10-Q

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

CROWN PROPTECH ACQUISITIONS

NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

JUNE 30, 2023

Note 1—Organization and Business Operations

Organization and General

Crown PropTech Acquisitions (the “Company” or “Crown”) was incorporated in the Cayman Islands on September 24, 2020. The Company was formed for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar Business Combination with one or more businesses (a “Business Combination”). The Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.

As of June 30, 2023, the Company had not yet commenced any operations. All activity through June 30, 2023, relates to the Company’s formation and the Initial Public Offering (“IPO”) described below, and since the closing of the IPO, the search for a prospective initial Business Combination. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate

non-operating

income in the form of interest income on cash and cash equivalents from the proceeds derived from the IPO.

Change in Management and Sponsor

On January 17, 2023, Richard Chera informed the Company of his decision to resign as Chief Executive Officer (“CEO”) and principal financial and accounting officer of the Company, effective immediately. Mr. Chera’s resignation was voluntary and not the result of any disagreement with the operations, policies or practices of the Company. Mr. Chera shall continue to serve as a director of the Company.

On January 17, 2023, the Board of Directors of the Company (the “Board”) appointed Mr. Gavin Cuneo and Mr. Michael Minnick as

co-CEOs

of the Company, effective immediately.

Additionally, in connection with this appointment, each of Mr. Cuneo and Mr. Minnick entered into an Indemnity Agreement and a Letter Agreement with the Company on the same terms as the Indemnity Agreements and Letter Agreements entered into by the directors and officers of the Company at the time of the Company’s IPO. In addition, CIIG Management III LLC (“CIIG”) entered into the Letter Agreement. CIIG also entered into that certain joinder agreement to the Registration Rights Agreement as described in further detail below.

On January 17, 2023, CIIG entered into a Securities Assignment Agreement (the “Assignment Agreement”), by and among Crown PropTech Sponsor, LLC (“Crown PropTech Sponsor”), CIIG and Richard Chera, whereby Crown PropTech Sponsor sold, transferred and assigned 5,662,000 Class B ordinary shares of the Company and 250,667 private placement warrants to purchase Class A ordinary shares of the Company to CIIG. In connection with entry into the Assignment Agreement, CIIG (i) entered into a Letter Agreement with the Company (the “Letter Agreement”) and (ii) entered into a joinder agreement to the Registration Rights Agreement entered into by Crown PropTech Sponsor in connection with the Company’s IPO. As a result of the above transaction CIIG became a

co-sponsor

to Crown (and together with Crown PropTech Sponsor, the “Sponsors”).

In connection with the above transaction, Crown PropTech Sponsor entered into a letter agreement dated as of January 17, 2023, whereby Crown PropTech Sponsor is no longer entitled to receive any payments under the administrative services agreement and the Company is no longer required to pay any such payments. As of the date of this Quarterly Report, the Company has not made any payments pursuant to the administrative agreement and does not expect to incur any related expenses in the near future.

Extraordinary General Meeting

Beginning on January 31, 2023, and continuing until the Company’s February 9, 2023 extraordinary general meeting of shareholders (“Extraordinary General Meeting”), the Company and CIIG entered into certain

non-redemption

agreements and assignments of economic interests (the

“Non-Redemption

Agreements”) with certain investors (the

“Non-Redeeming

Investors”). The

Non-Redemption

Agreements provide for the assignment of economic interest of an aggregate of 1,500,000 Class B ordinary shares held by CIIG to the

Non-Redeeming

Investors in exchange for such

Non-Redeeming

Investors agreeing to hold and not redeem an aggregate of 4,000,000 Class A ordinary shares at the Extraordinary General Meeting. Pursuant to the

Non-Redemption

Agreements, CIIG has agreed to transfer to such

Non-Redeeming

Investors an aggregate of 1,500,000 Class A ordinary shares upon conversion of the Class B ordinary shares in connection with the consummation of an initial Business Combination.

On February 9, 2023, the Company’s shareholders approved an amendment to amend and restate the Company’s Amended and Restated Memorandum and Articles of Association to extend the date by which the Company must consummate an initial Business Combination from February 11, 2023 to February 11, 2024 (the “Extension Proposal”).

In connection with the vote to approve the Extension Proposal, shareholders holding an aggregate of 23,403,515 shares of the Company’s Class A ordinary shares exercised their right to redeem their shares for a pro rata portion of the funds in the Trust Account (as defined below). As a result, $238,305,063 (approximately $10.18 per share) was

withdrawn

from the Trust Account (described below) to

redeem such shares. Following the redemptions, there

were 4,196,485 Class A ordinary shares issued and outstanding and the 6,900,000 Founder Shares (as defined below) that remained outstanding represented 62.2% of the Company’s issued and outstanding ordinary shares.

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Change in Board of Directors

On May 5, 2023, Frits van Paasschen, a member of the Board, chair of the Audit Committee of the Board, chair of the Nominating and Corporate Governance Committee of the Board, and a member of the Compensation Committee of the Board, notified the Board of his resignation from the Board, effective upon the acceptance by the Board, which the Board accepted on May 8, 2023. Mr. van Paasschen’s resignation was voluntary and not the result of any disagreement with the operations, policies or practices of the Company.

On May 8, 2023, the Board elected Chris Rogers as a member of the Board, chair of the Audit Committee of the Board, a member of the Nominating and Corporate Governance Committee of the Board, and a member of the Compensation Committee of the Board, effective immediately.

Financing

The

registration

statement for the Company’s IPO was declared effective on February 9, 2021. On February 11, 2021, the Company consummated the IPO

by issuing

27,600,000 units (the “Units” and, with respect to the Class A ordinary shares included in the Units being offered, the “public share”), at $10.00 per Unit, generating gross proceeds of $276,000,000, which is discussed in Note 3.

Simultaneously

with the closing of the IPO, the Company consummated the sale of 5,013,333 warrants (the “Private Placement Warrant”), at a price of $1.50 per Private Placement Warrant, which is discussed in Note 4.

Trust Account

Following

the closing of the IPO on February 11, 2021, an amount of $276,000,000 from the net proceeds of the sale of the Units in the IPO and the sale of the Private Placement Warrants was placed in a trust account (“Trust Account”) which is invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940 (the “Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund meeting the conditions of Rule

2a-7

of the Investment Company Act, as determined by the Company. Except with respect to interest earned on the funds held in the Trust Account that may be released to the Company to pay its tax obligations, the proceeds from the IPO and the sale of the private placement units will not be released from the Trust Account until the earliest of (a) the completion of the Company’s initial Business Combination, (b) the redemption of any public shares properly submitted in connection with a shareholder vote to amend the Company’s amended and restated certificate of incorporation, and (c) the redemption of the Company’s public shares if the Company is unable to complete the initial Business Combination within 36 months from the closing of the IPO (or until February 11, 2024), subject to applicable law. The proceeds deposited in the Trust Account could become subject to the claims of the Company’s creditors, if any, which could have priority over the claims of the Company’s public

shareholders.

Termination of the Proposed Brivo Transaction

November 10, 2021, the Company entered into a Business Combination agreement (the “BCA” or the “Business Combination Agreement”), by and among (i) the Company, (ii) Crown PropTech Merger Sub I Corp, a Delaware corporation and wholly owned direct subsidiary of Crown (“Merger Sub I”), (iii) Crown PropTech Merger Sub II LLC, a Delaware limited liability company and a wholly owned subsidiary of Crown (“Merger Sub II”, and together with Merger Sub I the “Merger Subs”) and (iv) Brivo, Inc., a Nevada corporation (“Brivo” and all the parties to the Business Combination Agreement, the “Parties to the Business Combination Agreement”) (the “Business Combination”). The obligation of Brivo to consummate the Business Combination was subject to certain closing conditions, including, but not limited to, the aggregate cash proceeds from Crown’s trust account, together with the proceeds from the sale of the PIPE Notes (as defined below).

connection with the signing of the Business Combination Agreement, the Company entered into subscription agreements (the “Subscription Agreements”) with certain investors (the “PIPE Investors”). Pursuant to the terms of the Subscription Agreements, each PIPE Investor had the right to terminate its Subscription Agreement after July 9, 2022, if the closing of the Business Combination had not occurred as of such date or at any date and time as the Business Combination Agreement is validly terminated.

Golub

Capital LLC and its affiliates (together with its affiliates, “Golub”), a PIPE Investor, subscribed for PIPE Notes with an aggregate principal amount of $68 million. On July 11, 2022, the Company received a notice of election from Golub, notifying the Company that Golub has elected to terminate Golub’s Subscription Agreement

because the Business Combination had not been consummated by July 9,

2022.

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August 10, 2022, the Company received a notice of election from Brivo, notifying the Company that Brivo had elected to terminate the Business Combination. As a result of such election, the Business Combination was immediately terminated. In addition, the remaining Subscription Agreements were automatically terminated.

Following a confidential settlement arrangement, the Company is no longer pursuing any remedies in connection with the termination of the Brivo Business Combination.

On January 13, 2023, the Company formally withdrew its Form

S-4

Registration Statement from the SEC associated with the BCA.

Initial Business Combination

The Company’s management has broad discretion with respect to the specific application of the net proceeds of the IPO, although substantially all of the net proceeds are intended to be generally applied toward consummating a Business Combination.

The

Company’s

Business Combination must be with one or more target businesses that together have a fair market value equal to at least

% of the balance in the Trust Account (as defined below) (net of taxes payable) at the time of the signing an agreement to enter into a Business Combination. However, the Company will only complete a Business Combination if the post-Business Combination company owns or acquires

% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance that the Company will be able to successfully effect a Business Combination.

The

Company

will provide its public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of the initial Business Combination either (i) in connection with a shareholder meeting called to approve the initial Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a proposed initial Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The shareholders will be entitled to redeem their shares for a pro rata portion of the amount then on deposit in the Trust Account (initially $10.00 per share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations).

The

Class

A ordinary shares subject to redemption are recorded at a redemption value and classified as temporary equity upon the completion of the IPO, in accordance with Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” In such case, the Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 either immediately prior to or upon consummation of a Business Combination and, if the Company seeks shareholder approval, a majority of the issued and outstanding shares voted are voted in favor of the Business Combination.

of June

30, 2023, the Company has until February 11, 2024 to consummate a Business Combination (the “Combination Period”). However, if the Company is unable to complete a Business Combination within the Combination Period, the Company will redeem 100% of the outstanding public shares for a pro rata portion of the funds held in the Trust Account, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to the Company, divided by the number of then outstanding public shares, subject to applicable law and as further described in the registration statement, and then seek to dissolve and liquidate.

The

Company’s Sponsors, officers and directors have agreed to (i) waive their redemption rights with respect to their Founder Shares, private placement shares and public shares in connection with the completion of the initial Business Combination, (ii) waive their redemption rights with respect to their Founder Shares and public shares in connection with a shareholder vote to approve an amendment to the Company’s amended and restated certificate of incorporation, and (iii) waive their rights to liquidating distributions from the Trust Account with respect to their Founder Shares and private placement shares if the Company fails to complete the initial Business Combination within the Combination Period.

the event

of a liquidation of the Trust Account upon the failure of the Company to consummate its initial Business Combination by February 11, 2024, Crown PropTech Sponsor (but not CIIG) has agreed that it will indemnify the Company if and to the extent any claims by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or similar agreement or Business Combination agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $10.00 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.00 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under the Company’s indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). However, the Company has not asked Crown PropTech Sponsor to reserve for such indemnification obligations, nor has the Company independently verified whether Crown PropTech Sponsor has sufficient funds to satisfy its indemnity obligations and believe that Crown PropTech Sponsor’s only assets are securities of the Company. Therefore, the Company cannot assure that Crown PropTech Sponsor would be able to satisfy those obligations.

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Liquidity, Capital Resources and Going Concern

of June 30, 2023, the Company had cash outside the Trust Account of $31,048 available for working capital needs and working capital deficit of $1,658,590. All remaining cash held in the Trust Account is generally unavailable for the Company’s use, prior to an initial Business Combination, and is restricted for use either in a Business Combination or to redeem Class A ordinary shares. As of June 30, 2023, none of the amount in the Trust Account was available to be withdrawn as described above.

Through June 30, 2023, the Company’s liquidity needs were satisfied through receipt of $25,000 from the sale of the Founder Shares, the remaining net proceeds from the IPO, the sale of Private Placement Warrants, the Promissory Note (as defined below), the Working Capital Loan (as defined below) and capital contributions from the Sponsors of $673,418.

The Company has incurred and expects to continue to incur significant costs in pursuit of it financing and acquisition plans. The Company lacks the financial resources it needs to sustain operations for a reasonable period of time, which is considered to be one year from the issuance date of the financial statements are issued. Although no formal agreement exists, the Sponsors are committed to extend loans as needed (see Note 5).

Accordingly, the Company may not be able to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not limited to, curtailing operations, suspending the pursuit of a potential merger target, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to in on commercially acceptable terms, if at all, or that its plans to consummate an initial Business Combination will be successful.

In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”)

2014-15,

“Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that the above liquidity issues and the mandatory liquidation and subsequent dissolution, should the Company be unable to complete a Business Combination, raises substantial doubt about the Company’s ability to continue as a going concern. The Company has until February 11, 2024, or by the end of any extension to the Combination Period, to consummate a Business Combination. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for a period of time within one year from the date that the financial statements are issued. If a Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after February 11, 2024.

Risks and Uncertainties

In February 2022, the Russian Federation commenced a military action with the country of Ukraine. As a result of this action, various nations, including the United States, have instituted economic sanctions against the Russian Federation. As of the date of these financial statements, the impact of this action and the related sanctions on the world economy and the effect on these unaudited financial statements are currently not determinable.

Management continues to evaluate the impact of the

COVID-19

pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and search for a target company, the specific impact is not readily determinable as of the date of the unaudited consolidated condensed financial statements. The unaudited consolidated condensed financial statements do not include any adjustments that might result from the outcome of these uncertainties.

The Company’s results of operations and ability to complete an initial Business Combination may be adversely affected by various factors that could cause economic uncertainty and volatility in the financial markets, many of which are beyond the Company’s control. The Company’s business could be impacted by, among other things, downturns in the financial markets or in economic conditions, increases in oil prices, inflation, increases in interest rates, supply chain disruptions, declines in consumer confidence and spending, the ongoing effects of the

COVID-19

pandemic, including resurgences and the emergence of new variants, and geopolitical instability, such as the military conflict in the Ukraine. The Company cannot at this time fully predict the likelihood of one or more of the above events, their duration or magnitude or the extent to which they may negatively impact its business and the Company’s ability to complete an initial Business Combination.

Note 2 — Significant Accounting Policies

Basis of Presentation

The accompanying unaudited consolidated condensed financial statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for financial information and pursuant to the rules and regulations of the SEC. Accordingly, they do not include all of the information and footnotes required by GAAP. In the opinion of management, the unaudited consolidated condensed financial statements reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the balances and results for the periods presented. Operating results for the three and six months ended June 30, 2023 are not necessarily indicative of the results that may be expected through December 31, 2023.

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The Company’s subsidiaries include Crown PropTech Merger Sub I Corp., a Delaware corporation and wholly owned direct subsidiary of Crown (“Merger Sub I”) and Crown PropTech Merger Sub II LLC, a Delaware limited liability company and wholly owned direct subsidiary of Crown (“Merger Sub II”); both of which were formed for the purposes of facilitating a proposed business agreement. All intercompany transactions have been eliminated upon consolidation.

The accompanying unaudited consolidated condensed financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Form

10-K

filed by the Company with the S

C on May 2, 2023.

Principles of Consolidation

The accompanying consolidated condensed financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.

Emerging Growth Company Status

The Company is 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”), and it may 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, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to

non-emerging

growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s unaudited consolidated condensed financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Use of Estimates

The preparation of these unaudited consolidated condensed financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited consolidated condensed financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

The

Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did no

t have any cash equivalents as of June 30, 2023 and December 31, 2022.

Investments Held in Trust Account

At June 30, 2023 and December 31, 2022, the Trust Account had $43,906,522 and $279,998,549 held in marketable securities, respectively. Such securities are presented on the consolidated condensed balance sheets at fair value at the end of the reporting period. Dividends resulting from the change in fair value of these securities are included in trust dividend income in the accompanying consolidated condensed statements of operations. The estimated fair values of investments held in the Trust Account are determined using available market information. During the three and six months ended June 30, 2023, the Company withdrew $0 and $238,305,063, respectively, of principal and interest income from the Trust Account in connection with redemptions. During the three and six months ended June 30, 2022, no amounts were withdrawn from the Trust Account in connection with redemptions.

Concentration of Credit Risk

Financial

instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. At June 30, 2023 and December 31, 2022, the Company has not experienced losses on this account.

Class A Ordinary Shares Subject to Possible Redemption

Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Class A ordinary shares subject to mandatory redemption (if any) are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to the occurrence of uncertain future events. Accordingly, as of June 30, 2023 and December 31, 2022, 4,196,485

and

27,600,000, respectively, shares of Class A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’ deficit section of the Company’s consolidated condensed balance sheets.

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As of December 31, 2022 and June 30, 2023, the ordinary shares subject to possible redemption reflected on the consolidated condensed balance sheets are reconciled in the following table:


Ordinary shares subject to possible redemption, December 31, 2022	$	279,998,549
Less:
Redemption		(238,305,063	)
Plus:
Remeasurement of carrying value to redemption value		2,213,036

Ordinary shares subject to possible redemption, June 30, 2023	$	43,906,522

Net Income per Ordinary Shares

The

Company has two classes of shares, which are referred to as Class A ordinary shares and Class B ordinary shares. Earnings and losses are shared pro rata between the two classes of shares. Private and public warrants to purchase 14,213,333 Class A ordinary shares at $11.50 per share were issued on February 11, 2021. No warrants were exercised during the three and six months ended June 30, 2023 and 2022. The calculation of diluted income per ordinary share does not consider the effect of the warrants issued in connection with the (i) IPO, (ii) exercise of over-allotment, and (iii) Private Placement since the exercise of the warrants are contingent upon the occurrence of future events. As a result, diluted net income per ordinary share is the same as basic net income per ordinary share for the periods.


	For the Three Months Ended June 30,								For the Six Months Ended June 30,
	2023				2022				2023				2022
	Class A		Class B		Class A		Class B		Class A		Class B		Class A		Class B
Basic and diluted net income per share
Numerator:
Allocation of net income including remeasurement of temporary equity	$	326,879	$	533,330	$	170,202	$	42,551	$	345,965	$	258,372	$	2,855,394	$	713,848
Denominator
Weighted-average shares outstanding		4,196,485		6,900,000		27,600,000		6,900,000		9,239,231		6,900,000		27,600,000		6,900,000
Basic and diluted net income per share	$	0.08	$	0.08	$	0.01	$	0.01	$	0.04	$	0.04	$	0.10	$	0.10

Share Based Compensation

The Company complies with ASC 718 Compensation—Stock Compensation regarding Founder Shares acquired by directors and independent advisors of the Company at prices below fair value. The acquired shares vested upon granting of the shares. The Founder Shares owned by the director (1) may not be sold or transferred, until one year after the consummation of a Business Combination, (2) are not entitled to redemption from the funds held in the Trust Account, or any liquidating distributions. If the Company does not consummate a Business Combination during the Combination Period, the Company will liquidate and the shares will become worthless.

The

shares were issued in February 2021 (“Grant Date”), and the shares vested immediately. Since the approach in ASC 718 is to determine the fair value without regard to the vesting date, the Company has determined the valuation of the Class B shares as of the Grant Dates. The valuation for the 250,000 shares in excess of the amount paid was not material.

Fair Value of Financial Instruments

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under the Financial Accounting Standards Board (“FASB”) ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the balance sheets.

Derivative Warrant Liabilities

The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants and working capital loan options, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and

ASC815-15.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is

re-assessed

at the end of each reporting period.

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The

Company accounts for its 14,213,333 ordinary share warrants issued in connection with its IPO (9,200,000) and Private Placement (5,013,333) as derivative warrant liabilities in accordance with

ASC815-40.

Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the instruments to fair value at each reporting period. The liabilities are subject to

re-measurement

at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statements of operations.

Working Capital Loans Option

November 30, 2021, Richard Chera, the Company’s former Chief Executive Officer and director agreed to loan the Company up to $1,500,000 to be used for a portion of the expenses of the Company (“Working Capital Loan”). At December 31, 2022, at the option of Richard Chera, the outstanding principle of $666,000 may be converted into that number of warrants equal to the outstanding principle of the note divided by $1.50 (444,000 warrants). The option (“Working Capital Loan Option”) to convert the Working Capital Loan into warrants qualified as an embedded derivative under ASC 815 and was required to be reported at fair value. On May 31, 2023, and effective as of January 17, 2023, Richard Chera agreed to waive the right to convert the amounts due under the Working Capital Loan into warrants. At June 30, 2023, the Working Capital Loan Option no longer existed and at December 31, 2022 the value of the Working Capital Loan Option was $0.

Income Taxes

The

Company accounts for income taxes under ASC Topic 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the unaudited consolidated condensed financial statements and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC

Topic

740 prescribes a recognition threshold and a measurement attribute for the unaudited consolidated condensed financial statements recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company’s management determined that the Cayman Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of June 30, 2023 and December 31, 2022, there were no unrecognized tax benefits and no amounts accrued for interest and penalties. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

The Company is considered to be an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As such, the Company’s tax provision was zero for the period presented.

Recent Accounting Standards

During August 2020, the FASB issued Accounting Standards Update (“ASU”)

2020-06,

Debt—Debt with Conversion and Other Options (Subtopic

470-20)

and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic

815-40)

(“ASU

2020-06”)

to simplify accounting for certain financial instruments. ASU

2020-06

eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU

2020-06

amends the diluted earnings per share guidance, including the requirement to use the

if-converted

method for all convertible instruments. The Company adopted ASU

2020-06

on January 1, 2022, and the standard was applied on a full retrospective basis. There was no material impact on the Company’s financial position, results of operations or cash flows.

Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s unaudited consolidated condensed financial statements.

Securities Assignment Agreement

On January

17, 2023, pursuant to the Assignment Agreement, CIIG, acquired an aggregate of 5,662,000 Class B ordinary shares and 250,667 Private Placement Warrants of the Company from Crown PropTech Sponsor in a private transaction.

Management

of the Company determined the fair value of the Class B ordinary shares and Private Placement Warrants acquired to be $2,859,310. The excess value of the Class B ordinary shares and Private Placement Warrants acquired of $2,837,593 is reported as a component of shareholders’ deficit.

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Non-Redemption

Agreements

Beginning

on January 31, 2023, and continuing until the Extraordinary General Meeting, the Company and CIIG entered into the

Non-Redemption

Agreements with the

Non-Redeeming

Investors. The

Non-Redemption

Agreements provide for the assignment of economic interest of an aggregate of 1,500,000 Class B ordinary shares held by CIIG to the

Non-Redeeming

Investors in exchange for such

Non-Redeeming

Investors agreeing to hold and not redeem an aggregate of 4,000,000 Class A ordinary shares at the Extraordinary General Meeting. Pursuant to the

Non-Redemption

Agreements, CIIG has agreed to transfer to such

Non-Redeeming

Investors an aggregate of 1,500,000 Class A ordinary shares upon conversion of the Class B ordinary shares in connection with the consummation of an initial Business Combination. The Company estimated the aggregate fair value of the 1,500,000 Class B ordinary shares attributable to the

Non-Redeeming

Investors to be $1,156,500 or $0.77 per share. Each

Non-Redeeming

Investor acquired from the Sponsors an indirect economic interest in the Founder Shares. The value of the

Non-Redemption

Agreements is reported as a component of shareholders’ deficit.

Note 3—Initial Public Offering

Pursuant

to the IPO, the Company sold 27,600,000 Units, at a price of $10.00 per Unit. Each Unit consists of one Class A ordinary share, par value $0.0001 per share, and

one-third

of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one Class A ordinary share at a price of $11.50 per share.

Note 4—Private Placement Warrants

Simultaneously

with the closing of the IPO, Crown PropTech Sponsor and certain funds and accounts managed by subsidiaries of BlackRock, Inc. (collectively, the “Anchor Investor”) purchased an aggregate of 5,013,333 Private Placement Warrants at a price of $1.50 per warrant ($7,520,000 in the aggregate), each Private Placement Warrant is exercisable to purchase one Class A ordinary share at a price of $11.50 per share. A portion of the purchase price of the Private Placement Warrants was added to the proceeds from the IPO to be held in the Trust Account.

Note 5—Related Party Transactions

Founder Shares

On October

13, 2020, the Company issued 5,750,000 Class B ordinary shares to Crown PropTech Sponsor for an aggregate purchase price of $25,000 (the “Founder Shares”). On February 9, 2021, the Company effected a dividend of 0.2 of a Class B ordinary share for each Class B ordinary share, resulting in 6,900,000 Class B ordinary shares being issued and outstanding.

On February

11, 2021, Crown PropTech Sponsor transferred 690,000 Founder Shares to the Anchor Investors for $2,500. In February 2021, Crown PropTech Sponsor transferred an aggregate of 250,000 Founder Shares to four of the Company’s independent directors and two independent advisors. Immediately after transferring shares to the Anchor Investors, directors and advisors, Crown PropTech Sponsor owned 5,960,000 Founder Shares.

On January

17, 2023, CIIG entered into the Assignment Agreement, by and among Crown PropTech Sponsor, CIIG and Richard Chera, whereby the Crown PropTech Sponsor sold, transferred and assigned 5,662,000 Class B ordinary shares of the Company and 250,667 private placement warrants to purchase Class A ordinary shares of the Company to CIIG. Total consideration paid for the class B ordinary shares and private placement warrants was $21,717.

Crown

PropTech

Sponsor, CIIG and the Anchor Investor have agreed, subject to limited exceptions, not to transfer, assign or sell any Founder Shares until the earlier to occur of (i) one year after the completion of a Business Combination or (ii) the date following the completion of a Business Combination on which the Company completes a liquidation, merger, share exchange or other similar transaction that results in all of the shareholders having the right to exchange their ordinary shares for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any

30-trading

day period commencing at least 150 days after a Business Combination, the Founder Shares will be released from the lockup.

Promissory Note—Related Party

October

13, 2020, the Company issued a promissory note (the “Promissory Note”) to Crown PropTech Sponsor, pursuant to which the Company may borrow up to an aggregate principal amount of $300,000. The Promissory Note was

non-interest

bearing and payable on the earlier of (i) December 31, 2021 or (ii) the completion of the IPO. On February 11, 2021, the Company repaid the Promissory Note in full. No future borrowings are permitted under this Promissory Note.

Administrative Support Agreement

Commencing

on the date of the IPO, the Company agreed to pay Crown PropTech Sponsor a total of $15,000 per month for office space and administrative support services. Upon completion of the initial Business Combination or the Company’s liquidation, the Company would cease paying these monthly fees. On January 17, 2023, Crown PropTech Sponsor agreed to waive all amounts due under the administrative support agreement and cease charging future fees. At June 30, 2023 and December 31, 2022, $0 and $339,107, respectively, was reported on the consolidated condensed balance sheets as due to related party. At June 30, 2023, $339,107 is included in the consolidated condensed statements of operations as settlement of payables.

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Working Capital Loans

order to finance transaction costs in connection with a Business Combination, the initial shareholders or an affiliate of the initial shareholders or certain of the Company’s directors and officers may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination is not consummated, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants of the post-Business Combination entity at a price of $1.50 per warrant. The warrants would be identical to the Private Placement Warrants.

On Novembe

r 30, 2021, the Company entered into a convertible note with Richard Chera, its former Chief Executive Officer and director, pursuant to which Mr. Chera agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Note”). The Convertible Note was

non-interest

bearing and due on the earlier of: (i) 12 months from the date thereof or (ii) the date on which the Company consummates a Business Combination. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Convertible Note; however, no proceeds from the Trust Account may be used for such repayment if the Company does not consummate the Business Combination. Up to $1,500,000 of the Convertible Note may be converted into warrants at a price of $1.50 per warrant at the option of Mr. Chera (the “Conversion Right”). The warrants would be identical to the Private Placement Warrants.

May 31, 2023, and effective as of January 17, 2023, the Convertible Note was amended and restated (the “A&R Note”) in the aggregate principal amount of up to $1,000,000 to be due on the earlier of: (i) February 11, 2024; (ii) the date on which the Company consummates a Business Combination; or (iii) the effective date of a liquidation of the Company. Additionally, due to a waiver by Mr. Chera, the A&R Note no longer provides for the Conversion Right. At June 30, 2023 and December 31, 2022, $801,000 and $666,000 was outstanding on the A&R Note, respectively.

Note 6—Commitments & Contingencies

Registration Rights

The

holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any ordinary shares issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the Working Capital Loans and upon conversion of the Founder Shares) will be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of the IPO requiring the Company to register such securities for resale. The holders of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements.

Underwriters Agreement

deferred

underwriting discount of $

0.35

per Unit, or $

9,660,000

in the aggregate, was payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes an initial Business Combination, subject to the terms of the underwriting agreement. In December 2022, the underwriters agreed to waive their right to receive the deferred underwriting discount.

Advisory Service Agreements

The Company has enlisted various entities as capital market advisors to assist in the identification and consummation of an initial Business Combination.

During the fourth quarter of 2022 these contracts with the advisors have been terminated and no amounts were paid or due under the contracts.

Attorney Fees

The Company incurred legal fees in connection with the proposed Brivo Business Combination, none of which were payable until consummation of the proposed Brivo Business Combination. As of December 31, 2022, the Company fully paid a settled amount in legal fees associated with the Brivo Business Combination.

Settlement of Payables

April and January 2023 and December 2022, the Company settled $400,000, $377,871 and $6,472,941, respectively, for an aggregate $7,250,812 due to vendors and related parties. In addition, in December 2022, the underwriters agreed to waive their right to receive the deferred underwriting discount of $0.35 per Unit, or $9,660,000 in the aggregate, that was to be payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes an initial Business Combination.

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Note 7—Shareholders’ Deficit

Preference

Shares —

The Company is authorized to issue a total of

1,000,000

preference shares at par value of $

0.0001

each. At June 30, 2023 and December 31, 2022, there were

preference shares issued or outstanding.

Class

A Ordinary Shares

—

The Company is authorized to issue a total of 200,000,000 Class A ordinary shares at par value of $0.0001 each. At June 30, 2023 and December 31, 2022, there were no shares issued and outstanding (excluding 4,196,485 and 27,600,000 shares subject to possible redemption, respectively).

Class

B Ordinary Shares

—

The Company is authorized to issue a total of 20,000,000 Class B ordinary shares at par value of $0.0001 each. At June 30, 2023 and December 31, 2022, there were 6,900,000 Class B ordinary shares issued or outstanding.

Holders

of Class A ordinary shares and Class B ordinary shares will vote together as a single class on all other matters submitted to a vote of shareholders, except as required by law; provided that only holders of Class B ordinary shares have the right to vote on the appointment of directors prior to the Company’s initial Business Combination.

The

Class B

ordinary shares will automatically convert into Class A ordinary shares concurrently with or immediately following the completion of a Business Combination on a

one-for-one

basis, subject to adjustment. In the case that additional Class A ordinary shares or equity-linked securities are issued or deemed issued in connection with a Business Combination, the number of Class A ordinary shares issuable upon conversion of all Founder Shares will equal, in the aggregate, 20% of the total number of Class A ordinary shares outstanding after such conversion (after giving effect to any redemptions of Class A ordinary shares by public shareholders), including the total number of Class A ordinary shares issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of a Business Combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, or to be issued, to any seller in a Business Combination and any Private Placement Warrants issued to the sponsor, officers or directors upon conversion of Working Capital Loans; provided that such conversion of Founder Shares will never occur on a less than

one-for-one

basis.

Note 8—Warrants

Public

Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants become exercisable on the later of (a) 30 days after the completion of a Business Combination and (b) 12 months from the closing of the IPO. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation.

The

Company will not be obligated to deliver any Class A ordinary shares pursuant to the exercise of a Public Warrant and will have no obligation to settle such Public Warrant exercise unless a registration statement under the Securities Act with respect to the Class A ordinary shares underlying the Public Warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration. No Public Warrant will be exercisable and the Company will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption is available.

The

Company has agreed that as soon as practicable, but in no event later than 15

business

days, after the closing of the Company’s Business Combination, the Company will use its commercially reasonable efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the warrants. The Company will use its commercially reasonable efforts to cause the same to become effective and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration or redemption of the warrants in accordance with the provisions of the warrant agreement. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60

business day after the closing of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if the Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of public warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, and in the event the Company does not so elect, it will use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.

Once

the warrants become exercisable, the Company may redeem the Public Warrants for redemption:

•

in whole and not in part;

•

at a price of $0.01 per warrant;

•

upon not less than 30 days’ prior written notice of redemption;

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•

to each warrant holder; and

•

if, and only if, the reported closing price of the ordinary shares equals or exceeds $18.00 per share (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within a

30-trading

day period ending three business days before we send to the notice of redemption to the warrant holders.

If and

when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. If the Company calls the Public Warrants for redemption, as described above, its management will have the option to require any holder that wishes to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of ordinary shares issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described below, the Public Warrants will not be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the Public Warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of Public Warrants will not receive any of such funds with respect to their Public Warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such Public Warrants. Accordingly, the Public Warrants may expire worthless.

In additio

n, if (x) the Company issues additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by the Board and, in the case of any such issuance to the sponsor or its affiliates, without taking into account any Founder Shares held by the sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination, and (z) the volume weighted average trading price of the Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, then the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $10.00 and $18.00 per share redemption trigger prices will be adjusted (to the nearest cent) to be equal to 100% and 180% of the higher of the Market Value and the Newly Issued Price, respectively.

The Private

Placement Warrants are identical to the Public Warrants underlying the Units being sold in the IPO, except that (x) the Private Placement Warrants and the Class A ordinary shares issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions, (y) the Private Placement Warrants will be exercisable on a cashless basis and be

non-redeemable

so long as they are held by the initial purchasers or their permitted transferees and (z) the Private Placement Warrants and the Class A ordinary shares issuable upon the exercise of the Private Placement Warrants will be entitled to registration rights. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

Note 9—Fair Value Measurements

Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

•

Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets;

•

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

•

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

Recurring Fair Value Measurements

The Company’s permitted investments consist of U.S. Money Market funds. Fair values of these investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in active markets for identical assets.

The Company’s warrant liability for the Public Warrants is based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. The fair value of the Public Warrant liability is classified within Level 1 of the fair value hierarchy.

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The Company’s management believes the Private Warrants are economically equivalent to the Public Warrants. As such, the valuation of the Private Warrants is based on the valuation of the Public Warrants. The fair value of the Private Warrant liability is classified within Level 2 of the fair value hierarchy due to the Company using quoted prices for similar instruments in active markets.

At December 31, 2022, the Company’s Working Capital Loan option was based on a valuation model utilizing inputs from observable and unobservable markets with less volume and transaction frequency than active markets. The inputs used to determine the fair value of the Working Capital Loan option liability were classified within Level 3 of the fair value hierarchy. On May 31, 2023, and effective as of January 17, 2023, Richard Chera agreed to waive the right to convert the amounts due under the Working Capital Loan into warrants. At June 30, 2023, the Working Capital Loan Option no longer existed.

The following table presents fair value information of the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.


June 30, 2023	Level 1		Level 2		Level 3
Description
Assets:
Investments held in Trust Account	$	43,906,522	$	—	$	—
Liabilities:
Public Warrants	$	736,000	$	—	$	—
Private Warrants		—		401,067		—

Fair Value of warrants	$	736,000	$	401,067	$	—


December 31, 2022	Level 1		Level 2		Level 3
Description
Assets:
Investments held in Trust Account	$	279,998,549	$	—	$	—
Liabilities:
Working Capital Loan Option	$	—	$	—	$	—
Public Warrants		—		—		—
Private Warrants		—		—		—

Fair Value of warrants and Working Capital Loan Option	$	—	$	—	$	—

The Company utilized an internal model to value the Working Capital Loan op

tion

at December 31, 2022.

Note 10—Subsequent Events

The

Company evaluated subsequent events and transactions that occurred after the balance sheet date through the date that the unaudited consolidated condensed financial statements were issued. Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the unaudited consolidated condensed financial statements other than the matters discussed below.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

References to the “Company,” “Crown,” “our,” “us” or “we” refer to Crown PropTech Acquisitions. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited consolidated condensed financial statements and the notes thereto contained elsewhere in this report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” or the negative of such terms or other similar expressions. Such statements include, but are not limited to, possible business combinations and the financing thereof, and related matters, as well as all other statements other than statements of historical fact included in this Form 10-Q. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other Securities and Exchange Commission (“SEC”) filings.

Overview

We are a blank check company incorporated as a Cayman Islands exempted company on September 24, 2020 for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (a “business combination”). Our sponsors are Crown PropTech Sponsor, LLC (“Crown PropTech Sponsor”), a Delaware limited liability company and CIIG Management III LLC (“CIIG”), a Delaware limited liability company, (each, a “sponsor” and together, the “sponsors”).

The registration statement for our initial public offering (the “IPO”) became effective on February 8, 2021. On February 11, 2021, we consummated the IPO of 27,600,000 units, which included the exercise of the underwriters’ option to purchase an additional 3,600,000 units at the IPO price to cover over-allotments (the “Units” with respect to the Class A ordinary shares included in the Units being offered, the “Public Shares” with respect to the one-third of one redeemable warrant included in such Units the “Public Warrant”), at $10.00 per Unit, generating gross proceeds of $276.0 million, and incurring offering costs of approximately $15.8 million, inclusive of approximately $9.66 million in deferred underwriting commissions.

Simultaneously with the closing of the IPO, we consummated the private placement (“Private Placement”) of 5,013,333 warrants (each, a “Private Placement Warrant” and collectively, the “Private Placement Warrants”), at a price of $1.50 per Private Placement Warrant with Crown PropTech Sponsor, generating gross proceeds of approximately $7.5 million.

Upon the closing of the IPO and the Private Placement, approximately $276.0 million ($10.00 per Unit) of the net proceeds of the IPO and certain of the proceeds of the Private Placement were placed in a Trust Account (“Trust Account”), located in the United States with Continental Stock Transfer & Trust Company acting as trustee, and invested only 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 which invest only in direct U.S. government treasury obligations, as determined by us, until the earlier of: (i) the completion of a business combination and (ii) the distribution of the Trust Account as described below.

On February 9, 2023, our shareholders approved an amendment to amend and restate our Amended and Restated Memorandum and Articles of Association to extend the date by which we must consummate an initial Business Combination from February 11, 2023 to February 11, 2024.

If we have not completed a business combination by February 11, 2024 (the “Combination Period”), we will (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to us to pay our income taxes, if any (less up to $100,000 of interest to pay dissolution expenses) divided by the number of the then-outstanding Public Shares, which redemption will completely extinguish Public Shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any); and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the board of directors, liquidate and dissolve, subject in the case of clauses (ii) and (iii), to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our outstanding warrants, which will expire worthless if we fail to consummate a business combination within the Combination Period, including any extension thereto that may be approved by our shareholders.

On August 12, 2022, Dr. Pius Sprenger informed the Board of his decision to resign as Chief Financial Officer and member of the board of directors of the Company (the “Board”), effective immediately. Richard Chera, the Company’s then Chief Executive Officer assumed the duties as the principal financial officer.

In addition, on August 12, 2022, Dr. Martin Enderle informed the Board of his decision to resign as a member of the Board and chair of the Audit Committee, effective immediately. Concurrently with Dr. Enderle’s resignation, Frits van Paasschen, a member of the Board and of the Audit Committee, assumed the role of chair of the Audit Committee.

On January 17, 2023, Richard Chera informed the Company of his decision to resign as Chief Executive Officer (“CEO”), and principal financial and accounting officer of the Company, effective immediately. Mr. Chera’s resignation was voluntary and not the result of any disagreement with the operations, policies or practices of the Company. Mr. Chera shall continue to serve as a director of the Company.

On January 17, 2023, the Board appointed Mr. Gavin Cuneo and Mr. Michael Minnick as co-CEOs of the Company, effective immediately.

Additionally, in connection with this appointment, each of Mr. Cuneo and Mr. Minnick entered into an Indemnity Agreement and a Letter Agreement with the Company on the same terms as the Indemnity Agreements and Letter Agreements entered into by the directors and officers of the Company at the time of the Company’s IPO. In addition, CIIG entered into the Letter Agreement. CIIG also entered into that certain joinder agreement to the Registration Rights Agreement as described in further detail below.

On January 17, 2023, CIIG entered into a Securities Assignment Agreement (the “Assignment Agreement”), by and among Crown PropTech Sponsor, CIIG and Richard Chera, whereby Crown PropTech Sponsor sold, transferred and assigned 5,662,000 Class B ordinary shares of the Company and 250,667 private placement warrants to purchase Class A ordinary shares of the Company to CIIG. In connection with entry into the Assignment Agreement, CIIG (i) entered into a Letter Agreement with the Company (the “Letter Agreement”) and (ii) entered into a joinder agreement to the Registration Rights Agreement entered into by Crown PropTech Sponsor in connection with the Company’s IPO.

Beginning on January 31, 2023, and continuing until the Company’s February 9, 2023 extraordinary general meeting of shareholders “Extraordinary General Meeting”), the Company and CIIG entered into certain non-redemption agreements and assignments of economic interests (the “Non-Redemption Agreements”) with certain investors (the “Non-Redeeming Investors”). The Non-Redemption Agreements provide for the assignment of economic interest of an aggregate of 1,500,000 Class B ordinary shares held by CIIG to the Non-Redeeming Investors in exchange for such Non-Redeeming Investors agreeing to hold and not redeem an aggregate of 4,000,000 Class A ordinary shares at the Extraordinary General Meeting. Pursuant to the Non-Redemption Agreements, CIIG has agreed to transfer to such Non-Redeeming Investors an aggregate of 1,500,000 Class A ordinary shares upon conversion of the Class B ordinary shares in connection with the consummation of an initial Business Combination.

On May 5, 2023, Frits van Paasschen, a member of the Board and chair of the Audit Committee, chair of the Nominating and Corporate Governance Committee, and a member of the Compensation Committee, notified the Board of his resignation from the Board, effective upon the acceptance by the Board, which the Board accepted on May 8, 2023. Mr. van Paasschen’s resignation was voluntary and not the result of any disagreement with the operations, policies or practices of the Company.

On May 8, 2023, the Board elected Chris Rogers as a member of the Board, chair of the Audit Committee, a member of the Nominating and Corporate Governance Committee, and a member of the Compensation Committee, effective immediately.

Termination of the Proposed Brivo Transaction

On November 10, 2021, we entered into a business combination agreement (the “BCA” or the “Business Combination Agreement”), by and among (i) the Company, (ii) Crown PropTech Merger Sub I Corp, a Delaware corporation and wholly owned direct subsidiary of Crown (“Merger Sub I”), (iii) Crown PropTech Merger Sub II LLC, a Delaware limited liability company and a wholly owned subsidiary of Crown (“Merger Sub II”, and together with Merger Sub I the “Merger Subs”) and (iv) Brivo, Inc., a Nevada corporation (“Brivo” and all the parties to the Business Combination Agreement, the “Parties to the Business Combination Agreement”) (the “Business Combination”). The obligation of Brivo to consummate the Business Combination was subject to certain closing conditions, including, but not limited to, the aggregate cash proceeds from Crown’s trust account, together with the proceeds from the sale of the PIPE Notes (as defined below).

In connection with the signing of the Business Combination Agreement, we entered into subscription agreements (the “Subscription Agreements”) with certain investors (the “PIPE Investors”). Pursuant to the terms of the Subscription Agreements, each PIPE Investor had the right to terminate its Subscription Agreement after July 9, 2022, if the closing of the Business Combination had not occurred as of such date or at any date and time as the Business Combination Agreement is validly terminated.

Golub Capital LLC and its affiliates (together with its affiliates, “Golub”), a PIPE Investor, subscribed for PIPE Notes with an aggregate principal amount of $68 million. On July 11, 2022, we received a notice of election from Golub, notifying us that Golub has elected to terminate Golub’s Subscription Agreement because the Business Combination had not been consummated by July 9, 2022.

On August 10, 2022, we received a notice of election from Brivo, notifying us that Brivo has elected to terminate the Business Combination. As a result of such election, the Business Combination was immediately terminated. In addition, the rest of the Subscription Agreements were automatically terminated.

Following a confidential settlement arrangement, we are no longer pursuing any remedies in connection with the termination of the Brivo Business Combination.

On January 13, 2023, the Company formally withdrew its Form S-4 Registration Statement from the SEC associated with the BCA.

Settlement of Payables

In April and January 2023 and December 2022, the Company settled $400,000, $377,871 and $6,472,941, respectively, for an aggregate $7,250,812 due to vendors and related parties. In addition, in December 2022, the underwriters agreed to waive their right to receive the deferred underwriting discount of $0.35 per Unit, or $9,660,000 in the aggregate, that was to be payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes an initial business combination.

Results of Operations and Known Trends or Future Events

We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities, those necessary to prepare for the Initial Public Offering and identifying a target company for our initial business combination. We do not expect to generate any operating revenues until after completion of our initial business combination. We generate non-operating income in the form of interest income on cash and cash equivalents held in the trust account. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

For the three months ended June 30, 2023, we had a net income of $860,209. We had a settlement of payables of $400,000, a change in fair value of warrant liability of $284,266 and income on our trust account for $511,717, partially offset by $335,774 of operating costs.

For the six months ended June 30, 2023, we had a net income of $604,337. We incurred income on our trust account for $2,213,036 and settled payables $777,871, partially offset by $1,249,503 of operating costs consisting mostly of legal fees and had a change in fair value of warrant liability of $1,137,067.

For the three months ended June 30, 2022, we had a net income of $212,753. We incurred $2,311,262 of operating costs consisting mostly of legal fees, generated income on our trust account for $392,015 and had a change in fair value of warrant liability of $2,132,000.

For the six months ended June 30, 2022, we had a net income of $3,569,242. We incurred $3,525,566 of operating costs consisting mostly of legal fees, generated income on our trust account for $414,541, and had a change in fair value of warrant liability of $6,680,267.

Liquidity, Capital Resources and Going Concern

On February 11, 2021, we consummated our IPO of 27,600,000 Units, at a price of $10.00 per Unit, which included the exercise of the underwriters’ option to purchase an additional 3,600,000 Units at the IPO price to cover over-allotments. The Units were sold, generating gross proceeds of $276,000,000. Substantially concurrently with the closing of the IPO, we completed the private sale of 5,013,333 Private Placement Warrants to Crown PropTech Sponsor and the Anchor Investor at a purchase price of $1.50 per Private Placement Warrant, generating gross proceeds to the Company of $7,520,000.

Following the IPO, the sale of the Private Placement Warrants, and the underwriters’ election to fully exercise their over-allotment option, a total of $276,000,000 was placed in the Trust Account at J.P. Morgan Chase Bank, N.A., maintained by Continental Stock Transfer & Trust Company, acting as trustee, and we had $1,919,091 of cash held outside of the Trust Account, after payment of costs related to the IPO, and available for working capital purposes. We incurred $16,505,915 in transaction costs, including $5,520,000 of underwriting fees, $9,660,000 of deferred underwriting fees, $795,825 of excess fair value of the Anchor Investor shares and $530,090 of other offering costs. In December 2022, the underwriters agreed to waive their right to receive any additional deferred underwriting discount.

For the six months ended June 30, 2023, cash used in operating activities was $509,861, resulting primarily from the net income of $604,337 which was impacted by unrealized loss on change in fair value of warrant liabilities of $1,137,067, settlement of payables $777,871, trust dividend income of $2,213,036 and changes in operating assets and liabilities of $739,642.

For the six months ended June 30, 2022, cash used in operating activities was $10,229, resulting primarily from the net income of $3,569,242 which was impacted by unrealized gain on change in fair value of warrant liabilities of $6,680,267 and trust dividend income of $414,541 and offset by changes in operating assets and liabilities used $3,515,337 of cash from operating activities.

As of June 30, 2023 and December 31, 2022, we had cash outside the trust account of $31,048 and $80,212 available for working capital needs and working capital deficits of $1,658,590 and $1,512,654, respectively. All remaining cash held in the trust account is generally unavailable for our use, prior to an initial business combination, and is restricted for use either in a business combination or to redeem ordinary shares. As of June 30, 2023 and December 31, 2022, none of the amount in the trust account was available to be withdrawn as described above.

Through June 30, 2023, our liquidity needs were satisfied through receipt of $25,000 from the sale of the Founder Shares, the remaining net proceeds from the Initial Public Offering, the sale of Private Placement Warrants, the Promissory Note and the Convertible Note (as defined below) and capital contributions from the Sponsors of $673,418.

On November 30, 2021, we entered into a convertible note with Richard Chera, our former Chief Executive Officer and Director, pursuant to which Mr. Chera agreed to loan us up to an aggregate principal amount of $1,500,000 (the “Convertible Note”). The Convertible Note was non-interest bearing and due on the earlier of: (i) 12 months from the date thereof or (ii) the date on which we consummate a business combination. If we do not consummate a business combination, we may use a portion of any funds held outside the trust account to repay the Convertible Note; however, no proceeds from the trust account may be used for such repayment if we do not consummate a business combination. On May 31, 2023, and effective as of January 17, 2023, the Convertible Note was amended and restated (the “A&R Note”) in the aggregate principal amount of up to $1,000,000 to be due on the earlier of: (i) February 11, 2024; (ii) the date on which the Company consummates a Business Combination or (iii) the effective date of a liquidation of the Company. Additionally, due to a waiver by Mr. Chera, the A&R Note no longer provides for the Conversion Right.

Commitments and Contingencies

Registration Rights

The holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of working capital loans (and any ordinary shares issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the working capital loans and upon conversion of the Founder Shares) are entitled to registration rights pursuant to a registration rights agreement signed prior to the effective date of the IPO requiring the Company to register such securities for resale. The holders of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggyback” registration rights with respect to registration statements filed subsequent to the completion of a business combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements. On November 10, 2021 (but effective as of the closing of the Brivo Business Combination), and as part of the Brivo Business Combination, New Brivo, Crown PropTech Sponsor, Anchor Investor and certain other shareholders and directors and officers of Crown and Brivo entered into the Amended and Restated Registration Rights Agreement. As part of the termination of the Business Combination, the Restated Registration Rights Agreement was automatically terminated.

Underwriting Agreement

A deferred underwriting discount of $0.35 per Unit, or $9,660,000 in the aggregate, was payable to the underwriters from the amounts held in the Trust Account solely in the event that we complete an initial business combination, subject to the terms of the underwriting agreement. In December 2022, the underwriters agreed to waive their right to receive any additional deferred underwriting discount.

Advisory Service Agreements

We may enlist various entities as capital market advisors to assist in the identification and consummation of an initial business combination. Fees for such services will be payable only upon consummation of an initial business combination by us.

During the fourth quarter of 2022, these contracts with the advisors have been terminated and no amounts were paid or due under the contracts.

Administrative Support Agreement

We previously entered into an administrative agreement to pay Crown PropTech Sponsor or an affiliate thereof a total of up to $15,000 per month for office space, utilities, secretarial and administrative support services provided to members of our management team (the “Administrative Support Payments”). Pursuant to a subsequent letter agreement, Crown PropTech Sponsor is no longer entitled to receive any Administrative Support Payments and we are no longer required to pay any such payments. As of June 30, 2023, we have not made any payments pursuant to the administrative agreement and do not expect to incur any related expenses in the near future.

Attorney Fees

We incurred legal fees in connection with the proposed Brivo Business Combination, none of which were payable until consummation of the proposed Brivo Business Combination. As of June 30, 2023, we fully paid a settled amount in legal fees associated with the Brivo Business Combination.

A&R Note

On November 30, 2021, we entered into a convertible promissory note with Richard Chera, our former Chief Executive Officer and Director, pursuant to which Mr. Chera agreed to loan us up to an aggregate principal amount of $1,500,000. On May 31, 2023, and effective as of January 17, 2023, the promissory note was amended and restated in the aggregate principal amount of up to $1,000,000. See “Liquidity and Capital Resources.”

Contractual Obligation

We do not have any long-term debt obligations, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities other than described above.

Critical Accounting Policies

This management’s discussion and analysis of our financial condition and results of operations is based on our unaudited consolidated condensed financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these unaudited consolidated condensed financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our financial statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments and accrued expenses. We base our estimates on historical experience, known trends and events and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Class A Ordinary Shares Subject to Possible Redemption

The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Class A ordinary shares subject to mandatory redemption (if any) are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, Class A ordinary shares are classified as shareholders’ equity. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to the occurrence of uncertain future events. Accordingly, as of June 30, 2023 and December 31, 2022, 4,196,485 and 27,600,000 Class A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’ deficit section of the Company’s balance sheets, respectively.

Net Income per Ordinary Shares

We have two classes of shares, which are referred to as Class A ordinary shares and Class B ordinary shares. Earnings and losses are shared pro rata between the two classes of shares. The 14,213,333 potential ordinary shares for outstanding warrants to purchase our shares were excluded from diluted earnings per share for the three and six months ended June 30, 2023 and 2022 because the warrants are contingently exercisable, and the contingencies have not yet been met. As a result, diluted net income per ordinary share is the same as basic net income per ordinary share for the periods presented.

Anchor Investors

The Company complies with SAB Topic 5.A to account for the valuation of the Founder Shares acquired by the Anchor Investors. The Founder Shares purchased by the Anchor Investors represent a capital contribution for the benefit of the Company and are recorded as offering costs and reflected as a reduction in the proceeds from the offering and offering expenses in accordance with ASC 470 and Staff Accounting Bulletin Topic 5A. As such, upon sale of 690,000 Founder Shares to the Anchor Investors the valuation of these shares was recognized as a deferred offering cost and charged to temporary equity and other expenses. At February 11, 2021, the fair value of the Founder Shares to the Anchor Investors in excess of the amount paid was $795,825.

Recent Accounting Pronouncements

See Note 2 to the financial statements required by Item 1 of this Quarterly Report on Form 10-Q.

Off-Balance Sheet Arrangements

As of June 30, 2023, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K.

JOBS Act

The Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an “emerging growth company” and under the JOBS Act are allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, the unaudited consolidated condensed financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis) and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the chief executive officer’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our IPO or until we are no longer an “emerging growth company,” whichever is earlier.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this Item.

Item 4. Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Co-Chief Executive Officers, to allow timely decisions regarding required disclosure.

Evaluation of Disclosure Controls and Procedures

As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Co-Chief Executive Officers carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2023. Based upon their evaluation, our Co-Chief Executive Officers concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were not effective, due solely to the material weakness in our internal control over financial reporting related to the Company’s accounting for complex financial instruments. As a result, we performed additional analysis as deemed necessary to ensure that our financial statements were prepared in accordance with GAAP. Accordingly, management believes that the financial statements included in this Quarterly Report present fairly in all material respects our financial position, results of operations and cash flows for the period presented.

Management has identified a material weakness in internal controls related to the accounting for complex financial instruments. While we have processes to identify and appropriately apply applicable accounting requirements, we plan to continue to enhance our system of evaluating and implementing the accounting standards that apply to our financial statements, including through enhanced analyses by our personnel and third-party professionals with whom we consult regarding complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the three and six months ended June 30, 2023, covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


Cayman Islands	001-40017	N/A
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification Number)

40 West 57th Street, 29th Floor New York, NY		10019
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A ordinary shares, par value $0.0001 per share	CPTK	New York Stock Exchange
Units, each consisting of one Class A ordinary share and one-third of one redeemable warrant	CPTK.U	New York Stock Exchange


		Page No.
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements		1
	Consolidated Condensed Balance Sheets as of June 30, 2023 (unaudited) and December 31, 2022		1
	Unaudited Consolidated Condensed Statements of Operations for the three and six months ended June 30, 2023 and 2022		2
	Unaudited Consolidated Condensed Statements of Changes in Shareholders’ Deficit for the three and six months ended June 30, 2023 and 2022		3
	Unaudited Consolidated Condensed Statements of Cash Flows for the six months ended June 30, 2023 and 2022		4
	Notes to Unaudited Consolidated Condensed Financial Statements		5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		22
Item 4.	Controls and Procedures		22
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		23
Item 1A.	Risk Factors		23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		23
Item 3.	Defaults Upon Senior Securities		23
Item 4.	Mine Safety Disclosures		23
Item 5.	Other Information		23
Item 6.	Exhibits		24
SIGNATURES			25


	June 30, 2023			December 31, 2022
	(Unaudited)
Assets
Current assets:
Cash	$	31,048		$	80,212
Prepaid expenses		36,626			39,616

Total current assets		67,674			119,828
Investments held in Trust account		43,906,522			279,998,549

Total assets	$	43,974,196		$	280,118,377

Liabilities, Class A ordinary shares subject to possible redemption and Shareholders’ Deficit
Current liabilities:
Accounts payable and accrued expenses	$	925,264		$	627,376
Due to related party		—			339,107
Promissory note		801,000			666,000

Total current liabilities		1,726,264			1,632,483
Warrant liabilities		1,137,067			—

Total liabilities		2,863,331			1,632,483

Commitments
Class A ordinary shares subject to possible redemption, 4,196,485 and 27,600,000 shares at redemption value as of June 30, 2023 and December 31, 2022, respectively		43,906,522			279,998,549
Shareholders’ deficit:
Preference shares, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding		—			—
Class A ordinary shares, $0.0001 par value; 200,000,000 shares authorized; no shares issued or outstanding, excluding 4,196,485 and 27,600,000 shares subject to possible redemption as of June 30, 2023 and December 31, 2022, respectively		—			—
Class B ordinary shares, $0.0001 par value; 20,000,000 shares authorized; 6,900,000 shares issued and outstanding		690			690
Additional paid-in capital		9,853,638			9,527,941
Accumulated deficit		(12,649,985	)		(11,041,286	)

Total shareholders’ deficit		(2,795,657	)		(1,512,655	)

Total liabilities, redeemable shares and shareholders’ deficit	$	43,974,196		$	280,118,377


	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2023			2022			2023			2022
Operating costs	$	335,774		$	2,311,262		$	1,249,503		$	3,525,566

Income (loss) from operations		(335,774	)		(2,311,262	)		(1,249,503	)		(3,525,566	)
Other income:
Trust dividend income		511,717			392,015			2,213,036			414,541
Change in fair value of warrant liabilities		284,266			2,132,000			(1,137,067	)		6,680,267
Settlement of payables		400,000			—			777,871			—

Total other income, net		1,195,983			2,524,015			1,853,840			7,094,808

Net income	$	860,209		$	212,753		$	604,337		$	3,569,242

Weighted average redeemable shares outstanding		4,196,485			27,600,000			9,239,231			27,600,000

Basic and diluted net income per redeemable share	$	0.08		$	0.01		$	0.04		$	0.10

Weighted average non-redeemable shares outstanding		6,900,000			6,900,000			6,900,000			6,900,000

Basic and diluted net income per ordinary share	$	0.08		$	0.01		$	0.04		$	0.10


	Ordinary Shares				Additional Paid-in Capital			Accumulated Deficit			Total Shareholders’ Deficit
	Class B
	Shares		Amount
Balance as of December 31, 2022		6,900,000	$	690	$	9,527,941		$	(11,041,286	)	$	(1,512,655	)
Capital contribution from Sponsors		—		—		8,000			—			8,000
Remeasurement of ordinary shares subject to redemption value		—		—		—			(1,701,319	)		(1,701,319	)
Non-redemption agreements (see Note 2)		—		—		(1,156,500	)		—			(1,156,500	)
Capital contribution from non-redemption agreements		—		—		1,156,500			—			1,156,500
CIIG Securities Assignment Agreement (see Note 2)		—		—		—			(2,837,593	)		(2,837,593	)
Excess value of CIIG Securities Assignment Agreement		—		—		—			2,837,593			2,837,593
Net loss		—		—		—			(255,872	)		(255,872	)

Balance as of March 31, 2023		6,900,000		690	$	9,535,941			(12,998,477	)		(3,461,846	)

Capital contribution from Sponsor						317,697						317,697
Remeasurement of ordinary shares subject to redemption value		—		—		—			(511,717	)		(511,717	)
Net income		—		—		—			860,209			860,209

Balance as of June 30, 2023		6,900,000	$	690	$	9,853,638		$	(12,649,985	)	$	(2,795,657	)


Exhibit Number		Description

3.1		Second Amended and Restated Memorandum and Articles of Association (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on February 9, 2023, (SEC file no. 001-40017)).

10.1		Letter Agreement, dated January 17, 2023, by and among Crown PropTech Acquisitions, Crown PropTech Sponsor, LLC, Richard Chera and CIIG Management III LLC (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed January 17, 2023 (SEC file no. 001-40017)).

10.2		Amended and Restated Promissory Note, dated May 31, 2023, issued by Crown PropTech Acquisitions to Richard Chera (incorporated by reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q filed on June 2, 2023 (SEC file no. 001-40017)).

31.1*		Certification of Co-Chief Executive Officer (Principal Executive Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of Co-Chief Executive Officer (Principal Financial and Accounting Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**		Certification of Co-Chief Executive Officer (Principal Executive Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**		Certification of Co-Chief Executive Officer (Principal Financial and Accounting Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)


	CROWN PROPTECH ACQUISITIONS

Date: August 14, 2023	By:	/s/ Gavin M. Cuneo
	Name:	Gavin M. Cuneo
	Title:	Co-Chief Executive Officer
		(Principal Financial and Accounting Officer)

	By:	/s/ Michael Minnick
	Name:	Michael Minnick
	Title:	Co-Chief Executive Officer