Note 5 — Commitments and Contingencies

Registration Rights

The holders of Founder Shares, Private Placement Warrants, and securities that may be issued upon conversion of Working Capital Loans, if any, are entitled to registration rights pursuant to a registration rights agreement entered in connection with the Initial Public Offering. These holders are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, these holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of the initial Business Combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements.

Underwriting Agreement

After the Initial Public Offering, the underwriters were entitled to a deferred fee of $0.35 per Unit, or $14,000,000 in the aggregate. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement. Effective December 20, 2022, in accordance with a fee reduction agreement, the underwriter agreed to irrevocably forfeit $10,000,000 of the aggregate $14,000,000 deferred fee that would otherwise be payable to it in cash pursuant the underwriting agreement, resulting in a reduced deferred fee of $4,000,000, which shall be payable to the underwriter upon consummation of a Business Combination, as originally set forth in the underwriting agreement. The Company accounted for this forfeiture during the fourth calendar quarter of the year ended December 31, 2022.

On June 23, 2023, the Company and the underwriter agreed to terminate the December 20, 2022 fee reduction agreement solely upon execution of a side letter in accordance with the duly executed Mutual Termination of Initial Fee Reduction Agreement. On June 23, 2023, in accordance with the duly executed Side Letter to Underwriting Agreement, the Company and the underwriter agreed to the following:

However, on August 15, 2024, as part of the change in sponsor in connection with the share purchase agreement, the Company, the Original Sponsor, the New Sponsor, and Cantor Fitzgerald & Co., as the underwriter from the IPO, entered into an agreement under which Cantor agreed to accept a certain number of shares of the Company following the completion of a Business Combination, in lieu of the cash deferred commissions owed from the IPO.

The fees noted in items 1, 2 and additional notes above are contingent upon the successful completion of a Business Combination. There is no assurance that a Business Combination will be consummated by any such date of termination approved in accordance with the Amended and Restated Memorandum and Articles of Association. In accordance with the guidance in ASC Topic 450, Contingencies, the Company is required to record its best estimate of the loss if the amount of loss can be reasonably estimated. The fee amount noted in item 2 cannot be reasonably estimated or determinable at this time and as a result, is not recorded in the financial statements.

Finder’s Fee Arrangement

In connection with the Proposed Business Combination, a portion of the founder shares will be distributed under an agreement with a third party dated as of April 28, 2023 that constitutes a finder’s fee arrangement (the “Finder’s Fee Arrangement”). The Finder’s Fee Arrangement provides for our sponsor to make a $2 million cash payment to the third party and provide an option to purchase an economic interest in 2,000,000 membership units of the sponsor contingent on the consummation of the Proposed Business Combination, which are accounted for under the guidance in ASC 718. Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. Compensation expense related to such shares is recognized only when the performance-based vesting condition (i.e. the consummation of the Proposed Business Combination) is probable of achievement under the applicable accounting literature. Stock-based compensation would be recognized at the consummation of the Proposed Business Combination, in an amount equal to the number of such shares times the grant date fair value per share (unless subsequently modified) less the amount initially received for the transfer of such shares. The Company will reflect the transactions in its financial statements when the Proposed Business Combination is consummated as the sponsor is a principal shareholder in the Company and the Company benefits from the Finder’s Fee Arrangement.

If the Proposed Business Combination does not close for any reason, and a termination fee is actually paid by Noventiq to the Company, the Sponsor or their affiliates, then the third party will be entitled to receive a $2,000,000 cash payment. Not withstanding the foregoing, to the extent the termination fee is not sufficient to cover the $2,000,000 cash payment, then the Sponsor and the third party will share the balance in an amount to be reasonably agreed to at the time. The Finder’s Fee Arrangement is included potential compensation payable to the third party.

On March 14, 2024, the Finder’s fee Arrangement was amended and restated which no longer provides the third party an option to purchase an economic interest in 2,000,000 membership units of the sponsor contingent on the consummation of the Proposed Business Combination. Instead, the parties have agreed that once the Sponsor has received ordinary shares from a successfully completed transaction and any earnouts or other contingent releases thereto, it shall distribute shares to the third party in accordance with the terms and conditions of the Sponsor operating agreement and the Amended and Restated Business Combination Agreement. In addition, the $2,000,000 cash payment to third party will be paid by Noventiq instead of the Sponsor and will be denominated as a Company transaction expense. In the event the Proposed Business Combination is not consummated and the Sponsor receives a termination fee, the third party shall receive $1,000,000 as complete satisfaction of the cash payment.

As the Proposed Business Combination was terminated on July 3, 2024, the Company does not expect to recognize compensation expense associated with this arrangement.