10-K

Large accelerated filer

Accelerated filer

Non-accelerated
filer

Smaller reporting company

Emerging growth company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM

10-K

(Mark One)

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the period ended December 31, 2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

DHC ACQUISITION CORP.

(Exact name of registrant as specified in its charter)


Cayman Islands	001-40130	98-1541929
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification Number)


535 Silicon Drive, Suite 100 Southlake, Texas		76092
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (310)

228-2894

Not Applicable

(Former name or former address, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class:	Trading Symbol	Name of Each Exchange on Which Registered:
Units, each consisting of one Class A ordinary share, $0.0001 par value, and one-third of one redeemable warrant	DHCAU	The Nasdaq Stock Market LLC
Class A ordinary shares included as part of the units	DHCA	The Nasdaq Stock Market LLC
Redeemable warrants included as part of the units, each whole warrant exercisable for one Class A Ordinary Share at an exercise price of $11.50	DHCA	The Nasdaq Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation

S-T

(§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a

non-accelerated

filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer, “smaller reporting company” and “emerging growth company” in Rule

12b-2

of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule

12b-2

of the Exchange Act). Yes ☒ No ☐

As of March

, 2022, there were 30,945,072 Class A ordinary shares, $0.0001 par value and 7,736,268 Class B ordinary shares, $0.0001 par value, issued and outstanding. The aggregate market value of the Class A ordinary shares outstanding, other than shares held by persons who may be deemed affiliates of the registrant, computed by reference to the closing sales price for the ordinary shares on December 31, 2021, as reported on The Nasdaq Stock Market LLC, was $302,642,804.16.


Auditor Firm ID: 100		Auditor Name: WithumSmith+Brown, PC		Auditor Location: New York, New York

Documents Incorporated by Reference: None.

Table of Contents

TABLE OF CONTENTS


	Page

PART I		4

ITEM 1. BUSINESS		4

Item 1A. Risk Factors		22

Item 1B. Unresolved Staff Comments		57

Item 2. Properties		58

Item 3. Legal Proceedings		58

Item 4. Mine Safety Disclosures		58

PART II		59

Item 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities		59

Item 6. Selected Financial Data		60

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations		60

Item 7A. Quantitative and Qualitative Disclosures about Market Risk		63

Item 8. Financial Statements and Supplementary Data		63

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		63

Item 9A. Controls and Procedures.		63

Item 9B. Other Information		64

Part III		65

Item 10. Directors, Executive Officers and Corporate Governance		65

Item 11. Executive Compensation		73

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters		73

Item 13. Certain Relationships and Related Transactions, and Director Independence		74

Item 14. Principal Accountant Fees and Services		76

PART IV		77

Item 15. Exhibits, Financial Statement Schedules		77

Item 16. Exhibits and Financial Statement Schedules.		78

Item 16. Form 10-K Summary		79

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CERTAIN TERMS

Unless otherwise stated in this Report, references to:

•

“amended and restated memorandum and article of association” are to the amended and restated memorandum and articles of association that the company adopted in connection with the consummation of our initial public offering;

•

“Companies Act” are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time;

•

“Founders” are to Christopher Gaertner and Thomas Morgan, Jr.;

•

“founder shares” are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to our initial public offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be “public shares”);

•

“initial public offering” refers to our initial public offering units, consisting of one Class A ordinary share and

one-third

of one redeemable warrant;

•

“management” or our “management team” are to our executive officers and directors;

•

“ordinary shares” are to our Class A ordinary shares and our Class B ordinary shares;

•

“private placement warrants” are to the warrants issued to our sponsor in a private placement simultaneously with the closing of our initial public offering and upon conversion of working capital loans, if any;

•

“public shares” are to our Class A ordinary shares sold as part of the units in our initial public offering (whether they are purchased in our initial public offering or thereafter in the open market);

•

“public shareholders” are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor’s and each member of our management team’s status as a “public shareholder” will only exist with respect to such public shares;

•

“sponsor” are to DHC sponsor, LLC, a Delaware limited liability company; and

•

“we,” “us,” “our,” “company” or “our company” are to DHC Acquisition Corp., a Cayman Islands exempted company.

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS AND RISK FACTOR SUMMARY

This annual report on Form

10-K

(this “Report”), including, without limitation, statements under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”). These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology.

The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, the following risks, uncertainties (some of which are beyond our control) or other factors:

•

we have no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective;

•

our ability to select an appropriate target business or businesses;

•

our ability to complete our initial business combination;

•

our expectations around the performance of a prospective target business or businesses;

•

our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination;

•

our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination;

•

the lack of a market for our public securities;

•

our potential ability to obtain additional financing to complete our initial business combination;

•

our pool of prospective target businesses;

•

our ability to consummate an initial business combination due to the uncertainty resulting from the recent

COVID-19

pandemic;

•

the ability of our officers and directors to generate a number of potential business combination opportunities;

•

our public securities’ potential liquidity and trading;

•

the use of proceeds not held in the trust account (as described below) or available to us from interest income on the trust account balance;

•

the trust account not being subject to claims of third parties;

•

our financial performance; or

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•

the other risks and uncertainties discussed in “Risk Factors” and elsewhere in this Report.

The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the section of this Report entitled “Risk Factors.”

Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

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PART I

ITEM 1. BUSINESS

Summary

General

We are a recently organized blank check company incorporated as a Cayman Islands corporation and formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this Report as our initial business combination. We have generated no operating revenues to date and we do not expect that we will generate operating revenues until we consummate our initial business combination. We are a “shell company” as defined under the Exchange Act because we have no operations and nominal assets consisting almost entirely of cash. To date, our efforts have been limited to organizational activities and activities related to our initial public offering as well as the search for a prospective business combination target.

On March 4, 2021, Company consummated its initial public offering of 30,000,000 units, at an offering price of $10.00 per Unit and a private placement with DHC Acquisition LLC of 6,000,000 private placement warrants at a price of $1.00 per warrant. On March 5, the Company consummated a partial exercise by the underwriters of the initial public offering of their over-allotment option for 945,072 units (the “Overallotment Units”) and 126,010 private placement warrants (together with the private placement warrants offered and sold in our initial public offering, the “Private Placement”). The net proceeds from our initial public offering and the Overallotment Units together with certain of the proceeds from the Private Placement, $309,450,720 in the aggregate, were placed in a trust account established for the benefit of the Company’s public shareholders and the underwriters of the initial public offering with Continental Stock Transfer & Trust Company acting as trustee.

Business Strategy

We believe that our management team is well positioned to identify acquisition opportunities in the marketplace and that our contacts and transaction sources, ranging from owners and directors of private and public companies, private equity and venture capital funds, investment bankers, lenders, attorneys, accountants and other trusted advisors across various sectors, will allow us to generate attractive acquisition opportunities.

Our strategy is to identify, acquire and, after our initial business combination, help build and grow, a U.S. or

non-U.S.

technology and technology-enabled business in the automotive, consumer, aerospace/defense, enterprise software or

E-commerce

sector. We plan to continue to seek potential targets which we believe can materially grow revenue and earnings both organically and inorganically through the efforts of a combined management team following the completion of the initial business combination. These types of companies manufacture and/or distribute products or provide services to a broad range of customers and

end-use

markets. We believe that technology companies in private markets are fundamentally changing global commerce at an unparalleled pace by forming new markets, delivering new customer experiences and disrupting and disintermediating legacy industries. Nimble privately held technology companies are leveraging these advances and practices to innovate new business models and address market needs that will enable them to reach significant scale and drive shareholder value. DHC Acquisition Corp. is focused on the nexus of where technology and the largest legacy markets are intersecting. By leveraging the management team’s collective contacts and transaction sources, ranging from owners and directors of private and public companies, private equity and venture capital funds, investment bankers, lenders, attorneys, accountants and other trusted advisors across various sectors, we believe attractive acquisition opportunities can be identified and pursued.

Specifically, we believe the following investment highlights and value propositions can help us to identify an opportunity and allow for a successful transaction:

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Proprietary Network of Leading Industry Relationships, Sourcing Channels, and Third-Party Advisors from Across the Business World

We utilize what our management team believes is an accomplished and proven network of direct and third-party advisor relationships to assist with target company origination and evaluation, due diligence and implementation of value creation programs and activities in connection with and following our initial business combination. We believe that Mr. Gaertner’s extensive relationships developed over a

25-year

career in investment banking for technology companies as well as his experience as a financial services professional, will help us to identify and complete an attractive business combination. In addition, the unique experience and professional network of each member of our board of directors help us facilitate connectivity to owners and directors of private and public companies, private equity and venture capital funds, investment bankers, lenders, attorneys, accountants, financial intermediaries, and other trusted advisors.

Strong M&A and Public Capital Markets Track Record

We believe that potential sellers of target businesses will view our management’s deep, full cycle experience as an advisor in leading over 100 initial public offerings and M&A transactions and the relationships cultivated with the investment community, as a set of differentiated capabilities. These abilities may be attractive to counterparties, allowing them to focus on operating the company rather than the significant demands imposed by a traditional initial public offering or sale process. The fact that members of our management team have successfully advised on numerous business combinations and capital markets transactions and have overseen the management of over half a billion dollars of capital is a positive factor in considering whether or not to enter into a business combination with us.

Board of Directors Composed of Seasoned Executives, Experienced in Growing Industry-Leading Companies at Scale and Overseeing Transformative Business Combinations

We have recruited and organized a group of three highly accomplished and engaged independent directors who bring with them public company governance, executive leadership, operations oversight and capital markets expertise. Our Board members have served as directors, chief executive officers or in other executive and advisory capacities for numerous publicly listed and privately-owned companies. Our directors have extensive experience with acquisitions, divestitures and corporate strategy and possess relevant domain expertise in the sectors where we expect to source business combination targets including, but not limited to, the automotive, consumer, aerospace/defense, enterprise software and

E-commerce

sectors. We believe their collective expertise, contacts and relationships make us a highly competitive and desirable merger partner.

Ability to Leverage Our Deep Operational and Management Expertise

Our management team includes industry experts with the ability to identify attractive business combination candidates and capitalize on favorable industry trends. The breadth and depth of our operating and investing experience will enable us to consider candidates in multiple sectors within the technology industry and target areas with compelling potential returns. Additionally, members of our board of directors have led large public and private companies through transformative transactions and strategic decisions and bring a wealth of executive experience and insight to our decision-making process. We believe this experience makes us very well suited to identify, source, negotiate and execute an initial business combination.

Long-Term Partnership Approach

Our management has a history of acting as a long-term partner to clients, serving as a trusted advisor to growth companies through their lifecycle, to established companies undergoing transition as well as to business leaders and families on generational wealth management. By partnering with DHC Acquisition Corp., sellers of potential target businesses will be able to take control of the capital markets process and accelerate and

de-risk

their path to public company status rather than undergo a traditional initial public offering process. We believe we are unique among listed SPAC vehicles due to our management’s extensive research, analysis, experience and focus with respect to the acceleration of technology cycles, including the disintermediation of existing businesses, the transformation of legacy companies, the creation of new verticals and growth of market capitalization.

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Acquisition Criteria

Consistent with our strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to seek to acquire one or more businesses that we believe:

•

are in the technology industry and can benefit from the extensive networks and insights we have built. In addition, we expect to evaluate targets in related industries that can use technology to drive meaningful operational improvements and efficiency gains, or enhance their strategic positions by using technology solutions to differentiate offerings;

•

have strong, experienced management teams, or provide a platform to assemble an effective management team with a track record of driving growth and profitability;

•

will likely be well received by public investors and are expected to have good access to the public capital markets;

•

can benefit from attracting incremental capital in connection with the initial business combination by pursuing growth opportunities both operationally and through merger and acquisition activity after the initial business combination;

•

are at an inflection point, such as those requiring additional management expertise, are able to innovate by developing new products or services, or where we believe we can drive improved financial performance and where an acquisition may help facilitate growth through merger and acquisition activity in the future. We believe that we are well-positioned to evaluate and improve a company’s growth prospects and help it realize the opportunities to create shareholder value following the consummation of a business combination;

•

have a leading or niche market position and that demonstrate advantages when compared to their competitors, which may help to create barriers to entry against new competitors;

•

our management team understands well, including those businesses where we believe we can drive meaningful operational improvements and efficiency gains, or enhance its strategic position by using technology solutions to differentiate its offering;

•

have significant embedded and/or underexploited expansion opportunities. This can be accomplished through a combination of accelerating organic growth and finding attractive

add-on

acquisition targets. Our management team has significant experience in advising companies in transformati

SEC Form 10-K filed by DHC Acquisition Corp.