Risk Factors - CFFS

-New additions in green
-Changes in blue
-Hover to see similar sentence in last filing

$CFFS Risk Factor changes from 00/03/31/22/2022 to 00/03/28/24/2024

Item 1A. Risk Factors. As a smaller reporting company under Rule 12b-2 of the Exchange Act, we are not required to include risk factors in this Report. As a smaller reporting company, we are not required to include risk factors in this Report. However, the following is a partial list of material risks, uncertainties and other factors that could have a material effect on us and our operations: ● We are a blank check company and an early stage company with no revenue or basis to evaluate our ability to select a suitable business target. However, below is a partial list of material risks, uncertainties and other factors that could have a material effect on the Company and its operations: ●We are a blank check company with no revenue or basis to evaluate our ability to select a suitable business target. ●We may not be able to select an appropriate target business or businesses and complete our initial business combination in the prescribed time frame. ●Our expectations around the performance of a prospective target business or businesses may not be realized. ●We may not be successful in retaining or recruiting required officers, key employees or directors following our initial business combination. ●Our officers and directors may have difficulties allocating their time between the Company and other businesses and may potentially have conflicts of interest with our business or in approving our initial business combination. ●We may not be able to obtain additional financing to complete our initial business combination or reduce the number of stockholders requesting redemption. ●We may issue our shares to investors in connection with our initial business combination at a price that is less than the prevailing market price of our shares at that time. ●You may not be given the opportunity to choose the initial business target or to vote on the initial business combination. ●Trust account funds may not be protected against third party claims or bankruptcy. ● An active market for our public securities’ may not develop and our stockholders will have limited liquidity and trading. ●An active market for our public securities’ may not develop and you will have limited liquidity and trading. ●Our financial performance following a business combination may be negatively affected by their lack an established record of revenue, cash flows and experienced management. ●Our financial performance following a business combination with an entity may be negatively affected by their lack an established record of revenue, cash flows and experienced management. ●Members of our management team and board of directors have significant experience as founders, board members, officers, executives or employees of other companies. ●Members of our management team and board of directors have significant experience as founders, board members, officers, executives or employees of other companies. Certain of those persons have been, may be, or may become, involved in litigation, investigations or other proceedings, including related to those companies or otherwise. The defense or prosecution of these matters could be time-consuming and could divert our management’s attention, and may have an adverse effect on us, which may impede our ability to consummate an initial business combination. ●There may be more competition to find an attractive target for an initial business combination, which could increase the costs associated with completing our initial business combination and may result in our inability to find a suitable target. ●There may be more competition to find an attractive target for an initial business combination, which could increase the costs associated with completing our initial business combination and may result in our inability to find a suitable target. 19 ●Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination. 19 ●Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination. ●We may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability. ●We may engage one or more of the underwriters from our initial public offering or one of their respective affiliates to provide additional services to us, which may include acting as a financial advisor in connection with an initial business combination or as placement agent in connection with a related financing transaction. CF&Co. is entitled to receive the Marketing Fee that will be released from the trust account only upon completion of an initial business combination. is entitled to receive a business combination marketing fee that will be released from the trust account only upon a completion of an initial business combination. These financial incentives may cause them to have potential conflicts of interest in rendering any such additional services to us, including, for example, in connection with the sourcing and consummation of an initial business combination. ●We may attempt to complete our initial business combination with a private company about which little information is available, which may result in a business combination with a company that is not as profitable as we suspected, if at all. ●Since our initial stockholders will lose their entire investment in us if our initial business combination is not completed (other than with respect to any public shares they may acquire during or after our initial public offering), and because the sponsor and our officers and directors may profit substantially even under circumstances in which our public stockholders would experience losses in connection with their investment, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. ●The value of the founder shares following completion of our initial business combination is likely to be substantially higher than the nominal price paid for them, even if the trading price of our common stock at such time is substantially less than $10.00 per share. ● Resources could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. ●Resources could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we have not completed our initial business combination by the end of the Combination Period, our public stockholders may receive only approximately $10. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10. 84 per share as of December 31, 2023 (which amount takes into account our estimate of interest that may be withdrawn to pay our taxes (other than Excise Tax) and the $100,000 of interest that may be withdrawn to pay dissolution expenses and is subject to our right to withdraw interest from the trust account to pay any additional taxes (other than Excise Tax)) or less than such amount in certain circumstances, on the liquidation of the trust account and our warrants will expire worthless. ●Our search for an initial business combination, and any target business with which we may ultimately consummate an initial business combination, may be materially adversely affected by current global geopolitical conditions resulting from the ongoing Russia-Ukraine conflict and the recent escalation of the conflict in the Middle East. 20 ●Military or other conflicts in Ukraine, the Middle East or elsewhere and other disruptions to the equity or debt capital markets, including as a result of inflation in the United States and elsewhere, may lead to increased volume and price volatility for publicly traded securities, or affect the operations or financial condition of potential target companies, which could make it more difficult for us to consummate an initial business combination. ●There may be fewer attractive targets available for acquisition due to the increased number of SPACs that have gone public in recent years and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination. ●Adverse developments affecting the financial services industry, including events or concerns involving liquidity, defaults or non-performance by financial institutions, could adversely affect our business, financial condition or results of operations, or our prospects. ●We may not be able to complete an initial business combination with certain potential target companies if a proposed transaction with the target company may be subject to review or approval by regulatory authorities pursuant to certain U.S. or foreign laws or regulations, including the Committee on Foreign Investment in the United States. ● The Excise Tax may be imposed on us in connection with our redemptions of shares in connection with a business combination or other stockholder vote pursuant to which stockholders would have a right to submit their shares for redemption. ●The Second Extension may cause us to contravene Nasdaq rules if the Combination Period is extended past 36 months from our initial public offering and, as a result, Nasdaq could suspend trading in our securities or delist our securities from Nasdaq. ●There is substantial doubt about our ability to continue as a “going concern”. 21 Cyber incidents or attacks directed at us or third parties could result in information theft, data corruption, operational disruption and/or financial loss. We depend on digital technologies provided by third parties, including information systems, infrastructure and cloud applications and services. Because of our reliance on the technologies of third parties, we also depend upon the personnel and the processes of third parties to protect against cybersecurity threats, and we have no personnel or processes of our own for this purpose. Sophisticated and deliberate attacks on, or security breaches in, the systems or infrastructure that we use could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data and could have a material adverse effect on our business, financial condition or reputation. Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial business combination and results of operations. We are subject to laws and regulations enacted by national, regional and local governments. In particular, we are required to comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our business and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to negotiate and complete our initial business combination, and our results of operations. On January 24, 2024, the SEC adopted the 2024 SPAC Rules requiring, among other matters, (i) additional disclosures relating to SPAC business combination transactions, (ii) additional disclosures relating to dilution and to conflicts of interest involving sponsors and their affiliates in both SPAC initial public offerings and business combination transactions, (iii) additional disclosures regarding projections included in SEC filings in connection with proposed business combination transactions, and (iv) the requirement that both the SPAC and its target company be co-registrants for business combination registration statements. In addition, the SEC’s adopting release provided guidance describing circumstances in which a SPAC could become subject to regulation under the Investment Company Act, including its duration, asset composition, business purpose, and the activities of the SPAC and its management team in furtherance of such goals. Compliance with the 2024 SPAC Rules and related guidance may (i) increase the costs of and the time needed to negotiate and complete an initial business combination, (ii) adversely affect our ability to complete an initial business combination, and (iii) cause us to liquidate at an earlier time than we might otherwise choose. If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete our initial business combination. The SEC’s adopting release with respect to the 2024 SPAC Rules provided guidance relating to the potential status of SPACs as investment companies subject to regulation under the Investment Company Act and the regulations thereunder. Whether a SPAC is an investment company is dependent on specific facts and circumstances and we can give no assurance that a claim will not be made that we have been operating as an unregistered investment company. If we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including (i) restrictions on the nature of our investments; and (ii) restrictions on the issuance of securities, each of which may make it difficult for us to complete our initial business combination. 22 In addition, we may have imposed upon us burdensome compliance requirements, including: (i) registration as an investment company; (ii) adoption of a specific form of corporate structure; and (iii) reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations. In order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business other than investing, reinvesting or trading in securities and that our activities do not include investing, reinvesting, owning, holding or trading “investment securities” constituting more than 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. We are mindful of the SEC’s investment company definition and guidance and intend to complete an initial business combination with an operating business, and not with an investment company, or to acquire minority interests in other businesses exceeding the permitted threshold. We do not believe that our business activities will subject us to regulation as an investment company under the Investment Company Act. To this end, the proceeds held in the Trust Account were initially invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government securities. The holding of the assets in the trust account in such permitted investments was intended to be temporary and for the sole purpose of facilitating an initial business combination. To mitigate the risk that we might be deemed to be an investment company for purposes of the Investment Company Act, which risk increased the longer that we held investments in the trust account, in December 2023, we instructed Continental, as trustee of the trust account, to liquidate the investments held in the trust account and instead to hold the funds in the trust account in cash or in an interest bearing demand deposit account at a bank. Pursuant to the Trust Agreement, Continental is not permitted to invest in securities or assets other than as described above. By restricting the investment of the proceeds to these instruments, and by having a business plan targeted at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a merchant bank or private equity fund), we intended to avoid being deemed an investment company within the meaning of the Investment Company Act. The trust account is intended solely as a temporary depository for funds pending the earliest to occur of: (i) the completion of our initial business combination; (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend the Charter (x) in a manner that would affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within the Combination Period; or (y) with respect to any other provision relating to the rights of holders of shares of our Class A common stock or pre-initial business combination activity; or (iii) absent an initial business combination within the Combination Period, our return of the funds held in the trust account to our public stockholders as part of our redemption of the public shares. We are aware of litigation claiming that certain SPACs should be considered investment companies. Although we believe that these claims are without merit, we cannot guarantee that we will not be deemed to be an investment company and thus subject to the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds and may hinder our ability to complete an initial business combination or may result in our liquidation. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.84 per public share as of December 31, 2023 (which amount takes into account our estimate of interest that may be withdrawn to pay our taxes (other than Excise Tax) and the $100,000 of interest that may be withdrawn to pay dissolution expenses) and our warrants will expire worthless.

23 For additional risks relating to our operations, other than as set forth above, see the section titled “Risk Factors” contained in our (i) Registration Statement, (ii) Annual Reports on Form 10-K for the years ended December 31, 2022 and 2021, as filed with the SEC on March 31, 2023 and March 31, 2022, respectively, (iii) Quarterly Reports on Form 10-Q for the quarters ended March 31, 2022, June 30, 2022 and September 30, 2022, as filed with the SEC on May 13, 2022, August 12, 2022 and November 14, 2022, respectively, and (iv) Definitive Proxy Statements on Schedule 14A as filed with the SEC on May 19, 2023, December 8, 2023 and February 16, 2024. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risks could arise that may also affect our business or ability to consummate an initial business combination. We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future filings with the SEC. Item 1B. Item 1B. Unresolved Staff Comments. Not applicable. Item 1C. Item 1B. Cybersecurity. As a blank check company, we do not have any operations and our sole business activity has been to search for and consummate an initial business combination. However, because the assets in our trust account are held in a demand deposit account at a bank and we also depend on the digital technologies of third parties, we and third parties may be subject to attacks on or security breaches in our or their systems. Because of our reliance on the technologies of third parties, we also depend upon the personnel and the processes of third parties to protect against cybersecurity threats, and we have no personnel or processes of our own for this purpose. Our board and audit committee oversee risk for our company and are generally responsible for the oversight of risks from cybersecurity threats. Our management will promptly report to our board and audit committee any cybersecurity incidents impacting us and the measures that may be taken to mitigate such incidents. In the event of a cybersecurity incident, we intend to follow an incident response plan, which outlines the steps to be followed from incident identification, mitigation, recovery and notification to legal counsel and our board and audit committee. It is possible that the occurrence of any cybersecurity incidents, or a combination of them, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data and could have a material adverse effect on our business, financial condition or reputation. We have not encountered any cybersecurity incidents since our initial public offering. .