Financial Overview - The company completed its initial public offering (IPO) on December 11, 2020, raising gross proceeds of $300 million from the sale of 30,000,000 units at $10.00 per unit[10]. - As of December 31, 2022, the trust account held approximately $16,975,796 in cash[13]. - Following redemptions at the June Special Meeting, approximately $50,600,000 remained in the trust account after stockholders redeemed 24,944,949 shares at about $10.01 per share[14]. - After the October Special Meeting, approximately $16,810,087 remained in the trust account after stockholders redeemed 3,382,949 shares at about $10.05 per share[17]. - As of December 31, 2022, the estimated redemption price for public shares was $10.15 per share[33]. - As of December 31, 2022, the company had $760 available outside of the trust account to fund working capital requirements, which may not be sufficient to operate until April 11, 2023[68]. - As of December 31, 2022, the company has approximately $17 million in the trust account available for completing its initial business combination, excluding $10.5 million of deferred underwriting commissions[100]. Business Combination Requirements - The company intends to effectuate its initial business combination using cash held in the trust account and may also utilize proceeds from the sale of shares or debt issued to lenders[21]. - The company must complete a business combination with an aggregate fair market value of at least 80% of the assets held in the trust account[24]. - The per-share redemption price for public stockholders upon consummation of the initial business combination is expected to be approximately $10.00, net of interest available for taxes[29]. - The company will have until April 11, 2023, to complete its initial business combination, or it will redeem public shares at a price equal to the aggregate amount in the trust account divided by the number of outstanding public shares[36]. - If the company does not complete the initial business combination by the deadline, it will cease operations, redeem public shares, and liquidate[36]. - The company is prohibited from completing a business combination with another blank check company or similar entity with nominal operations[23]. Stockholder Dynamics - Public stockholders are restricted from redeeming more than 20% of the shares sold in the initial public offering, referred to as "Excess Shares"[35]. - The company’s initial stockholders have agreed to vote in favor of the initial business combination, regardless of public stockholder votes[41]. - Initial stockholders own approximately 82% of the outstanding common stock, which may influence the approval of the initial business combination regardless of public stockholder votes[45]. - The company must provide public stockholders with the opportunity to redeem their shares for cash if amendments to the charter are proposed, particularly regarding the obligation to redeem 100% of public shares by April 11, 2023[109]. - The absence of a specified maximum redemption threshold may allow the company to complete a business combination even if a substantial majority of stockholders do not agree[106]. Risks and Challenges - The company may face competition from other entities with similar business objectives, which may limit its ability to acquire larger target businesses[37]. - The ability of public stockholders to redeem shares may make the company less attractive to potential business combination targets[41]. - The company may face challenges in completing a business combination due to the ongoing impacts of the COVID-19 pandemic, which has affected economies and financial markets globally[53]. - If too many public stockholders exercise their redemption rights, the company may not meet the minimum cash requirement for a business combination, which could hinder potential deals[47]. - Claims by third parties could reduce the proceeds held in the trust account, potentially lowering the per-share redemption amount for stockholders[70]. - The company may incur substantial debt to complete a business combination, which could negatively impact the financial condition and value of stockholders' investments[97]. - The company may face limitations in acquiring target businesses due to federal proxy rules requiring detailed financial statement disclosures[120]. - The company may face uncertainty in completing a business combination due to potential regulatory actions and investor concerns affecting target businesses[127]. Management and Governance - The company has not adopted a policy to prohibit directors and officers from having financial interests in transactions, which may lead to conflicts of interest[151]. - The personal and financial interests of executive officers and directors may influence their motivation in selecting a target business for the initial business combination[157]. - The executive officers and directors are not required to commit full time to the company's affairs, leading to potential conflicts of interest[149]. - The management team may not have sufficient funds to satisfy indemnification claims, which could discourage litigation against them[144]. - The company may pursue business combinations with entities affiliated with its Sponsor, executive officers, or directors, which could raise potential conflicts of interest[155]. Regulatory and Compliance Issues - The company received a deficiency notice from Nasdaq on January 9, 2023, for failing to hold an annual meeting within the required timeframe[19]. - Compliance with the Sarbanes-Oxley Act may increase the time and costs associated with completing the initial business combination[121]. - Changes in laws or regulations may adversely affect the company's ability to negotiate and complete its initial business combination[84]. - If deemed an investment company under the Investment Company Act, the company may be forced to liquidate instead of completing an initial business combination[81]. Securities and Financial Instruments - The company has authorized the issuance of up to 280,000,000 shares of Class A common stock, with currently 1,672,102 shares issued and outstanding[174]. - The company issued 15,000,000 warrants as part of the units sold in the initial public offering, with an additional 8,000,000 private placement warrants issued at $11.50 per share[183]. - The potential issuance of additional shares upon the exercise of warrants could dilute the equity interest of existing investors and affect the market price of Class A common stock[176]. - The company may issue additional shares of Class A common stock or preferred stock to complete its initial business combination, which could further dilute existing shareholders[176]. - The company's warrants are accounted for as derivative liabilities, which may lead to fluctuations in financial results based on changes in fair value[202][203]. Market and Trading Considerations - If the company is delisted from Nasdaq, its securities may be quoted on an over-the-counter market, leading to reduced liquidity and trading activity[162]. - The company is not currently registering the Class A common stock issuable upon exercise of the warrants under the Securities Act, which may limit the ability of warrant holders to exercise their warrants[167]. - The company will use its best efforts to file a registration statement for the Class A common stock within 15 business days after the initial business combination[167].
Altitude Acquisition (ALTU) - 2022 Q4 - Annual Report