Cepton(CPTN) - 2021 Q4 - Annual Report

Part I Business Growth Capital Acquisition Corp. is a SPAC targeting business combinations with companies valued between $300 million and $1.5 billion, with a deadline of August 2, 2022 - The company is a blank check company whose purpose is to effect an initial business combination with a target that has an enterprise value between approximately $300 million and $1.5 billion[18] Initial Public Offering Details | Metric | Value | | :--- | :--- | | IPO Date | February 2, 2021 | | Units Offered | 17,250,000 | | Price per Unit | $10.00 | | Gross Proceeds (IPO) | $172,500,000 | | Private Placement Warrants | 5,175,000 | | Gross Proceeds (Warrants) | $5,175,000 | | Amount in Trust Account | $172,500,000 | - The company must complete its initial business combination by August 2, 2022, or it will terminate its existence and distribute the funds held in the trust account[23][114] - The management team, Prokopios Tsirigakis and George Syllantavos, have successfully founded and completed business combinations for three prior blank check companies: Stellar Acquisition III Inc., Nautilus Marine Acquisition Corp., and Star Maritime Acquisition Corp[24] - The company's sponsor, Growth Capital Sponsor LLC, is an affiliate of Maxim Group LLC, a global investment bank that has significant experience in the SPAC market, having been involved in over 30% of SPAC IPOs since 2002[26][29] Risk Factors The company faces significant risks including the deadline to complete a business combination, competition, conflicts of interest, and a material weakness in warrant accounting - The company must complete its initial business combination by August 2, 2022, or it will be forced to cease operations, redeem public shares, and liquidate, rendering its warrants worthless[155][156] - The ability of public stockholders to redeem a large number of shares could make the company's financial condition unattractive to targets or prevent the completion of a desirable business combination[147][149] - The sponsor, officers, and directors will lose their entire investment in founder shares and private placement warrants if a business combination is not completed, creating a potential conflict of interest when evaluating a target business[226][227] - The company's operations may be adversely affected by the COVID-19 pandemic, which could restrict travel, limit meetings, and impact the ability to raise necessary financing for a transaction[159][160] - A material weakness was identified in the company's internal control over financial reporting due to the re-evaluation of the accounting treatment for its warrants as liabilities instead of equity, following an SEC Staff Statement[346][347][348] Unresolved Staff Comments The company reports no unresolved staff comments from the Securities and Exchange Commission - Not applicable[349] Properties The company's executive offices are provided by its sponsor for a monthly fee of $5,750, covering office space and administrative support - The company's executive offices are provided by its sponsor for a monthly fee of $5,750[350] Legal Proceedings The company reports no material litigation or governmental proceedings pending against it or its management - There is no material litigation currently pending against the company or its management[351] Mine Safety Disclosures This section is not applicable to the company - Not applicable[353] Part II Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities The company's securities trade on NASDAQ, with no cash dividends planned before a business combination, and details initial share and warrant sales - The company's securities are traded on the NASDAQ Capital Market under the symbols GCACU (units), GCAC (public shares), and GCACW (public warrants)[356] - The company has not paid any cash dividends and does not plan to before the initial business combination[359] - On February 2, 2021, the company consummated its IPO of 17,250,000 units at $10.00 per unit, generating gross proceeds of $172,500,000, with a total of $172,500,000 placed in a trust account[364][365] Selected Financial Data This section is not applicable to the company - Not applicable[367] Management's Discussion and Analysis of Financial Condition and Results of Operations As a blank check company with no operations, the company reported an $8.26 million net income primarily from warrant fair value changes, with a business combination deadline of August 2, 2022 - The company is a blank check company with no operations or revenues to date, with activities limited to organizational matters and preparing for its IPO[369][376] - For the period from inception (January 4, 2010) through March 31, 2021, the company had a net income of $8,261,624, which was mainly attributed to changes in the fair value of its warrants[377] - As of March 31, 2021, the company had cash of $749,737 available for working capital, with $172,500,000 held in the trust account from the IPO and private placement proceeds[379][381] - The company accounts for its warrants as a liability at fair value, subject to re-measurement each reporting period, with changes in fair value recognized in the statement of operations, which is a critical accounting policy[390][391] - Class A common stock subject to possible redemption is classified as temporary equity on the balance sheet[392] Quantitative and Qualitative Disclosures About Market Risk Funds in the trust account are invested in short-term U.S. government treasury bills or money market funds, mitigating material interest rate risk - Proceeds held in the trust account are invested in short-term U.S. government treasury bills or money market funds, leading to the belief that there is no material exposure to interest rate risk[396] Financial Statements and Supplementary Data This section presents the audited financial statements for March 31, 2021, highlighting the reclassification of warrants from equity to liability Balance Sheet Summary (as of March 31, 2021) | Account | Amount (USD) | | :--- | :--- | | Assets | | | Cash | 749,737 | | Investments held in Trust Account | 172,505,514 | | Total Assets | 173,370,188 | | Liabilities & Equity | | | Warrant liability | 7,141,500 | | Total liabilities | 7,215,256 | | Class A common stock subject to redemption | 161,154,930 | | Total shareholders' equity | 5,000,002 | Statement of Operations Summary (for the year ended March 31, 2021) | Account | Amount (USD) | | :--- | :--- | | Loss from operations | (93,265) | | Unrealized gain on FV changes of warrants | 9,936,000 | | Net income | 8,261,624 | | Basic and diluted net income per share, Class B | 1.78 | - The company revised its previously issued financial statements to reclassify public and private placement warrants as derivative liabilities instead of equity, following the SEC Staff Statement on April 12, 2021[548][550] Changes in and Disagreements with Accountants on Accounting and Financial Disclosure The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[400] Controls and Procedures Management concluded disclosure controls were ineffective due to a material weakness in warrant accounting, leading to reclassification from equity to liabilities - Management concluded that disclosure controls and procedures were not effective as of March 31, 2021[401] - A material weakness was identified related to the accounting classification of the company's warrants, prompted by the SEC Staff Statement issued on April 12, 2021, which led to the reclassification of warrants as liabilities[401][402] Other Information The company reports no other information - None[408] Part III Directors, Executive Officers and Corporate Governance The company's governance includes experienced co-CEOs, a five-member board with independent directors, established committees, and disclosed potential conflicts of interest - The executive team includes Prokopios (Akis) Tsirigakis (President, Chairman, Co-CEO) and George Syllantavos (Co-CEO, CFO), who have prior experience founding three SPACs that successfully completed business combinations[409] - The board of directors consists of five members, with Harry Braunstein, Gary Leibler, and Evan Breibart serving as independent directors[409][432] - Significant conflicts of interest exist as officers and directors have fiduciary or contractual obligations to other entities and may be required to present business opportunities to those entities before presenting them to the company[418][428] - The company has established an audit committee and a compensation committee, both composed of independent directors[434][435][439] Executive Compensation No cash compensation is paid to officers or directors prior to a business combination, except for a $5,750 monthly fee for administrative support - No officers have received cash compensation for services rendered, and no compensation will be paid to officers, directors, or the sponsor prior to the consummation of the initial business combination, other than reimbursements for out-of-pocket expenses[452] - The company pays its sponsor's affiliate $5,750 per month for office space, utilities, and administrative support[452] Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters As of July 16, 2021, the company had 21,562,500 common shares outstanding, with initial stockholders owning 20% of total shares Beneficial Ownership as of July 16, 2021 | Beneficial Owner | Class B Shares | % of Class B | % of Total Common Stock | | :--- | :--- | :--- | :--- | | Growth Capital Sponsor LLC | 1,367,500 | 31.71% | 6.34% | | Prokopios Tsirigakis (via Nautilus) | 1,367,500 | 31.71% | 6.34% | | George Syllantavos (via Nautilus) | 1,367,500 | 31.71% | 6.34% | | Hudson Bay (HB Strategies) | 1,367,500 | 31.71% | 9.82% (incl. Class A shares) | | All officers and directors as a group | 1,457,501 | 33.80% | 6.76% | - The ownership percentages are based on 17,250,000 Class A shares and 4,312,500 Class B shares outstanding[458] Certain Relationships and Related Transactions, and Director Independence Related party transactions include founder share sales, a monthly administrative fee, potential working capital loans, and a 3.5% marketing fee to a sponsor affiliate - The sponsor, Nautilus, and HB Strategies purchased an aggregate of 5,175,000 private placement warrants for $5,175,000 simultaneously with the IPO[469] - The company pays an affiliate of the sponsor $5,750 per month for office space and administrative services[472] - The sponsor or its affiliates may provide up to $1,500,000 in working capital loans, which may be convertible into warrants at $1.00 per warrant[475] - Maxim Group LLC is engaged as an advisor and will receive a business combination marketing fee equal to 3.5% of the gross IPO proceeds ($6,037,500) upon consummation of a deal[611] - The board of directors has determined that Messrs. Braunstein, Leibler, and Breibart are independent directors[487] Principal Accountant Fees and Services Marcum LLP, the independent auditor, billed $54,541 in audit fees for the period ending March 31, 2021, with no other fees for related services Accountant Fees (Marcum LLP) | Fee Category | Amount (USD) | | :--- | :--- | | Audit Fees | $54,541 | | Audit-Related Fees | $0 | | Tax Fees | $0 | | All Other Fees | $0 | - All auditing and permitted non-audit services are pre-approved by the audit committee[497] Part IV Exhibits, Financial Statement Schedules This section indexes financial statements and various corporate and offering-related agreements filed as exhibits to the report - This section provides an index to the financial statements and lists all exhibits filed with the report, including key corporate and offering-related agreements[501][502] Form 10-K Summary This section is not applicable - Not applicable[503]