Global Partner Acquisition II(GPAC) - 2022 Q4 - Annual Report

PART I Item 1. Business The company is a blank check entity formed to effect a business combination, targeting the space and wireless technology sectors Overview The company is a blank check entity formed in 2020 targeting a business combination in the technology sector - The company is a blank check company incorporated in November 2020, aiming for an initial business combination with an enterprise value between $500 million and $3.0 billion[22][23] - Target industry sectors include space and wireless technologies, data infrastructure, data analytics, and big data, as well as related service sectors undergoing technology-driven transformation[23] - On January 13, 2023, an Investment Agreement was entered into, leading to a change of control of the Sponsor to affiliates of Antarctica Capital Partners, LLC, and the appointment of new officers[27] Business Strategy The strategy leverages an experienced management team, value-added partners, and an efficient SPAC structure - The business strategy is built on three pillars: an experienced management team led by Chandra R. Patel, value-added partners in the sponsor, and an efficient APEX™ SPAC structure[31] - The combined team's expertise in space and wireless technologies, along with a proprietary deal-sourcing network, is expected to facilitate sourcing, execution, and value addition to target companies[31][32][33] Acquisition Criteria The company seeks targets with growth potential, operational improvement opportunities, and benefits from technology-driven change - Target companies should exhibit characteristics such as opportunities for value-added capital for growth/consolidation, potential for operational improvements, suitability for a 'Partnership' sale, and benefits from technology-driven change[38][41] - The company may consider targets outside its stated industry focus if they offer attractive opportunities, and will disclose if a target does not meet the general criteria[39] Initial Business Combination The initial business combination must meet a minimum fair market value threshold and typically involves acquiring a controlling interest - The initial business combination must have an aggregate fair market value of at least 80% of the assets in the trust account (excluding deferred underwriting commissions and taxes), if listed on Nasdaq[42] - The company aims to own or acquire 100% of the target's equity or assets, or at least a controlling interest (50% or more of voting securities)[43] Acquisition Process The process involves comprehensive due diligence, management of potential conflicts, and incentives for shareholder retention - The acquisition process involves due diligence, including financial analysis, document reviews, management meetings, and expert consultations[46] - Potential conflicts of interest exist if the target is affiliated with management or the sponsor, requiring an independent financial fairness opinion[47][48] - Distributable redeemable warrants are designed to incentivize public shareholders not to redeem their Class A ordinary shares during the business combination[52] Status as a Public Company The company's public status offers targets an alternative to a traditional IPO but includes reduced reporting requirements - Being an existing public company offers target businesses an alternative to a traditional IPO, providing liquidity, capital access, and enhanced profile[53][54] - The company is an 'emerging growth company' and 'smaller reporting company,' allowing it to take advantage of certain exemptions from reporting requirements, which may affect investor attractiveness[56][57][58] Financial Position Recent redemptions significantly reduced the trust account balance available for a business combination - Initially, approximately $289.5 million was available for a business combination; however, after redemptions on January 11, 2023, the balance in the trust account was reduced to approximately $40.4 million[59] Effecting Our Initial Business Combination The company has flexibility in structuring consideration for a business combination but faces risks post-acquisition - The company intends to use cash from IPO proceeds, private placement warrants, equity, or debt for its initial business combination, with flexibility to tailor consideration[60] - Target businesses are sourced from various unaffiliated and affiliated channels, including investment market participants, private equity groups, and the management team's network[64] - Risks include lack of business diversification post-combination and limited ability to evaluate target management, potentially impacting future performance[69][70][73] Shareholders May Not Have the Ability to Approve Our Initial Business Combination The company may proceed with a business combination without a shareholder vote, limiting investor influence - The company may conduct redemptions without a shareholder vote if not required by law or Nasdaq listing rules, limiting shareholders' direct influence on the business combination decision[74] - Sponsor, directors, executive officers, advisors, or their affiliates may purchase public shares or warrants in privately negotiated transactions to influence a vote or meet closing conditions[75][76][78] Redemption Rights for Public Shareholders upon Completion of Our Initial Business Combination Public shareholders have redemption rights for their shares, while the sponsor and management have waived theirs - Public shareholders have the right to redeem Class A ordinary shares for cash at a per-share price from the trust account upon completion of the initial business combination[82] - The sponsor and management team have waived their redemption rights for founder shares and public shares they hold[82] Distribution of Distributable Redeemable Warrants to Holders of Class A Ordinary Shares Not Electing Redemption Non-redeeming shareholders will receive distributable redeemable warrants as an incentive - Holders of non-redeemed public shares will receive one-sixth of one distributable redeemable warrant per share, while redeemed shares will not receive any[84][85] - These warrants are identical to detachable redeemable warrants and will become tradable upon distribution[86] Limitations on Redemptions Redemptions are limited to maintain a minimum net tangible asset value and ensure sufficient cash for the transaction - Redemptions are limited such that net tangible assets must not fall below $5,000,001 to avoid SEC 'penny stock' rules[87] - If aggregate cash required for redemptions and business combination conditions exceeds available cash, the combination will not proceed[87] Manner of Conducting Redemptions Redemptions can be conducted through a shareholder meeting or a tender offer, with the sponsor committed to a favorable vote - Redemptions can be conducted either in connection with a shareholder meeting (proxy solicitation) or via a tender offer[88] - If shareholder approval is sought, the business combination requires an ordinary resolution (majority vote), and the sponsor has agreed to vote its shares in favor[91] Limitation on Redemption upon Completion of Our Initial Business Combination If We Seek Shareholder Approval A 15% cap on redemptions by any single shareholder aims to prevent undue influence on the transaction - Public shareholders are restricted from redeeming more than 15% of the shares sold in the IPO ('Excess Shares') without prior consent, to prevent large block holders from unduly influencing the transaction[96] Tendering Share Certificates in Connection with a Tender Offer or Redemption Rights Shareholders must tender certificates to exercise redemption rights, making the decision irrevocable post-approval - Shareholders exercising redemption rights must tender their certificates (physically or electronically) to the transfer agent prior to the specified date, making the election irrevocable once the business combination is approved[98][100] Redemption of Public Shares and Liquidation If No Initial Business Combination Failure to complete a business combination by the deadline will result in liquidation and redemption of public shares - If an initial business combination is not consummated by the Termination Date (January 14, 2024), the company will cease operations, redeem public shares at a pro-rata trust account value, and liquidate[104] - In such a liquidation, warrants will expire worthless, and no distributable redeemable warrants will be issued[104] - The sponsor has agreed to be liable for third-party claims that reduce the trust account below $10.00 per public share, provided waivers were not executed or are unenforceable[109] Competition The company faces intense competition for acquisition targets from various financial and strategic entities - The company faces intense competition from other blank check companies, private equity groups, and operating businesses for acquisition opportunities[114] - Limited financial resources and redemption obligations may put the company at a competitive disadvantage[114] Employees The company operates with executive officers and no full-time employees prior to a business combination - The company currently has four executive officers and no full-time employees, relying on them to devote necessary time to its affairs until a business combination is completed[115] Periodic Reporting and Financial Information The company adheres to SEC reporting obligations but benefits from reduced disclosure requirements as an emerging growth company - As a public company, it has SEC reporting obligations, including filing annual, quarterly, and current reports with audited financial statements[116] - The company is an 'emerging growth company' and 'smaller reporting company,' allowing for reduced disclosure obligations and an extended transition period for new accounting standards[121][122][124] Item 1A. Risk Factors The company faces significant risks related to consummating a business combination, sponsor conflicts, and regulatory compliance Summary of Risk Factors Investment carries high risk due to a lack of operating history and uncertainties surrounding the business combination - Investment in the company's securities involves a high degree of risk due to its lack of operating history and revenues[126][127] - Key risks include the potential for shareholders not to vote on a business combination, the impact of redemption rights on financial condition, the deadline for consummating a business combination, and the influence of the sponsor[127][128] Risks Relating to our Search for, Consummation of, or Inability to Consummate a Business Combination and Post-Business Combination Risks The company faces numerous risks in finding and completing a business combination, including financial, competitive, and market-related challenges - The company may complete an initial business combination without shareholder approval, and the sponsor's agreement to vote in favor increases the likelihood of approval[131][132] - Shareholder redemption rights can make the company's financial condition unattractive to targets and may limit the ability to complete desirable combinations or optimize capital structure[134][135] - The requirement to consummate a business combination by the Termination Date (January 14, 2024) may give target businesses leverage and limit due diligence time[137] - The company's negative working capital and deadline for a business combination raise substantial doubt about its ability to continue as a going concern[138] - Intense competition from other SPACs and entities may increase acquisition costs or prevent finding a suitable target[139][140] - The ongoing effects of the COVID-19 pandemic and the status of debt and equity markets may adversely affect the search for and consummation of a business combination[143][144] - If the company fails to consummate a business combination by the Termination Date, public shareholders may receive less than $10.00 per share, and warrants will expire worthless[146] - The company's charter allows amendments to shareholder rights with a two-thirds vote, which is a lower threshold than some other blank check companies, potentially facilitating combinations shareholders may not support[152][153] - Incurring substantial debt to complete a business combination could adversely affect leverage and financial condition[166][167] - Lack of business diversification post-combination, if only one target is acquired, may negatively impact operations and profitability[169][170] - Third-party claims against the trust account could reduce the per-share redemption amount for public shareholders[179][180] Risks Relating to our Sponsor and Management Team Potential conflicts of interest arise from the management team's other obligations and the sponsor's financial incentives - The company's success is highly dependent on its key personnel, and their loss could negatively impact operations[198][200] - Key personnel may negotiate employment or consulting agreements with a target business, potentially creating conflicts of interest in selecting a business combination[202][203] - The sponsor, executive officers, and directors have a significant financial incentive to complete a business combination, as their initial investment would be lost otherwise, potentially leading to conflicts of interest[204][251] - Officers and directors allocate time to other businesses, which may cause conflicts of interest and negatively impact the ability to complete a business combination[205][206] - The sponsor controls a substantial interest (65.6% post-redemption) in the company, allowing it to exert significant influence on shareholder votes and director appointments[211] Risks Relating to Our Securities The company's securities face risks including potential delisting, dilution, and regulatory classification challenges - If deemed an investment company under the Investment Company Act, the company would face burdensome compliance requirements and restricted activities, hindering its ability to complete a business combination[214][215][216][217] - Shareholders holding more than 15% of Class A ordinary shares may lose the ability to redeem excess shares, reducing their influence and potentially leading to losses[218] - Nasdaq may delist the company's securities if it fails to meet listing standards, limiting investor transactions and potentially subjecting it to additional trading restrictions[219][220][221] - Issuance of additional Class A ordinary shares or preference shares, or conversion of founder shares, could significantly dilute existing investors' equity interest[224][226][227] - Warrants are accounted for as derivative liabilities, and changes in their fair value will fluctuate quarterly, potentially affecting earnings and market price[233] - The nominal purchase price paid by the sponsor for founder shares results in immediate and substantial dilution for Class A ordinary shareholders[249][250] Additional Risk Factors The company faces operational, legal, and cybersecurity risks due to its structure and lack of operating history - The company has no operating history or revenues, providing no basis to evaluate its ability to achieve its business objective[253] - Cyber incidents or attacks could result in information theft, data corruption, operational disruption, and/or financial loss[255] - Changes in laws or regulations, or non-compliance, may adversely affect the business, including the ability to complete a business combination[258][259][260] - Compliance obligations under the Sarbanes-Oxley Act may make it more difficult and costly to effectuate a business combination, especially with a target not in compliance[261] - As a Cayman Islands exempted company, investors may face difficulties in protecting their interests and enforcing legal rights through U.S. federal courts[272][273][275][276] Risks Associated with Acquiring and Operating a Business in Foreign Countries Acquiring a foreign business introduces risks related to regulations, currency, and political instability - Pursuing a target with foreign operations subjects the company to additional risks, including cross-border due diligence, regulatory approvals, and foreign exchange rate fluctuations[281] - Operating in an international setting involves risks such as managing cross-border operations, currency regulations, complex taxes, and political/economic instability[282][283] - If management post-business combination is unfamiliar with U.S. securities laws, it could lead to regulatory issues and increased time/resources[286] Recent Economic and Geopolitical Risks Inflation and geopolitical conflicts may disrupt markets and hinder the completion of a business combination - Recent increases in inflation and the conflict in Ukraine could lead to increased price volatility for securities and economic disruptions, making it harder to consummate a business combination[290][291] Item 1B. Unresolved Staff Comments The company has no unresolved comments from the Securities and Exchange Commission staff - No unresolved staff comments[292] Item 2. Properties The company operates remotely without physical facilities, maintaining a principal executive office in New York - The company has no physical facilities; officers and investment professionals work remotely[293] - The principal executive office address is 200 Park Avenue 32nd Floor, New York, NY 10166[3] Item 3. Legal Proceedings The company is not currently involved in any material legal proceedings - No material litigation, arbitration, or governmental proceeding is currently pending against the company or its management[294] Item 4. Mine Safety Disclosures This section is not applicable as the company is not engaged in mining operations - Mine Safety Disclosures are not applicable[295] PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The company's securities trade on Nasdaq, with no dividends paid and a significant recent share redemption Market Information The company's units, shares, and warrants are traded on the Nasdaq Capital Market - Units, Class A ordinary shares, and redeemable warrants are traded on the Nasdaq Capital Market under symbols GPACU, GPAC, and GPACW, respectively[298] Holders The company's securities were held by a limited number of record holders as of March 2022 Holders of Record (March 17, 2022) | Security Type | Number of Holders | | :------------ | :---------------- | | Units | 1 | | Class A ordinary shares | 2 | | Class B ordinary shares | 1 | | Public warrants | 1 | | Private placement warrants | 1 | Dividends No cash dividends have been paid and none are planned before a business combination - No cash dividends have been paid on ordinary shares to date, and none are intended prior to the completion of an initial business combination[300] Securities Authorized for Issuance Under Equity Compensation Plans. The company has no securities authorized for issuance under equity compensation plans - No securities are authorized for issuance under equity compensation plans[301] Recent Sales of Unregistered Securities The company has not recently sold any unregistered securities - No recent sales of unregistered securities[302] Purchases of Equity Securities by the Issuer and Affiliated Purchasers A significant redemption of Class A ordinary shares occurred in January 2023, reducing the trust account balance - On January 11, 2023, holders of 26,068,281 Class A ordinary shares exercised their right to redeem shares for approximately $10.167 per share, totaling approximately $265,050,166[303] - After these redemptions, the balance in the trust account was approximately $40,425,891.61[303] Item 6. Reserved This item is intentionally left blank - Item 6 is reserved[304] Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The company has no operating revenue, with net income driven by warrant liability changes and interest income Cautionary Note Regarding Forward-Looking Statements This report contains forward-looking statements that are subject to risks and uncertainties - This section includes forward-looking statements based on management's beliefs and assumptions, which may differ materially from actual results due to various risks[306] Overview The company is a blank check entity facing going concern uncertainty due to negative working capital and a pending business combination deadline - The company is a blank check company incorporated in November 2020, focused on effecting a business combination[307] - Issuance of additional shares or debt in a business combination could significantly dilute existing investors or negatively impact financial flexibility[308][313] - As of December 31, 2022, the company had $101,000 in cash and negative working capital of approximately $3,767,000, raising substantial doubt about its ability to continue as a going concern[309][322] - On January 11, 2023, shareholders redeemed 26,068,281 Class A ordinary shares for approximately $265,050,166, reducing the trust account balance to approximately $40,425,891.61[310] Results of Operations The company generated no operating revenue, with net income primarily from warrant liability changes and trust account interest - The company's activities since inception primarily involved formation, public offering preparation, and searching for a business combination, with no operating revenues[311] Key Financial Results (Years Ended December 31) | Metric | 2022 (approx.) | 2021 (approx.) | | :----------------------------------- | :------------- | :------------- | | General and administrative expenses | $1,984,000 | $3,599,000 | | Loss from operations | $(1,984,000) | $(3,599,000) | | Income from Trust Account investments | $4,600,000 | $75,000 | | Change in fair value of warrant liability | $12,453,000 | $9,029,000 | | Net income | $15,069,000 | $4,705,000 | | Net income per Class A ordinary share | $0.40 | $0.13 | - Operating costs include administrative services from the Sponsor ($25,000/month) and professional/consulting fees for business combination candidates[312] - Interest income significantly increased from $75,000 in 2021 to $4,600,000 in 2022, reflecting market conditions[315] - Other income from the change in fair value of warrant liability was approximately $12,453,000 in 2022 and $9,029,000 in 2021[316] Liquidity and Capital Resources The company's liquidity is constrained, with substantial doubt about its ability to continue as a going concern - The Public Offering and Private Placement generated approximately $301,471,000 in net proceeds, with $300,000,000 deposited into the Trust Account[318][319] Cash Available Outside Trust Account | Date | Amount (approx.) | | :----------- | :--------------- | | Dec 31, 2022 | $101,000 | | Dec 31, 2021 | $842,000 | - Subsequent to December 31, 2022, redemptions of Class A ordinary shares reduced the trust account balance by approximately $265,050,000, leaving approximately $40,425,891.61[320][554] - The company's ability to continue as a going concern is in substantial doubt due to negative working capital and the need to complete a business combination by the extended Termination Date of January 14, 2024[322][323][329] - The company's plan to address going concern uncertainties includes extending the business combination deadline, securing financing via an Investment Agreement, deferring payments, and settling accrued liabilities[323] - A promissory note of up to $2,000,000 from the Sponsor for working capital had an outstanding balance of $785,000 as of December 31, 2022, with its maturity date extended to the Termination Date[324][325][510][511] Off-balance sheet financing arrangements The company does not have any off-balance sheet financing arrangements - The company has no off-balance sheet arrangements, special purpose entities, or guarantees of other entities' debt[331][332] Contractual obligations The company's primary contractual obligation is a monthly administrative support fee to its sponsor - As of December 31, 2022, the company had no long-term debt, capital lease obligations, operating lease obligations, or long-term liabilities[333] - The company pays its Sponsor $25,000 per month for administrative support services under an Administrative Support Agreement[333] - Engagement letters for business combination consultants may include material contingent or success fees, which would be charged to operations upon consummation[334][335] Critical Accounting Estimates Management has determined that the company has no critical accounting estimates - Management has determined that the company has no critical accounting estimates[338] JOBS Act As an emerging growth company, the company utilizes reduced reporting requirements under the JOBS Act - The company qualifies as an 'emerging growth company' under the JOBS Act and has elected to delay the adoption of new or revised accounting standards, potentially affecting comparability with other public companies[339][263] - It may also take advantage of other reduced reporting requirements, such as exemptions from auditor attestation on internal controls and certain executive compensation disclosures[340][341] Item 7A. Quantitative and Qualitative Disclosures about Market Risk The company has no material exposure to interest rate risk due to its conservative investment strategy - Investments in the trust account are in short-term U.S. Government treasury obligations or money market funds, leading to no material exposure to interest rate risk[342] Item 8. Financial Statements and Supplementary Data This section references the company's audited financial statements and supplementary data - Financial statements and supplementary data are referenced starting on page F-1 of the annual report[343] Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure The company reports no changes in or disagreements with its accountants - No changes in or disagreements with accountants on accounting and financial disclosure[344] Item 9A. Controls and Procedures The company has remediated a prior material weakness in internal controls and maintains effective disclosure controls Evaluation of Disclosure Controls and Procedures The company has evaluated its disclosure controls and remediated a prior material weakness - The company is required to comply with Sarbanes-Oxley Act internal control requirements but is exempt from auditor attestation as an emerging growth company[345] - A material weakness in 2021 related to accounting for complex financial instruments was identified but remediated, leading management to believe financial statements are fairly presented[347] Management's Annual Report on Internal Control over Financial Reporting Management concluded that internal controls were effective as of year-end 2022 - Management is responsible for establishing and maintaining adequate internal control over financial reporting, designed to provide reasonable assurance regarding financial reporting reliability[351] - As of December 31, 2022, management concluded that disclosure controls and procedures had no material weakness in accounting for complex financial instruments[353] Changes in Internal Control over Financial Reporting The company implemented remediation efforts to address a previously identified material weakness - Remediation efforts for the material weakness in accounting for complex financial instruments involved additional accounting and financial analyses and consulting with subject matter experts[355] - Disclosure controls and procedures, despite improvements, can only provide reasonable, not absolute, assurance due to inherent limitations[356] Item 9B. Other Information The company has no other information to report in this section - No other information to report[357] Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspection This disclosure is not applicable to the company - Disclosure regarding foreign jurisdictions that prevent inspection is not applicable[358] PART III Item 10. Directors, Executive Officers and Corporate Governance The company is led by an experienced team with a majority-independent board and established governance committees Officers and Directors The company is managed by a team of experienced executives and directors from relevant industries Officers and Directors | Name | Age | Position | | :---------------- | :-- | :----------------------------- | | Chandra R. Patel | 57 | Chief Executive Officer and Chairman | | Jarett Goldman | 36 | Chief Financial Officer | | Graeme Shaw | 52 | Chief Technology Officer | | Richard C. Davis | 57 | President and Director | | Gary DiCamillo | 72 | Director | | Claudia Hollingsworth | 62 | Director | | William Kerr | 81 | Director | - Chandra R. Patel, Jarett Goldman, Graeme Shaw, and Richard C. Davis hold key executive and director roles, with extensive experience in private equity, corporate finance, and the space/telecommunications industries[362][363][364][365] Number and Terms of Office of Officers and Directors The board consists of five directors serving staggered three-year terms, with the sponsor controlling appointments pre-combination - The board consists of five directors, divided into three classes with staggered three-year terms[369] - Prior to a business combination, only holders of founder shares (the sponsor) have the right to vote on director appointments and removals[370] Director Independence A majority of the board of directors is independent according to Nasdaq standards - Mr. DiCamillo, Ms. Hollingsworth, and Mr. Kerr are determined to be 'independent directors' under Nasdaq listing standards[373] Committees of the Board of Directors The board has established Audit, Compensation, and Nominating committees composed entirely of independent directors - The board has three standing committees: Audit, Compensation, and Nominating and Corporate Governance, all comprised solely of independent directors[374] - The Audit Committee is responsible for overseeing financial reporting, independent auditor relations, and compliance, with Mr. DiCamillo, Ms. Hollingsworth, and Mr. Kerr serving as members[375][376] - The Compensation Committee reviews and approves executive compensation, while the Nominating and Corporate Governance Committee identifies director candidates and oversees corporate governance[378][380][381] Code of Ethics The company has adopted a Code of Ethics for all directors, officers, and employees - A Code of Ethics applicable to directors, officers, and employees has been adopted[383] Administrative Support Agreement The company pays its sponsor a monthly fee for administrative support services - The company pays its sponsor $25,000 per month for administrative support services, which will cease upon business combination or liquidation[384] Shareholder Approval for Business Combination The sponsor has agreed to vote its shares in favor of any proposed business combination - If shareholder approval is sought for a business combination, it requires an ordinary resolution (majority vote), and the sponsor has agreed to vote its shares in favor[385] Conflicts of Interest Potential conflicts of interest exist due to officers' and directors' affiliations with other entities - Directors and officers owe fiduciary duties under Cayman Islands law, including acting in good faith and avoiding conflicts of interest[386] - Officers and directors may have fiduciary or contractual obligations to other entities, potentially leading to conflicts in presenting business opportunities[388] Officer and Director Affiliations | Individual | Entity | Entity's business | Affiliation | | :------------------ | :-------------------------- | :---------------------------- | :-------------------------- | | Chandra R. Patel | Antarctica Capital | International Private Equity | Founder and Managing Partner | | | Constellation Acquisition Corp I | Special Purpose Acquisition Company | Chief Executive Officer and Chairman | | | EarthDaily Holdings | Earth Observation and Data Analytics Company | Director | | | eCommunity Holdings | Fiber Asset Owner and Operator | Director | | | Weddell Holdings | Asset Reinsurance Company | Director | | Richard C. Davis | Antarctica Capital | International Private Equity | Managing Director | | | ArgoSat Advisors | Global Advisory Firm | Founder and Managing Member | | | Constellation Acquisition Corp I | Special Purpose Acquisition Company | President and Board Member | | | Descartes Labs | Geospatial Analytics Company | Chief Executive Officer and Board Member | | | EarthDaily Holdings | Earth Observation and Data Analytics Company | Board Member | | | SatixFy Communications Ltd | Satellite Communications Systems Company | Board Member | | | Sky and Space | Satellite Communications Company | Board Member | | Jarett Goldman | Antarctica Capital | International Private Equity | Director | | | Constellation Acquisition Corp I | Special Purpose Acquisition Company | Chief Financial Officer | | | Descartes Acquisition Corp. | Geospatial Analytics Company | Director & Chairman of the Board | | | Weddell Holdings Ltd. | Asset Reinsurance Company | Director | | Graeme Shaw | ArgoSat Advisors | Global Advisory Firm | Founder and Managing Member | | | Constellation Acquisition Corp I | Special Purpose Acquisition Company | Chief Technology Officer | | | Descartes Labs | Geospatial Analytics Company | Chief Operating Officer, President, and Board Member | | Gary DiCamillo | Eaglepoint Advisors | Advisory Company | Managing Partner | | | Purple Innovation, LLC | Comfort Technology Company | Director | | | Whirlpool Corporation | Home Appliances Manufacturer and Marketer | Director | | Claudia Hollingsworth | Destinations by Design, Inc. | Full-Service Event Planning Company | Director | | | i2CEO | Advisory Company | Chief Executive Officer | | | Purple Innovation, LLC | Comfort Technology Company | Director | | William Kerr | Eaglepoint Advisors | Advisory Company | Partner | | | The Interpublic Group of Companies, Inc. | Advertising Company | Director | Item 11. Executive Compensation Executives receive no cash compensation but are reimbursed for expenses, with potential for future fees post-combination - No cash compensation has been paid to executive officers or directors for services rendered to date[394] - Executive officers and directors are reimbursed for out-of-pocket expenses incurred on the company's behalf, subject to quarterly review by the audit committee[394] - After a business combination, directors or management team members who remain with the company may be paid consulting or management fees, with amounts determined by the post-combination board[395] Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The sponsor holds a controlling interest in the company, granting it significant influence over corporate actions Beneficial Ownership Table The sponsor and certain investment firms are the principal beneficial owners of the company's shares Beneficial Ownership of Ordinary Shares (December 31, 2022) | Name and Address of Beneficial Owner | Class A Ordinary Share (Number) | Class A Ordinary Share (Approximate Percentage) | Class B Ordinary Shares (Number) | Class B Ordinary Shares (Approximate Percentage) | Approximate Percentage of Outstanding Shares | | :----------------------------------- | :------------------------------ | :---------------------------------------------- | :------------------------------- | :----------------------------------------------- | :------------------------------------------- | | Global Partner Sponsor II LLC | — | — | 7,500,000 | 100.0% | 20.0% | | All directors and executive officers as a group (7 individuals) | — | — | 7,500,000 | 100% | 20.0% | | Aristeia Capital, L.L.C. | 2,343,178 | 7.81% | — | — | 6.2% | | Glazer Capital, LLC | 2,544,318 | 8.48% | — | — | 6.8% | Sponsor Control and Influence The sponsor's significant ownership allows it to exert substantial influence over shareholder votes - The sponsor beneficially owns 65.6% of the issued and outstanding ordinary shares (post-redemption), giving it substantial influence over shareholder votes and director appointments[404] - The sponsor and management team have agreed to vote their founder shares and public shares in favor of any proposed business combination[405] Transfers of Founder Shares and Private Placement Warrants Founder shares and private placement warrants are subject to transfer restrictions and lock-up periods - Founder shares and private placement warrants are subject to lock-up provisions and transfer restrictions, generally for one year post-business combination or until certain share price thresholds are met[406][407] Item 13. Certain Relationships and Related Transactions, and Director Independence The company engages in several related party transactions with its sponsor, which are reviewed by the audit committee Founder Shares and Private Placement Warrants The sponsor purchased founder shares and private placement warrants at nominal and fixed prices, respectively - The sponsor purchased 7,500,000 founder shares for $25,000 and 5,566,667 private placement warrants for $8,350,000[408][409] - Founder shares are subject to vesting conditions, including 50% upon business combination and additional percentages based on shareholder return targets[502] Administrative Support and Reimbursements The sponsor provides administrative support for a monthly fee and is reimbursed for out-of-pocket expenses - The company pays its sponsor $25,000 per month for office space and administrative services[413][417] - Out-of-pocket expenses incurred by the sponsor, officers, or directors are reimbursed, with no cap, and reviewed quarterly by the audit committee[413][415][417] Related Party Loans The sponsor has provided loans for IPO and transaction costs, with some convertible into warrants - The sponsor loaned the company up to $300,000 for IPO expenses, which was repaid upon IPO closing[416][509] - The sponsor or affiliates may loan funds for transaction costs, with up to $2,000,000 convertible into warrants identical to private placement warrants[417][418] Post-Combination Compensation and Registration Rights Management may receive fees post-combination, and the sponsor holds registration rights for its securities - Members of the management team may receive consulting or management fees from the combined company post-business combination[419] - The sponsor has registration rights for private placement warrants, working capital loan warrants, and Class A ordinary shares from founder share conversion[420] Policy for Approval of Related Party Transactions The audit committee is responsible for reviewing and approving all related party transactions - The audit committee reviews, approves, and/or ratifies related party transactions, with interested committee members abstaining from voting[421] Director Independence A majority of the board of directors meets the criteria for independence under Nasdaq listing standards - A majority of the board, specifically Mr. DiCamillo, Ms. Hollingsworth, and Mr. Kerr, are independent directors as per Nasdaq listing standards[422] Item 14. Principal Accountant Fees and Services The company's audit and tax services were provided by WithumSmith+Brown, PC, with all fees pre-approved by the audit committee Principal Accountant Fees (WithumSmith+Brown, PC) | Fee Type | 2022 (approx.) | 2021 (approx.) | | :-------------- | :------------- | :------------- | | Audit Fees | $83,200 | $66,560 | | Audit-Related Fees | $0 | $0 | | Tax Fees | $0 | $3,750 | | All Other Fees | $0 | $0 | - All auditing and permitted non-audit services are pre-approved by the audit committee[428] PART IV Item 15. Exhibit and Financial Statement Schedules This section lists the financial statements, schedules, and exhibits included in the report Financial Statements The report includes audited financial statements for 2022 and 2021, with a going concern uncertainty noted - The report includes audited financial statements for the years ended December 31, 2022 and 2021, prepared in conformity with U.S. GAAP[436] - The independent auditor's report highlights a 'going concern' uncertainty due to liquidity needs and the deadline for a business combination[437] Balance Sheet Summary (December 31) | Metric | 2022 (approx.) | 2021 (approx.) | | :-------------------------- | :------------- | :------------- | | Total current assets | $109,000 | $1,025,000 | | Investments held in Trust Account | $304,675,000 | $300,075,000 | | Total assets | $304,784,000 | $301,100,000 | | Total current liabilities | $3,876,000 | $2,808,000 | | Warrant liability | $467,000 | $12,920,000 | | Deferred underwriting compensation | $10,500,000 | $10,500,000 | | Total liabilities | $14,843,000 | $26,228,000 | | Class A ordinary shares subject to possible redemption | $304,675,000 | $300,000,000 | | Total shareholders' deficit | $(14,734,000) | $(25,128,000) | Statements of Operations Summary (Years Ended December 31) | Metric | 2022 (approx.) | 2021 (approx.) | | :-------------------------- | :------------- | :------------- | | General and administrative expenses | $1,984,000 | $3,599,000 | | Loss from operations | $(1,984,000) | $(3,599,000) | | Income from Trust Account | $4,600,000 | $75,000 | | Change in fair value of warrant liability | $12,453,000 | $9,029,000 | | Net income | $15,069,000 | $4,705,000 | | Net income per Class A ordinary share | $0.40 | $0.13 | Statements of Cash Flows Summary (Years Ended December 31) | Activity | 2022 (approx.) | 2021 (approx.) | | :-------------------------- | :------------- | :------------- | | Net cash used in operating activities | $(1,526,000) | $(1,044,000) | | Cash deposited in Trust Account | $0 | $(300,000,000) | | Net cash provided by financing activities | $785,000 | $301,866,000 | | Net change in cash | $741,000 | $822,000 | | Cash at end of the year | $101,000 | $842,000 | Notes to Financial Statements The notes detail the company's organization, accounting policies, transactions, and subsequent events - The company is a Cayman Islands exempted company formed in November 2020, operating as a blank check company to effect a business combination[455] - Subsequent to December 31, 2022, control of the Sponsor was transferred to affiliates of Antarctica Capital Partners LLC, and shareholders approved an extension to the business combination deadline to April 14, 2023, with further monthly extensions possible until January 14, 2024[459][460][463][553][554] - The trust account, initially $300,000,000, is invested in U.S. government treasury bills or money market funds and is restricted until a business combination or liquidation[458][459][462] - The company faces substantial doubt about its ability to continue as a going concern due to negative working capital and the need to complete a business combination[472] - Warrants are accounted for as liability-classified instruments and are re-measured at fair value each reporting period, with changes recognized in the statement of operations[492][493] Warrant Liabilities Fair Value (December 31) | Description | 2022 (approx.) | 2021 (approx.) | | :---------------------- | :------------- | :------------- | | Public Warrants | $300,000 | $8,300,000 | | Private Placement Warrants | $167,000 | $4,620,000 | | Total Warrant liability | $467,000 | $12,920,000 | - The company has no long-term debt or lease obligations but has an Administrative Support Agreement with the Sponsor for $25,000 per month[515] - Subsequent events include the issuance of new promissory notes from the Sponsor totaling up to $3,250,000 for expenses and trust account contributions, with portions convertible into warrants[512][514][546][547][548][549] Item 16. Form 10-K Summary This item is not applicable to the company - Form 10-K Summary is not applicable[434]