanding LCAA Public Shares, at a per-share price, payable in cash, equal to an amount then held in the Trust Account (net of taxes payable and less up to US$100,000 of interest to pay dissolution expenses) divided by the number of outstanding LCAA Public Shares and, following such redemption, LCAA will liquidate and dissolve. As a result, and given the Sponsor’s interests in the Business Combination, the Sponsor may be incentivized to complete a business combination with a less favorable combination partner or on terms less favorable to LCAA Public Shareholders rather than fail to complete a business combination and be forced to liquidate and dissolve LCAA. In particular:

If the Business Combination with LTC or another business combination is not consummated by the Business Combination Deadline, LCAA will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding LCAA Public Shares for cash and, subject to the approval of its remaining shareholders and LCAA’s board of directors, dissolving and liquidating. In such event, the LCAA Founder Shares held by the Sponsor, which were acquired for an aggregate purchase price of US$25,000 prior to the IPO and a portion of which were transferred to the independent directors of LCAA as consideration for their service, are expected to be worthless because the holders are not entitled to participate in any redemption or distribution of proceeds in the Trust Account with respect to such shares. On the other hand, if the Business Combination is consummated, each outstanding LCAA Founder Share will be converted into one LTC Ordinary Share, subject to adjustment described herein.

If LCAA is unable to complete a business combination within the required time period, the Sponsor will be liable under certain circumstances described herein to ensure that the proceeds in the Trust Account are not reduced by the claims of target businesses or claims of vendors or other entities that are owed money by LCAA for services rendered to, contracted for or for products sold to LCAA. If LCAA consummates a business combination, on the other hand, LCAA will be liable for all such claims.

The Sponsor acquired the LCAA Founder Shares, which will be converted into LTC Ordinary Shares in connection with the Business Combination, for an aggregate purchase price of US$25,000 prior to the IPO and a portion of the LCAA Founder Shares were transferred to the independent directors of LCAA as consideration for their service. If unrestricted and freely tradeable, the 7,162,718 LCAA Founder Shares would have had an aggregate market value of US$       based on the closing price of US$       per share of LCAA Public Shares on Nasdaq on            , 2023, the most recent practicable date prior to the date of this proxy statement/prospectus, and an aggregate market value of US$       based on the closing price of US$       per share of LCAA Public Shares on Nasdaq on            , 2023, the record date. Alternatively, at the implied price per share of US$10 reflected in the Merger Agreement, the approximate dollar value of the LCAA Founder Shares would be US$71,627,180.
 
49

 

The Sponsor acquired the LCAA Private Warrants, which will be converted into LTC Warrants in connection with the Business Combination, for an aggregate purchase price of US$7.5 million. Based on the closing price of LCAA’s Public Warrants of US$          on Nasdaq on        , the record date for the extraordinary general meeting, the LCAA Private Warrants would be valued at US$             .

Given (i) the differential in the purchase price that the Sponsor paid for the LCAA Founder Shares as compared to the price of the LCAA Public Shares, (ii) the differential in the purchase price that the Sponsor paid for the LCAA Private Warrants as compared to the price of the LCAA Public Warrants, and (iii) the substantial number of LTC Ordinary Shares that the Sponsor will receive upon conversion of the LCAA Founder Shares and/or LCAA Private Warrants, the Sponsor and the other Founder Shareholders may earn a positive rate of return on their investment even if LTC Ordinary Shares trade below the price initially paid for the LCAA Units in the IPO and the LCAA Public Shareholders experience a negative rate of return following the completion of the Business Combination.

The Sponsor and LCAA’s officers and directors and their affiliates are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on LCAA’s behalf, such as identifying and investigating possible business targets and business combinations. However, if LCAA fails to consummate a business combination within the required period, they will not have any claim against the Trust Account for reimbursement. Accordingly, LCAA may not be able to reimburse these expenses if the Business Combination or another business combination is not completed by the Business Combination Deadline.

LCAA has provisions in the LCAA Articles waiving the corporate opportunities doctrine on an ongoing basis, which means that LCAA’s officers and directors have not been obligated and continue to not be obligated to bring all corporate opportunities to LCAA. While the provisions in the LCAA Articles waiving the corporate opportunities doctrine may have resulted in a potential conflict of interest as between the fiduciary duties or contractual obligations of LCAA’s officers and directors and the interests of LCAA and its shareholders, in practice it did not impact LCAA’s search for an initial business combination target, including LTC.

The Sponsor, as well as LCAA’s directors and officers, have agreed to waive their rights to liquidating distributions from the Trust Account with respect to the LCAA Founder Shares if LCAA fails to complete an initial business combination by the Business Combination Deadline.

The Founder Shareholders have agreed to waive their rights to conversion price adjustments with respect to any LCAA Founder Shares they may hold in connection with the consummation of the Business Combination and therefore, the LCAA Founder Shares will convert on a one-for-one basis into LTC Ordinary Shares at the Closing. None of the Founder Shareholders received any additional consideration for their waiver of the rights to liquidating distributions from the Trust Account or to conversion price adjustments with respect to any LCAA Founder Shares.

The Merger Agreement provides for the continued indemnification of LCAA’s current directors and officers and the continuation of directors and officers liability insurance covering LCAA’s current directors and officers.

LCAA’s Sponsor, affiliates of the Sponsor, officers and directors may make loans from time to time to LCAA to fund certain capital requirements. On January 11, 2021, the Sponsor agreed to loan LCAA an aggregate of up to US$300,000 to cover expenses related to the IPO pursuant to a promissory note. LCAA has not drawn down any amounts under the promissory note. In addition, in order to finance transaction costs in connection with an intended Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of LCAA’s officers and directors, may, but are not obligated to, loan LCAA funds as may be required (the “Working Capital Loans”). Up to $1,500,000 of the Working Capital Loans may be convertible into warrants of the post Business Combination entity at a price of $1.50 per warrant at the option of the lender. Additional loans may be made after the date of this proxy statement/prospectus. If the Business Combination is not consummated, any outstanding loans will not be repaid and will be forgiven except to the extent there are funds available to LCAA outside of the Trust Account.
 
50

 

LCAA entered into an agreement, commencing on the date its securities were first listed on Nasdaq and up to the earlier of the consummation of a business combination or its liquidation, to pay the Sponsor a monthly fee of US$10,000 for office space, secretarial and administrative support.

The Sponsor and the other Founder Shareholders have agreed to, among other things, vote all of their LCAA Shares in favor of the proposals being presented at the extraordinary general meeting in connection with the Business Combination and waive their redemption rights with respect to their LCAA Shares in connection with the consummation of the Business Combination. As of the date of this proxy statement/prospectus, on an as-converted basis, the Sponsor and the other Founder Shareholders own, collectively, approximately 24.74% of the issued and outstanding LCAA Shares.

Pursuant to the Merger Agreement, LCAA has the right to designate one director to the LTC Board post-Closing. Such director, in the future, may receive any cash fees, stock options or stock awards that the LTC Board determines to pay to its directors. LCAA has designated Anish Melwani to be a director on the LTC Board post-Closing. For more information regarding Anish Melwani, see the section titled “Management Following the Business Combination.”

The Founder Shareholders will enter into the Registration Rights Agreement at the Closing, which provides for registration rights of the Founder Shareholders following consummation of the Business Combination.

Pursuant to the Sponsor Support Agreement, 10% of the Sponsor Shares will remain unvested at the Closing and become vested upon the commencement or official announcement of the first Business Collaboration within two (2) years of the Closing, and all or a portion of (as reasonably determined by the Company in good faith) an additional 20% of the Sponsor Shares will remain unvested at the Closing and become vested upon each occurrence of (a) the commencement or official announcement of any additional Business Collaboration, or (b) an approved commitment to invest in the Company or one of its subsidiaries by an investor introduced or facilitated by Sponsor or its affiliate, in each case, within eighteen (18) months of the Closing. In connection with LCAA’s designation of Anish Melwani to serve as a director on the LTC Board post-Closing, the parties agreed that a Business Collaboration would occur upon the effectiveness of such appointment and as a result 10% of the Sponsor Shares will become vested immediately following the Closing.

In connection with the Extension Proposal, on March 22, 2023, the Sponsor deposited $990,000 into the Trust Account for the three-month extension of the Business Combination Deadline from March 15, 2023 to June 15, 2023 and to the extent a business combination is not consummated by LCAA by June 15, 2023, the Sponsor will deposit $330,000 for each subsequent one-month extension of the Business Combination Deadline from June 15, 2023 to March 15, 2024.
Recommendation to LCAA Shareholders
LCAA Board believes that each of the proposals to be presented at the Extraordinary General Meeting is fair to, and in the best interests of, LCAA and unanimously recommends that its shareholders vote “FOR” the NTA Proposal, “FOR” the Business Combination Proposal, “FOR” the Merger Proposal and “FOR” the Adjournment Proposal, if presented.
Emerging Growth Company
Each of LCAA and LTC is, and consequently, following the Business Combination, the combined company will be, an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such, the combined company will be eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in their periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find the combined company’s securities less attractive as a result, there may be a less active trading market for the combined company’s securities and the prices of the combined company’s securities may be more volatile.
 
51

 
The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards. Pursuant to the JOBS Act, the combined company has elected to take advantage of the benefits of this extended transition period for complying with new or revised accounting standards as required when they are adopted for public companies. As a result, the combined company’s operating results and financial statements may not be comparable to the operating results and financial statements of other companies who have adopted the new or revised accounting standards.
The combined company will remain an emerging growth company until the earlier of: (i) the last day of the fiscal year (a) following the fifth anniversary of the IPO, (b) in which LTC has total annual gross revenue of at least US$1.235 billion, or (c) in which the combined company is deemed to be a large accelerated filer, which means the market value of the combined company’s common equity that is held by non-affiliates exceeds US$700 million as of the last business day of its most recently completed second fiscal quarter; and (ii) the date on which the combined company has issued more than US$1.00 billion in non-convertible debt securities during the prior three-year period. References herein to “emerging growth company” have the meaning associated with it in the JOBS Act.
Foreign Private Issuer
LTC is a foreign private issuer within the meaning of the rules under the Exchange Act and, as such, LTC is permitted to follow the corporate governance practices of its home country, the Cayman Islands, in lieu of the corporate governance standards of Nasdaq applicable to U.S. domestic companies. For example, LTC is not required to have a majority of the board consisting of independent directors nor have a compensation committee or a nominating and corporate governance committee consisting entirely of independent directors. As a result, LTC’s shareholders may not have the same protection afforded to shareholders of U.S. domestic companies that are subject to Nasdaq corporate governance requirements. As a foreign private issuer, LTC is also subject to reduced disclosure requirements and are exempt from certain provisions of the U.S. securities rules and regulations applicable to U.S. domestic issuers such as the rules regulating solicitation of proxies and certain insider reporting and short-swing profit rules.
Controlled Company
By virtue of being a controlled company under Nasdaq listing rules, LTC may elect not to comply with certain Nasdaq corporate governance requirements, including that:

a majority of board of directors must be independent directors;

the compensation and nominating committees composed solely of independent directors;

the compensation of executive officers determined by a majority of the independent directors or a compensation committee composed solely of independent directors; and

director nominees selected or recommended to the board of directors for selection, either by a majority of the independent directors, or a nominating committee composed solely of independent directors.
LTC intends to rely on all of the foregoing exemptions available to a “controlled company.” As a result, its shareholders will not have the same protections afforded to shareholders of companies that are subject to all of Nasdaq’s corporate governance requirements.
Material U.S. Federal Income Tax Considerations
For a description of material U.S. federal income tax consequences of the Business Combination, the exercise of redemption rights in respect of LCAA Public Shares and the ownership and disposition of LTC Ordinary Shares, please see “Material Tax Considerations — Material U.S. Federal Income Tax Considerations to U.S. Holders.”
Anticipated Accounting Treatment
LTC has determined that it is the accounting acquirer based on its evaluation of the facts and circumstances of the acquisition. The purpose of the merger was to assist LTC with the refinancing and
 
52

 
recapitalization of its business. LTC is the larger of the two entities and is the operating company within the combining companies. LTC will have control of the board as it will hold a majority of the seats on the board of directors with LCAA only taking one seat in the board members after the Mergers. LTC’s senior management will be continuing as senior management of the combined company. In addition, a larger portion of the voting rights in the combined entity will be held by existing LTC’s shareholders.
As LTC was determined to be the acquirer for accounting purposes, the accounting for the transaction will be similar to that of a capital infusion as the only significant pre-combination asset of LCAA is the cash in the Trust Account. No intangibles or goodwill will arise through the accounting for the transaction. The accounting is the equivalent of LTC issuing shares and warrants for the net monetary assets of LCAA.
Risk Factor Summary
You should consider all the information contained in this proxy statement/prospectus in deciding how to vote for the proposals presented in this proxy statement/prospectus. In particular, you should consider the risk factors described under “Risk Factors” beginning on page 80 of this proxy statement/prospectus. Such risks include, but are not limited to:
Risks Relating to Our Business and Industry

The automotive market is highly competitive, and we may not be successful in competing in this industry.

Our reliance on a variety of arrangements with Geely Holding, including agreements related to research and development, procurement, manufacturing, and engineering, could subject us to risks.

We may not succeed in continuing to maintain and strengthen our brand, and our brand and reputation could be harmed by negative publicity with respect to us, our directors, officers, employees, shareholders, peers, business partners, or our industry in general.

We have a limited operating history and our ability to develop, manufacture, and deliver automobiles of high quality and appeal to customers, on schedule, and on a large scale is unproven and still evolving.

We have not been profitable and had negative net cash flows from operations. If we do not effectively manage our cash and other liquid financial assets, execute our plan to increase profitability and obtain additional financing, we may not be able to continue as a going concern.

Forecasts and projections of our operating and financial results relies in large part upon assumptions and analyses developed by our management. If these assumptions or analyses prove to be incorrect, our actual operating results may be materially different from those forecasted or projected.

We have received a limited number of orders for Eletre, some of which may be cancelled by customers despite their deposit payment and online confirmation.

We currently depend on revenues generated from a limited number of vehicle models.
Risks Relating to Doing Business in China

The PRC government has significant oversight over our business and authority to influence and intervene our operations as the government deems appropriate to advance regulatory and societal goals and policy positions. Any actions by the PRC government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline. For more details, see “Risk Factors — Risks Related to Doing Business in China — Failure to meet the PRC government’s complex regulatory requirements on and significant oversight over our business operation could result in a material adverse change in our operations and the value of our securities.”

We may be adversely affected by the complexity, uncertainties and changes in regulations of mainland China on automotive as well as internet-related businesses and companies.

The approval of and filing with the CSRC or other PRC government authorities is required in connection with this Business Combination or our listing under laws of mainland China. However, we
 
53

 
cannot predict whether or when we will be able to obtain such approval or complete such filing, and even if we obtain such approval, it could be rescinded. Any failure to or delay in obtaining such approval or complying with such filing requirements in relation to offering, or a rescission of such approval, could subject us to sanctions imposed by the CSRC or other PRC government authorities.

The PCAOB had historically been unable to inspect our auditor in relation to their audit work.

Our securities may be prohibited from trading in the United States under the Holding Foreign Companies Accountable Act, or the HFCAA, if the PCAOB is unable to inspect or investigate completely auditors located in China. The delisting of our securities, or the threat of their being delisted, may materially and adversely affect the value of your investment.

Risks and uncertainties arising from the legal system of mainland China, including risks and uncertainties regarding the interpretation and enforcement of laws and quickly evolving rules and regulations in mainland China, could result in a material adverse change in our operations and the value of its securities. For more details, see “Risk Factors — Risks Related to Doing Business in China — Uncertainties with respect to the legal system and changes in laws and regulations in mainland China could adversely affect us.”

We are subject to laws and regulations of mainland China restricting capital flows which may affect our liquidity. See “Risk Factors — Risks Related to Doing Business in China — We may rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business” and “— Regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from making loans to or make additional capital contributions to our PRC subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.”
Risks Relating to Intellectual Property and Legal Proceedings

We may need to defend ourselves against intellectual property right infringement, misappropriation, or other claims, which may be time-consuming and would cause us to incur substantial costs.

We may not be able to prevent others from unauthorized use of our intellectual property, which could harm our business and competitive position.

As our patents may expire and may not be extended, our patent applications may not be granted, and our patent rights may be contested, circumvented, invalidated, or limited in scope, our patent rights may not protect us effectively. In particular, we may not be able to prevent others from developing or exploiting competing technologies, which could materially and adversely affect our business, financial condition, and results of operations.
For additional detail on these and other risks, see “Risk Factors” starting on page 80 of this proxy statement/prospectus.
 
54

 
SELECTED HISTORICAL FINANCIAL DATA OF LOTUS TECH
The following tables present the selected consolidated and combined financial data of Lotus Tech. Lotus Tech prepares its consolidated and combined financial statements in accordance with U.S. GAAP. The selected consolidated and combined statements of comprehensive loss data for the six months ended June 30, 2023 and 2022, the selected consolidated balance sheet data as of June 30, 2023 and the selected consolidated and combined statements of cash flows data for the six months ended June 30, 2023 and 2022 are derived from our unaudited condensed consolidated and combined financial statements included elsewhere in this proxy statement/prospectus. The selected consolidated and combined statements of comprehensive loss data for the years ended December 31, 2022 and 2021, the selected consolidated and combined balance sheets data as of December 31, 2022 and 2021, and the selected consolidated and combined statements of cash flows data for the years ended December 31, 2022 and 2021 have been derived from Lotus Tech’s audited consolidated and combined financial statements for the years ended December 31, 2022 and 2021, which are included elsewhere in this proxy statement/prospectus. Lotus Tech’s historical results for any prior period are not necessarily indicative of results expected in any future period.
The financial data set forth below should be read in conjunction with, and is qualified by reference to “Lotus Tech’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated and combined financial statements and notes thereto included elsewhere in this proxy statement/prospectus.
Selected Consolidated and Combined Statements of Comprehensive Loss Data
For the Six Months Ended June 30,
For the Year Ended December 31,
2023
2022
2022
2021
US$
%
US$
%
US$
%
US$
%
(in thousands, except percentages)
Revenues
Sales of goods
124,854 96.0 549 22.7 1,186 12.4 369 10.0
Service revenues
5,181 4.0 1,870 77.3 8,371 87.6 3,318 90.0
Total revenues
130,035 100.0 2,419 100.0 9,557 100.0 3,687 100.0
Cost of revenues
Cost of goods sold
(119,557) (91.9) (466) (19.3) (948) (9.9) (331) (9.0)
Cost of services
(4,351) (3.3) (1,342) (55.5) (6,302) (65.9) (2,799) (75.9)
Total cost of revenues
(123,908) (95.3) (1,808) (74.7) (7,250) (75.9) (3,130) (84.9)
Gross profit
6,127 4.7 611 25.3 2,307 24.1 557 15.1
Operating expenses
Research and development expenses
(152,548)<