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As confidentially submitted to the Securities and Exchange Commission on February 3, 2022

This draft registration statement has not been publicly filed with the Securities and Exchange

Commission and all information herein remains strictly confidential

Registration No. 333-          

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

Comera Life Sciences Holdings, Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

Delaware   2834   87-4706968

(State or other jurisdiction of

incorporation or organization)

 

(Primary Standard Industrial

Classification Code Number)

 

(I.R.S. Employer

Identification No.)

12 Gill Street

Suite 4650

Woburn, Massachusetts 01801

Telephone: (617) 871-2101

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

 

 

Jeffrey Hackman

President and Chief Executive Officer

Comera Life Sciences Holdings, Inc.

Telephone: (617) 871-2101

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

Copy to:

 

Janeane R. Ferrari, Esq.

Loeb & Loeb LLP

345 Park Avenue

New York, NY 10154

(212) 407-4000

 

Flora R. Perez, Esq.

Laurie L. Green, Esq.

Greenberg Traurig, P.A.

401 East Las Olas Boulevard, Suite 2000

Fort Lauderdale, FL 33301

(954) 765-0500

 

 

Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement becomes effective and on completion of the business combination described in the enclosed proxy statement/prospectus.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box:  ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

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.

 

Large accelerated filer      Accelerated filer  
Non-accelerated filer      Smaller reporting company  
     Emerging growth company  

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 7(a)(2)(B) of the Securities Act.  ☐

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)  ☐

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)  ☐

 

 

 


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Explanatory Note

Pursuant to applicable legislation, we are omitting any financial statements for the nine months ended September 30, 2021, and the year ended December 31, 2019, because they relate to historical periods that we believe will not be required to be included in this proxy statement/prospectus at the time of the contemplated offering. We intend to amend this Registration Statement to include all financial information required by Regulation S-X prior to effectiveness of this Registration Statement.


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The information in this preliminary proxy statement/prospectus is not complete and may be changed. The securities described herein may not be sold until the registration statement filed with the U.S. Securities and Exchange Commission is declared effective. This preliminary proxy statement/prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

 

SUBJECT TO COMPLETION, DATED FEBRUARY 3, 2022

PRELIMINARY PROXY STATEMENT/PROSPECTUS

Comera Life Sciences Holdings, Inc.

[] Shares of Common Stock

[] Warrants

On January 31, 2022, Comera Life Sciences Holdings, Inc., a Delaware corporation (“Holdco”), CLS Sub Merger 1 Corp., a Delaware corporation and newly formed, wholly-owned subsidiary of Holdco (“Comera Merger Sub”), CLS Sub Merger 2 Corp., a Delaware corporation and newly formed, wholly-owned subsidiary of Holdco (“OTR Merger Sub”), OTR Acquisition Corp., a Delaware corporation (“OTR”) and Comera Life Sciences, Inc., a Delaware corporation (“Comera”), entered into a Business Combination Agreement (as it may be amended and/or restated from time to time, the “Business Combination Agreement”). If the Business Combination Agreement and the transactions contemplated thereby are adopted and approved by OTR’s stockholders, and the business combination is subsequently completed, (i) Comera Merger Sub will be merged with and into Comera, with Comera surviving such merger as a direct wholly-owned subsidiary of Holdco (the “Comera Merger”) and (ii) OTR Merger Sub will be merged with and into OTR, with OTR surviving such merger as a direct wholly-owned subsidiary of Holdco (the “OTR Merger”) (collectively with the other transactions described in the Business Combination Agreement, the “Business Combination”).

Upon the closing of the Business Combination (the “Closing”), by virtue of the Comera Merger, all shares of Comera common stock issued and outstanding immediately prior to the Closing (including shares of Comera common stock issued upon conversion of Comera preferred stock immediately prior to the Closing) will be canceled and converted into the right to receive shares of Holdco common stock, all Comera vested in-the-money stock options outstanding will be canceled and converted into the right to receive shares of Holdco common stock and all outstanding Comera unvested stock options and Comera vested out-of-the-money options will be converted into options to purchase shares of Holdco common stock. The aggregate transaction consideration to be paid in the Comera Merger will be a number of shares of Holdco common stock equal to $126 million divided by $10.00. The aggregate transaction consideration will be allocated among the holders of shares of Comera common stock (including Comera common stock issued upon the conversion of Comera preferred stock) and holders of Comera in-the-money stock options.

In addition, at the Closing, Holdco will place 3,150,000 shares of Holdco Common Stock (the “Earn-Out Shares”) into escrow. If, at any time during the period beginning on the Closing Date and expiring at the close of business on the second anniversary of the Closing Date, the volume-weighted average price of Holdco Common Stock is equal to or greater than $12.50 for any 20 trading days within a period of 30 consecutive trading days (the “Earn-Out Trigger”), then within 10 business days following the achievement of the Earn-Out Trigger, the Earn-Out Shares will be released to the holders of Comera Common Stock and holders of Comera Vested In-the-Money Options on a pro rata basis.

In addition, upon the Closing, by virtue of the OTR Merger, all shares of common stock of OTR issued and outstanding immediately prior to the Closing will be converted on a one-to-one basis into the right to receive shares of Holdco common stock and all warrants of OTR outstanding will be converted into warrants to purchase shares of Holdco common stock.

Based on the number of (i) shares of Comera preferred stock outstanding, (ii) shares of Comera common stock outstanding and (iii) outstanding stock options of Comera, in each case as of January 31, 2022, the total number of shares of Holdco common stock expected to be issued in the Comera Merger is approximately 15,750,000, which includes 3,150,000 Earn-Out Shares, and holders of shares of Comera common stock as of immediately prior to the closing of the Business Combination (including Comera common stock issued upon the conversion of Comera preferred stock) are expected to hold, in the aggregate, approximately 54.3% of the issued and outstanding shares of Holdco’s common stock immediately following the closing of the Business Combination. Based on the number of shares of OTR common stock outstanding as of January 31, 2022, the total number of shares of Holdco’s common stock expected to be issued in the OTR Merger is approximately 13,242,017, and holders of shares of OTR common stock as of immediately prior to the closing of the Business Combination are expected to hold, in the aggregate, approximately 45.7% of the issued and outstanding shares of Holdco’s common stock immediately following the closing of the Business Combination.


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The ownership percentages with respect to Holdco following the Business Combination assume (i) all Comera vested, in-the-money options are exercised prior to Closing, (ii) no exercise of warrants of OTR, (iii) no stockholders of OTR exercise redemption rights in connection with their shares of OTR common stock and (iv) all Earn-Out Shares are earned by the Comera stockholders.

OTR’s units, common stock and warrants are currently listed on the Nasdaq, under the symbols “OTRAU,” “OTRA,” and “OTRAW,” respectively. Holdco intends to apply to list the shares of common stock and warrants of Holdco on Nasdaq under the symbols “CMRA” and “CMRAW”, respectively, upon the closing of the Business Combination. We cannot assure you that the Holdco shares of common stock and warrants will be approved for listing on Nasdaq.

See the section entitled “The Business Combination” on page 115 of this proxy statement/prospectus for further information on the consideration being paid to the stockholders of Comera and OTR in the Business Combination.

OTR is holding a special meeting in lieu of its 2022 annual meeting of its stockholders in order to obtain the stockholder approvals necessary to complete the Business Combination. At the OTR special meeting of stockholders, which will be held in a virtual format on [●], 2022, at [●], Eastern time, unless postponed or adjourned to a later date, OTR will ask its stockholders to adopt the Business Combination Agreement, thereby approving the Business Combination and approve the other proposals described in this proxy statement/prospectus.

OTR Acquisition Sponsor LLC, the sponsor of OTR, has agreed to vote all of its shares of OTR common stock in favor of the Business Combination Agreement and the Business Combination (together, the “Proposed Transactions”) and the other proposals described in this proxy statement/prospectus.

As described in this proxy statement/prospectus, certain stockholders of Comera entered into a written consent (the “Written Consent”) whereby stockholders holding the requisite number of Comera voting securities necessary to approve the Business Combination approved and adopted the Proposed Transactions. Such approval required the affirmative vote of the holders of at least (i) a majority of the outstanding shares of Comera common stock and Comera preferred stock voting together as a single class, on an as-converted basis and (ii) a majority of the outstanding shares of Comera preferred stock, voting as a separate class. No additional approval or vote from any holders of any class or series of stock of Comera will be necessary to adopt and approve the Business Combination Agreement and the Business Combination.

After careful consideration, the respective OTR and Comera boards of directors have unanimously approved the Business Combination Agreement and the Business Combination, and the board of directors of OTR has approved the other proposals described in this proxy statement/prospectus, and each of the OTR and Comera boards of directors has determined that it is advisable to consummate the Business Combination. The board of directors of OTR recommends that its stockholders vote “FOR” the proposals described in this proxy statement/prospectus.

More information about OTR, Comera and the Proposed Transactions is contained in this proxy statement/prospectus. OTR and Comera urge you to read the accompanying proxy statement/prospectus, including the financial statements and annexes and other documents referred to herein, carefully and in their entirety. IN PARTICULAR, YOU SHOULD CAREFULLY CONSIDER THE MATTERS DISCUSSED UNDER “RISK FACTORS” BEGINNING ON PAGE 40 OF THIS PROXY STATEMENT/PROSPECTUS.

This proxy statement/prospectus is dated [●], 2022 and is first being mailed to the stockholders of OTR on or about that date.

NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THIS PROXY STATEMENT/PROSPECTUS OR ANY OF THE SECURITIES TO BE ISSUED IN THE BUSINESS COMBINATION, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.


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OTR ACQUISITION CORP.

1395 Brickell Avenue, Suite 800

Miami, Florida 33131

NOTICE OF SPECIAL MEETING IN LIEU OF 2022 ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON [], 2022

To the Stockholders of OTR Acquisition Corp.:

NOTICE IS HEREBY GIVEN that a special meeting in lieu of the 2022 annual meeting of stockholders (the “special meeting”) of OTR Acquisition Corp., a Delaware corporation (“OTR,” “we,” “our” or “us”), which, in light of public health concerns regarding the coronavirus (COVID-19) pandemic, will be held in virtual format on [●], 2022, at [●], Eastern time. The special meeting can be accessed by visiting [], where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen to the special meeting by dialing [●] (toll-free within the U.S. and Canada) or [●] (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is [●], but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the special meeting by means of remote communication.

You are cordially invited to attend the special meeting, which will be held for the following purposes:

 

  1.

Proposal No. 1 — The Business Combination Proposal — to consider and vote on a proposal to approve and adopt the Business Combination Agreement, dated as of January 31, 2022 (as it may be amended and/or restated from time to time, the “Business Combination Agreement”), by and among OTR, Comera Life Sciences Holdings, Inc. (“Holdco”), Comera Life Sciences, Inc. (“Comera”), CLS Sub Merger 1 Corp. (“Comera Merger Sub”) and CLS Sub Merger 2 Corp. (“OTR Merger Sub”), and the transactions contemplated thereby, pursuant to which (i) Comera Merger Sub will be merged with and into Comera, with Comera surviving the Comera Merger as a direct wholly-owned subsidiary of Holdco and (ii) OTR Merger Sub will be merged with and into OTR, with OTR surviving the OTR Merger as a direct wholly-owned subsidiary of Holdco (collectively with the other transactions described in the Business Combination Agreement, the “Business Combination”);

 

  2.

Proposal No. 2 — The “Charter Amendment Proposal” — to consider and vote on, on a non-binding advisory basis, three separate governance proposals relating to the following material differences between OTR’s current amended and restated certificate of incorporation and the Amended and Restated Certificate of Incorporation of Holdco:

 

  (a)

Advisory Governance Proposal 2A – to increase the number of authorized shares of common stock from 110,000,000 to 150,000,000; (Proposal No. 2A);

 

  (b)

Advisory Governance Proposal 2B – to change the number of classes of directors from two classes to three classes (Proposal No. 2B); and

 

  (c)

Advisory Governance Proposal 2C – to remove the renouncement of corporate opportunity doctrine (Proposal No. 2C).

 

  3.

Proposal No. 3 — The Equity Incentive Award Plan Proposal — to consider and vote on a proposal to approve and adopt the equity incentive award plan established to be effective after the closing of the Business Combination; and

 

  4.

Proposal No. 4 — The “Adjournment Proposal” — to consider and vote on a proposal to adjourn the special meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the special meeting, there are not sufficient votes to approve one or more proposals presented to stockholders for vote.

Your attention is directed to the proxy statement/prospectus accompanying this notice (including the financial statements and annexes attached thereto) for a more complete description of the proposed Business


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Combination and related transactions and each of our proposals. We encourage you to read this proxy statement/prospectus carefully. If you have any questions or need assistance voting your shares, please call our proxy solicitor, [●], at [●]; banks and brokers can call collect at [●].

The Charter Amendment Proposal and Equity Incentive Award Plan Proposal are conditioned on the approval of the Business Combination Proposal. The Adjournment Proposal is not conditioned on, and therefore does not require the approval of, the Business Combination Proposal and Business Combination to be effective.

OTR Acquisition Sponsor LLC, the sponsor of OTR, has agreed to (a) vote all of its shares of OTR common stock in favor of the Business Combination Agreement and Business Combination (together, the “Proposed Transactions”) and the other proposals described in this proxy statement/prospectus; (b) abstain from exercising any redemption rights in connection with the Proposed Transactions and (c) waive the anti-dilution provisions of Section 4.3(b)(ii) of OTR’s amended and restated certificate of incorporation, which contains adjustments to the conversion ratio of the shares of OTR’s Class B common stock into shares of OTR’s Class A common stock on the closing of the Business Combination.

All OTR stockholders are cordially invited to attend the special meeting in virtual format. OTR stockholders may attend, vote and examine the list of OTR stockholders entitled to vote at the special meeting by visiting [●] and entering the control number found on their proxy card, voting instruction form or notice included in their proxy materials. In light of public health concerns regarding the COVID-19 pandemic, the special meeting will be held in virtual meeting format only. You will not be able to attend the special meeting physically. To ensure your representation at the special meeting, you are urged to complete, sign, date and return the enclosed proxy card as soon as possible. If your shares are held in an account at a brokerage firm or bank, you must instruct your broker or bank on how to vote your shares.

Your vote is important regardless of the number of shares you own. Whether you plan to attend the special meeting or not, please sign, date and return the enclosed proxy card as soon as possible in the envelope provided. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted.

Thank you for your participation. We look forward to your continued support.

 

[●], 2022   

By Order of the Board of Directors,

Nicholas J. Singer

Chairman and Chief Executive Officer

If you return your signed proxy without an indication of how you wish to vote, your shares will be voted in favor of each of the proposals.

All holders (the “Public Stockholders”) of shares of OTR common stock issued in OTR’s initial public offering (the “Public Shares”) have the right to redeem their Public Shares for cash in connection with the proposed Business Combination. Public Stockholders are not required to affirmatively vote for or against the Business Combination Proposal, to vote on the Business Combination Proposal at all, or to be holders of record on the record date in order to have their shares redeemed for cash. This means that any Public Stockholder holding Public Shares may exercise redemption rights regardless of whether they are even entitled to vote on the Business Combination Proposal.

To exercise redemption rights, holders must tender their stock to Continental Stock Transfer & Trust Company, OTR’s transfer agent, no later than two (2) business days prior to the special meeting. You may tender your stock by either delivering your stock certificate to the transfer agent or by delivering your shares electronically using the Depository Trust Company’s Deposit Withdrawal at Custodian System. If the Business Combination is not completed, then these shares will not be redeemed for cash. If you hold the shares in street name, you will need to instruct your bank or broker to withdraw the shares from your account in order to exercise your redemption rights.


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     Page  

ABOUT THIS PROXY STATEMENT/PROSPECTUS

     1  

MARKET AND INDUSTRY DATA

     1  

FREQUENTLY USED TERMS

     2  

QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION

     8  

SUMMARY OF THE PROXY STATEMENT/PROSPECTUS

     23  

SELECTED HISTORICAL FINANCIAL INFORMATION OF COMERA

     35  

SELECTED HISTORICAL FINANCIAL INFORMATION OF OTR

     36  

SELECTED UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

     37  

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

     38  

RISK FACTORS

     40  

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

     107  

COMPARATIVE SHARE INFORMATION

     109  

THE SPECIAL MEETING OF OTR STOCKHOLDERS

     110  

PROPOSALS TO BE CONSIDERED BY OTR’S STOCKHOLDERS

     115  

PROPOSAL NO. 1 — THE BUSINESS COMBINATION PROPOSAL

     115  

THE BUSINESS COMBINATION

     115  

THE BUSINESS COMBINATION AGREEMENT

     130  

CERTAIN AGREEMENTS RELATED TO THE BUSINESS COMBINATION

     145  

MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

     147  

PROPOSAL NO. 2 — THE CHARTER AMENDMENT PROPOSAL

     155  

PROPOSAL NO. 3 — THE EQUITY INCENTIVE AWARD PLAN PROPOSAL

     158  

PROPOSAL NO. 4 — THE ADJOURNMENT PROPOSAL

     163  

INFORMATION ABOUT COMERA

     164  

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT OF COMERA

     185  

EXECUTIVE OFFICERS, DIRECTORS AND ADVISORY BOARD OF COMERA

     188  

EXECUTIVE OFFICER AND DIRECTOR COMPENSATION OF COMERA

     193  

COMERA MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     197  

CERTAIN COMERA RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

     207  

INFORMATION ABOUT OTR

     213  

OTR MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     226  

CERTAIN OTR RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

     233  

MANAGEMENT OF HOLDCO FOLLOWING THE BUSINESS COMBINATION

     236  

DESCRIPTION OF HOLDCO’S SECURITIES

     240  

COMPARISON OF STOCKHOLDER RIGHTS

     244  

SHARES ELIGIBLE FOR FUTURE SALE

     260  

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT OF OTR AND HOLDCO

     262  

MARKET PRICE AND DIVIDEND INFORMATION

     265  

ADDITIONAL INFORMATION

     266  

WHERE YOU CAN FIND MORE INFORMATION

     267  

INDEX TO FINANCIAL STATEMENTS

     F-1  

PART II INFORMATION NOT REQUIRED IN PROSPECTUS

     II-1  

 

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ANNEXES

  

Annex A: Business Combination Agreement

     A-1  

Annex B: Form of Amended and Restated Certificate of Incorporation of Holdco

     B-1  

Annex C: Form of Amended and Restated Bylaws of Holdco

     C-1  

Annex D: Form of Assignment, Assumption and Amendment to OTR Warrant Agreement

     D-1  

Annex E: Comera Life Sciences, Inc. 2022 Incentive Plan Award

     E-1  

Annex F: Stockholder Support Agreement

     F-1  

Annex G: Sponsor Support Agreement

     G-1  

Annex H: Form of Registration Rights and Lock-Up Agreement

     H-1  

Annex I: Form of Letter Agreement

     I-1  

 

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ABOUT THIS PROXY STATEMENT/PROSPECTUS

This document, which forms part of a registration statement on Form S-4 filed with the SEC, by Holdco (File No. 333-          ) (the “Registration Statement”), constitutes a prospectus of Holdco under Section 5 of the Securities Act, with respect to the shares of Holdco Common Stock and Holdco Warrants to be issued if the Business Combination described below is consummated. This document also constitutes a notice of meeting and a proxy statement under Section 14(a) of the Exchange Act with respect to the special meeting in lieu of the 2022 annual meeting of OTR stockholders at which OTR stockholders will be asked to consider and vote on a proposal to approve the Business Combination by the approval and adoption of the Business Combination Agreement, among other matters.

This document does not constitute an offer to sell or the solicitation of an offer to buy securities in any jurisdiction or to any person to whom it would be unlawful to make such offer.

This document includes trademarks, tradenames and service marks, certain of which belong to Comera and others that are the property of other organizations. Solely for convenience, trademarks, tradenames and service marks referred to in this document appear without the ®, TM and SM symbols, but the absence of those symbols is not intended to indicate, in any way, that Holdco or Comera will not assert their rights or that the applicable owner will not assert its rights to these trademarks, tradenames and service marks to the fullest extent under applicable law. Holdco does not intend its use or display of other parties’ trademarks, trade names or service marks to imply, and such use or display should not be construed to imply, a relationship with, or endorsement or sponsorship of Holdco by, these other parties.

Unless otherwise specified, in this proxy statement/prospectus, all ownership amounts and percentages with respect to Holdco following the Business Combination assume (i) all Comera vested, in-the-money options are exercised prior to Closing, (ii) no exercise of warrants of OTR, (iii) no stockholders of OTR exercise redemption rights in connection with their shares of OTR common stock and (iv) all Earn-Out Shares are earned by the Comera stockholders.

MARKET AND INDUSTRY DATA

This document contains estimates, projections, and other information concerning Comera’s industry and business, as well as data regarding market research, estimates, and forecasts prepared by Comera’s management. Information that is based on estimates, forecasts, projections, market research, or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. The industry in which Comera operates is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section titled “Risk Factors.” Unless otherwise expressly stated, Comera obtained this industry, business, market, and other data from reports, research surveys, studies, and similar data prepared by market research firms and other third parties, industry and general publications, government data, and similar sources. In some cases, Comera does not expressly refer to the sources from which this data is derived. In that regard, when Comera refers to one or more sources of this type of data in any paragraph, you should assume that other data of this type appearing in the same paragraph is derived from sources which Comera paid for, sponsored, or conducted, unless otherwise expressly stated or the context otherwise requires. While Comera has compiled, extracted, and reproduced industry data from these sources, Comera has not independently verified the data. Forecasts and other forward-looking information with respect to industry, business, market, and other data are subject to the same qualifications and additional uncertainties regarding the other forward-looking statements in this document. See “Cautionary Note Regarding Forward-Looking Statements.”

 

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FREQUENTLY USED TERMS

In this document:

“Aggregate Transaction Consideration” means (i) a number of shares of Holdco Common Stock equal to the quotient of (a) $126 million less any Leakage since September 30, 2021 divided by (b) $10.00 and (ii) a number of shares of Holdco Common Stock equal to the number of shares of OTR Common Stock issued and outstanding immediately prior to the OTR Merger Effective Time, payable to the OTR Stockholders in connection with the OTR Merger.

“broker non-vote” means shares held in “street name” through a broker or other nominee, for which the beneficial owner has failed to instruct the broker or nominee as to how such shares should be voted and for which the broker or nominee does not have discretionary authority to vote such shares absent such voting instruction.

“Business Combination” means the transactions contemplated by the Business Combination Agreement.

“Business Combination Agreement” means the Business Combination Agreement, dated as of January 31, 2022, as it may be amended and/or restated from time to time, by and among OTR, Holdco, Comera Merger Sub, OTR Merger Sub and Comera.

“Change of Control” means (a) a sale, lease, license or other disposition, in a single transaction or a series of related transactions, of fifty percent (50%) or more of the assets of Holdco and its subsidiaries, taken as a whole; (b) a merger, consolidation or other business combination of Holdco resulting in any person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the Closing Date) acquiring at least fifty percent (50%) of the combined voting power of the then outstanding securities of Holdco or the surviving Person outstanding immediately after such combination (for the avoidance of doubt, excluding any Earn-out Shares that may be issued in connection with such transaction(s)); or (c) any person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the Closing Date) obtaining beneficial ownership (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of the voting shares of Holdco representing more than fifty percent (50%) of the voting power of the share capital of Holdco entitled to vote for the election of directors of Holdco.

“Closing” means the consummation of the Business Combination.

“Closing Date” means the date on which the Closing occurs.

“Code” means the Internal Revenue Code of 1986, as amended.

“Comera” means Comera Life Sciences, Inc., a Delaware corporation.

“Comera Board of Directors” means the board of directors of Comera.

“Comera Capital Stock” means Comera Common Stock and Comera Preferred Stock.

“Comera Common Stock” means common stock of Comera, par value $0.001 per share.

“Comera Merger” means the merger pursuant to the terms of the Business Combination Agreement whereby Comera Merger Sub will merge with and into Comera, with Comera surviving such merger as a direct wholly-owned subsidiary of Holdco.

“Comera Merger Sub” means CLS Sub Merger 1 Corp., a Delaware corporation.

 

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“Comera Merger Sub Requisite Approval” means the resolutions of the sole stockholder of Comera Merger Sub approving and adopting the transactions contemplated by the Business Combination Agreement and any other proposals deemed necessary to effect such transactions.

“Comera Merger Surviving Corporation” means Comera as the surviving corporation of the Comera Merger.

“Comera Options” means all outstanding options to purchase shares of Comera Common Stock, whether or not exercisable and whether or not vested, immediately prior to the Closing under the Comera option plan or otherwise.

“Comera Preferred Stock” means the shares of Comera’s preferred stock, including the Comera Series A-1 Preferred Stock, Comera Series A-2 Preferred Stock, Comera Series A-3 Preferred Stock, Comera Series A-4 Preferred Stock, Comera Series A-5 Preferred Stock, Comera Series A-6 Preferred Stock, Comera Series B-1 Preferred Stock and Comera Series B-2 Preferred Stock

“Comera Series A-1 Preferred Stock” means preferred stock of Comera, par value $0.001 per share, designated as Series A-1 Preferred Stock.

“Comera Series A-2 Preferred Stock” means preferred stock of Comera, par value $0.001 per share, designated as Series A-2 Preferred Stock.

“Comera Series A-3 Preferred Stock” means preferred stock of Comera, par value $0.001 per share, designated as Series A-3 Preferred Stock.

“Comera Series A-4 Preferred Stock” means preferred stock of Comera, par value $0.001 per share, designated as Series A-4 Preferred Stock.

“Comera Series A-5 Preferred Stock” means preferred stock of Comera, par value $0.001 per share, designated as Series A-5 Preferred Stock.

“Comera Series A-6 Preferred Stock” means preferred stock of Comera, par value $0.001 per share, designated as Series A-6 Preferred Stock.

“Comera Series B-1 Preferred Stock” means preferred stock of Comera, par value $0.001 per share, designated as Series B-1 Preferred Stock.

“Comera Series B-2 Preferred Stock” means preferred stock of Comera, par value $0.001 per share, designated as Series B-2 Preferred Stock.

“Comera Merger Effective Time” means the time at which the Comera Merger will become effective by the filing of a certificate of merger with the Secretary of State of the State of Delaware and will be effective immediately upon such filing or upon such later time as may be agreed by the parties and specified in such certificate of merger.

“Comera Stockholders” means the holders of Comera Capital Stock.

“Comera Unvested Option” means a Comera Option that has not vested immediately prior to the Comera Merger Effective Time.

“Comera Vested In-the-Money Option” means a Comera Option that has vested prior to the Comera Merger Effective Time and has an exercise price per share of Comera Common Stock subject thereto that is less than the value of the Aggregate Transaction Consideration being paid per share of Comera Common Stock.

 

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“Comera Vested Out-of-the-Money Option” means a Comera Option that has vested prior to the Comera Merger Effective Time and has an exercise price per share of Comera Common Stock subject thereto that is equal to or greater than the value of the Aggregate Transaction Consideration being paid per share of Comera Common Stock.

“Combined Company” means Holdco and its consolidated subsidiaries after giving effect to the Business Combination.

“Consenting Comera Stockholders” means James Sherblom, Phoenix Venture Partners, LP and The Soane Family Trust, the parties who signed the Written Consent.

“DGCL” means the Delaware General Corporation Law.

“Earn-Out Period” means the period beginning on the Closing Date and expiring at the close of business on the second anniversary of the Closing Date.

“Earn-Out Shares” means the 3,150,000 shares of Holdco Common Stock that Holdco shall place into escrow with the Escrow Agent pursuant to the Escrow Agreement.

“Earn-Out Trigger” means when the VWAP of Holdco Common Stock shall be equal to or greater than $12.50 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days during the Earn-Out Period.

“Escrow Agent” means a mutually satisfactory escrow agent under the Escrow Agreement, it being agreed that Continental Stock Transfer and Trust Company is satisfactory to all parties to the Business Combination Agreement.

“Escrow Agreement” means an escrow agreement, in form and substance to be mutually agreed upon by the parties to the Business Combination Agreement, to be entered into by OTR, Holdco, Comera and the Escrow Agent, pursuant to which the Earn-Out Shares will be placed into escrow and distributed in accordance with the provisions of the Business Combination Agreement and such Escrow Agreement.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Founder Shares” means the shares of OTR Class B Common Stock initially purchased by the Sponsor in a private placement in August 2020, and the shares of OTR Class A Common Stock issuable upon the conversion thereof.

“GAAP” means United States generally accepted accounting principles.

“Holdco” means Comera Life Sciences Holdings, Inc., a Delaware corporation.

“Holdco Board” means the board of directors of Holdco.

“Holdco Bylaws” means the Amended and Restated Bylaws of Holdco attached as Annex C.

“Holdco Charter” means the Amended and Restated Certificate of Incorporation of Holdco attached as Annex B.

“Holdco Common Stock” means Holdco’s common stock, par value $0.0001 per share.

 

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“Holdco Requisite Approval” means the resolutions of the sole stockholder of Holdco approving and adopting the transactions contemplated by the Business Combination Agreement and any other proposals deemed necessary to effect such transactions.

“Holdco Warrants” means the OTR Warrants, as amended at the Closing such that each OTR Warrant becomes a right to acquire one share of Holdco Common Stock on substantially the same terms as were in effect immediately prior to the Closing under the terms of the OTR Warrant Agreement (assumed by Holdco at Closing).

“Investment Company Act” means the Investment Company Act of 1940, as amended.

“IPO” means OTR’s initial public offering of units, consummated on November 19, 2020.

“JOBS Act” means the Jumpstart Our Business Startups Act of 2012, as amended.

“Key Comera Stockholders” means the persons listed on Schedule B to the Business Combination Agreement.

“Leakage” means (a) any dividend or distribution (whether in cash or in kind) declared, paid, made, agreed or obligated to be made by Comera to or for the benefit of the Comera Stockholders or any affiliate of the Comera Stockholders, (b) any management, service or other charges or fees (including out of ordinary course directors’ fees and any monitoring fees) paid by Comera to, on behalf of, or for the benefit of any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera, (c) any return of capital (whether by reduction of capital or redemption or purchase of shares or otherwise) by Comera or any amount payable on the repurchase, repayment, redemption, reduction or cancellation of any share capital, loan capital or other securities of Comera, in each case, to or for the benefit of any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera, (d) any waiver, deferral or release by Comera of any amount or obligation owed or due to Comera from any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera, (e) any payment of any costs, bonuses or other sums by Comera (excluding salary, bonuses or other benefits paid to any such person in his or her capacity as an officer or employee of Comera in the ordinary course of business and consistent with past practice), on behalf of or for the benefit of any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera, (f) any assumption or discharge by Comera of any liability (including in relation to any recharging of costs of any kind) on behalf of or for the benefit of any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera, (g) any guarantee, indemnity or security provided by Comera in respect of the obligations or liabilities of any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera (that is not released effective as of Closing), (h) any transfer or disposal of any asset to any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera, for consideration which is less than market value, (i) any acquisition of any asset from any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera for consideration which is more than market value, (j) any payment by Comera of any taxes imposed on any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera (other than any taxes for which Comera is primarily liable), or any agreement or obligation of any of Comera to make such payment, or (k) any payment by Comera of any personal expenses of any stockholder(s) of Comera or any affiliate of any stockholder(s) of Comera, other than reimbursement of reasonable and documented out-of-pocket expenses incurred in any such person’s capacity as a director or officer of Comera in the ordinary course of business and consistent with past practice.

“Letter Agreement” means the Letter Agreement to be entered into in connection with the Closing by Holdco and Sponsor.

“Merger Subs” means Comera Merger Sub and OTR Merger Sub.

“Mergers” means the Comera Merger and OTR Merger.

 

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“Nasdaq” means the Nasdaq Stock Market LLC.

“OTR” means OTR Acquisition Corp., a Delaware corporation.

“OTR Class A Common Stock” means OTR’s Class A common stock, par value $0.0001.

“OTR Class B Common Stock” means OTR’s Class B common stock, par value $0.0001.

“OTR Common Stock” means the OTR Class A Common Stock and OTR Class B Common Stock, collectively.

“OTR Merger” means the merger pursuant to the terms of the Business Combination Agreement whereby OTR Merger Sub will merge with and into OTR, with OTR surviving such merger as a direct wholly-owned subsidiary of Holdco.

“OTR Merger Sub” means CLS Sub Merger 2 Corp., a Delaware corporation.

“OTR Merger Sub Requisite Approval” means the resolutions of the sole stockholder of OTR Merger Sub approving and adopting the transactions contemplated by the Business Combination Agreement and any other proposals deemed necessary to effect such transactions.

“OTR Merger Surviving Corporation” means OTR as the surviving corporation of the OTR Merger.

“OTR Unit” means one share of OTR Common Stock and one-half OTR Warrant.

“OTR Warrant Agreement” means the warrant agreement, dated as of November 17, 2020, by and between OTR and Continental Stock Transfer & Trust Company, governing OTR’s outstanding warrants.

“OTR Warrants” means warrants to purchase shares of OTR Class A Common Stock as contemplated under the OTR Warrant Agreement, with each whole warrant exercisable for one share of OTR Class A Common Stock at an exercise price of $11.50 per whole share.

“PCAOB” means the Public Company Accounting Oversight Board.

“PCAOB Audited Financials” means the audited balance sheets of Comera as of December 31, 2021 and 2020, and the related audited statements of operations and comprehensive loss, convertible preferred stock, members’ equity and stockholders’ deficit, and cash flows of Comera for the year then ended, each audited in accordance with the auditing standards of the PCAOB and auditing standards generally accepted in the United States of America and included elsewhere in this proxy statement/prospectus.

“Private Warrants” means the warrants to purchase shares of OTR Class A Common Stock issued to Sponsor simultaneously with the closing of the IPO.

“prospectus” means this prospectus in which forms a part of the Registration Statement on Form S-4 (Registration No. 333-          ) filed with the SEC, which is also a proxy statement to solicit proxies from OTR Stockholders.

“Public Shares” means shares of OTR Class A Common Stock issued as part of the units sold in the IPO.

“Public Stockholders” means the holders of shares of OTR Class A Common Stock.

“Public Warrants” means the warrants included in the units sold in the IPO, each of which is exercisable for one share of OTR Class A Common Stock, in accordance with its terms.

 

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“Registration Rights and Lock-Up Agreement” means the Registration Rights and Lock-Up Agreement to be entered into in connection with the Closing by OTR, Holdco, certain stockholders of Comera and Sponsor.

“Sarbanes-Oxley Act” means the Sarbanes-Oxley Act of 2002.

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended.

“special meeting” means the special meeting in lieu of the 2022 annual meeting of the stockholders of OTR that is the subject of this proxy statement/prospectus.

“Sponsor” means OTR Acquisition Sponsor LLC, a Delaware limited liability company.

“Sponsor Support Agreement” means the Sponsor Support Agreement, dated as of January 31, 2022, by and among OTR, Sponsor, Holdco and Comera.

“Stockholder Support Agreement” means the Stockholder Support Agreement, dated as of January 31, 2022, by and among OTR, Holdco, Comera and the Key Comera Stockholders.

“Trading Day” means any day on which shares of Holdco Common Stock are actually traded on the Trading Market.

“Trading Market” means Nasdaq or such other stock market on which the Holdco Common Stock shall be trading at the time of determination of VWAP.

“Trust Account” means the trust account that holds a portion of the proceeds of the IPO and the concurrent sale of the Private Warrants.

“VWAP” means, for each Trading Day, the daily volume-weighted average price for shares of Holdco Common Stock on the Trading Market during the period beginning at 9:30:01 a.m., New York time on such Trading Day and ending at 4:00:00 p.m., New York time on such Trading Day, as reported by Bloomberg through its “HP” function (set to weighted average).

“Written Consent” means the irrevocable written consent containing the Consenting Comera Stockholders approval of the Business Combination Agreement and Business Combination, dated as of January 31, 2022.

 

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QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION

The following questions and answers briefly address some commonly asked questions about the proposals to be presented at the special meeting of OTR stockholders, including with respect to the proposed Business Combination. The following questions and answers may not include all the information that is important to OTR stockholders. Stockholders are urged to carefully read this entire proxy statement/prospectus, including the financial statements and annexes attached hereto and the other documents referred to herein.

Questions and Answers About the Special Meeting of OTR’s Stockholders and the Related Proposals

 

Q.

Why am I receiving this proxy statement/prospectus?

 

A.

OTR has entered into the Business Combination Agreement with Holdco, Comera, Comera Merger Sub and OTR Merger Sub, pursuant to which (i) Comera Merger Sub will be merged with and into Comera, with Comera surviving the Comera Merger as a direct wholly-owned subsidiary of Holdco and (ii) OTR Merger Sub will be merged with and into OTR, with OTR surviving the OTR Merger as a direct wholly-owned subsidiary of Holdco. A copy of the Business Combination Agreement is attached to this proxy statement/prospectus as Annex A.

Upon the Closing of the Business Combination, all shares of Comera Common Stock issued and outstanding immediately prior to the Closing (including shares of Comera Common Stock issued upon conversion of Comera Preferred Stock immediately prior to the Closing) will be canceled and converted into the right to receive shares of Holdco Common Stock, all Comera Vested In-the-Money Options outstanding will be canceled and converted into the right to receive shares of Holdco Common Stock and all outstanding Comera Unvested Options and Comera Vested Out-of-the-Money Options will be converted into options to purchase shares of Holdco Common Stock. In addition, upon the Closing of the Business Combination, all shares of OTR Common Stock issued and outstanding immediately prior to the Closing will be converted into the right to receive shares of Holdco Common Stock and all OTR Warrants outstanding will be converted into warrants to purchase shares of Holdco Common Stock. See “Summary of the Proxy Statement/Prospectus — Ownership of Holdco After the Closing” for further information.

OTR stockholders are being asked to consider and vote on the Business Combination Proposal to approve the adoption of the Business Combination Agreement and approve the Business Combination, among other proposals.

The OTR Common Stock, OTR Warrants and OTR Units are currently listed on the Nasdaq under the symbols “OTRA,” “OTRAW” and “OTRAU,” respectively. Holdco intends to apply to list the Holdco Common Stock and Holdco Warrants on the Nasdaq under the symbols “CMRA” and “CMRAW,” respectively, upon the Closing.

This proxy statement/prospectus and its annexes contain important information about the proposed Business Combination and the proposals to be acted upon at the special meeting. You should read this proxy statement/prospectus and its annexes carefully and in their entirety. This document also constitutes a prospectus of OTR with respect to the Holdco Common Stock issuable in connection with the Business Combination.

 

Q.

What matters will stockholders consider at the special meeting?

 

A.

At the OTR special meeting of stockholders, OTR will ask its stockholders to vote in favor of the following proposals (the “OTR Proposals”):

 

   

The Business Combination Proposal — a proposal to approve and adopt the Business Combination Agreement and the Business Combination (Proposal No. 1).

 

   

The Charter Amendment Proposal — a proposal to consider and vote on, on a non-binding advisory basis, three separate governance proposals relating to the material differences between OTR’s current amended and restated certificate of incorporation and the Amended and Restated Certificate of Incorporation of Holdco (Proposals No. 2A – 2C).

 

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The Equity Incentive Award Plan Proposal — a proposal to approve and adopt the equity incentive award plan established to be effective after the Closing of the Business Combination (Proposal No. 3).

 

   

The Adjournment Proposal — a proposal to adjourn the special meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the special meeting, there are not sufficient votes to approve one or more proposals presented to stockholders for vote (Proposal No. 4).

 

Q.

Are any of the proposals conditioned on one another?

 

A.

The Charter Amendment Proposal and Equity Incentive Award Plan Proposal are conditioned on the approval of the Business Combination Proposal. The Adjournment Proposal is not conditioned on, and therefore does not require the approval of, the Business Combination Proposal and Business Combination to be effective. It is important for you to note that in the event if the Business Combination Proposal is not approved, then OTR will not consummate the Business Combination. If OTR does not consummate the Business Combination and fails to complete an initial business combination by May 19, 2022 or obtain the approval of OTR stockholders to extend the deadline for OTR to consummate an initial business combination, then OTR will be required to dissolve and liquidate.

 

Q.

What will happen upon the consummation of the Business Combination?

 

A.

On the Closing Date, (i) Comera Merger Sub will be merged with and into Comera, with Comera surviving the Comera Merger as a direct wholly-owned subsidiary of Holdco and (ii) OTR Merger Sub will be merged with and into OTR, with OTR surviving the OTR Merger as a direct wholly-owned subsidiary of Holdco. The Mergers will have the effects specified under Delaware law. The aggregate transaction consideration to be paid to Comera in the Business Combination will be a number of shares of Holdco Common Stock equal to $126 million divided by $10.00. The aggregate transaction consideration will be allocated among the holders of shares of Comera Common Stock (including Comera Common Stock issued upon the conversion of Comera Preferred Stock) and holders of Comera Options. In addition, on the Closing Date, all shares of OTR Common Stock issued and outstanding immediately prior to the Closing will be converted into the right to receive shares of Holdco Common Stock and all OTR Warrants outstanding will be converted into warrants to purchase shares of Holdco Common Stock.

 

Q.

Why is OTR proposing the Business Combination Proposal?

 

A.

OTR was organized for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. OTR is not limited to any particular industry or sector.

OTR received $107,085,338 from its IPO (including net proceeds from the partial exercise by the underwriters of their over-allotment option) and sale of the Private Warrants, which was placed into the Trust Account immediately following the IPO. In accordance with OTR’s amended and restated certificate of incorporation, the funds held in the Trust Account will be released upon the consummation of the Business Combination. See the question entitled “What happens to the funds held in the Trust Account upon consummation of the Business Combination?

There currently are 13,242,017 shares of OTR Common Stock issued and outstanding, consisting of 10,630,179 Public Shares and 2,611,838 Founder Shares. In addition, there currently are 11,041,432 OTR Warrants issued and outstanding, consisting of 5,223,675 Public Warrants and 5,817,757 Private Warrants. Each whole OTR Warrant entitles the holder thereof to purchase one share of OTR Common Stock at a price of $11.50 per share. The OTR Warrants are currently exercisable and expire at 5:00 p.m., New York City time, five years after the completion of a business combination or earlier upon redemption or liquidation. The Private Warrants, however, are non-redeemable so long as they are held by their initial purchasers or their permitted transferees.

 

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Q.

How does Comera’s Amended and Restated Certificate of Incorporation materially differ from the Amended and Restated Certificate of Incorporation of Holdco (the “Holdco Charter”) to be adopted in connection with the Business Combination?

 

A.

Comera’s Amended and Restated Certificate of Incorporation is suitable for a private, unlisted company with a small number of investors, stockholders and stakeholders. The Holdco Charter is intended to provide sufficient flexibility for Holdco to operate as public company listed on Nasdaq and to conduct the Mergers and any financings that may be needed in connection with the Mergers or the execution of Comera’s business plan. Compared to Comera’s Amended and Restated Certificate of Incorporation, the Holdco Charter will:

 

   

increase the number of authorized shares of common stock from 20 million to 150 million;

 

   

reduce the number of authorized shares of preferred stock from 14,051,702, to 1 million;

 

   

create a classified board;

 

   

remove certain protective provisions and special rights in favor of holders of each series of Comera preferred stock; and

 

   

add provisions to facilitate the conduct of large stockholder meetings.

See “Comparison of Stockholder Rights.”

 

Q.

How does OTR’s Amended and Restated Certificate of Incorporation materially differ from the Holdco Charter to be adopted in connection with the Business Combination?

 

A.

OTR’s amended and restated certificate of incorporation is suitable for a special purpose acquisition company. The Holdco Charter does not include the provisions applicable to special purpose acquisition companies and the material differences from OTR’s amended and restated certificate of incorporation are:

 

   

to increase the number of authorized shares of Holdco Common Stock to 150 million;

 

   

to change the number of classes of directors from two classes to three classes; and

 

   

to remove the provision renouncing the corporate opportunity doctrine;

For more information about these amendments to Holdco’s certificate of incorporation, see the sections entitled “Proposal No. 2 — The Charter Amendment Proposal.

 

Q.

Who is Comera?

 

A.

Comera is a biotechnology company dedicated to promoting a compassionate new era in medicine by applying a deep knowledge of formulation science and technology to transform essential biologic medicines from intravenous to subcutaneous forms. This transformation in administration provides patients and families the freedom of self-injectable care. Without the need to receive intravenous treatment at a medical facility, patients can more fully realize the potential of biologic treatments and to enjoy the potential of their own lives. See “Information About Comera.”

 

Q.

What equity stake will current OTR stockholders and Comera Stockholders have in the Combined Company after the Closing?

 

A.

It is anticipated that, upon the completion of the Business Combination, Holdco will become a new public company, and the former holders of securities of OTR and Comera, and the Sponsor shall all become security holders of Holdco.

The following table sets forth the anticipated ownership of Holdco upon completion of the Business Combination assuming no redemptions, 50% redemptions and 100% redemptions. The ownership percentages reflected in the table are based upon the number of shares of Comera Common Stock and shares of OTR Common Stock issued and outstanding as of January 31, 2022 (and assumes a [●], 2022 Closing Date), and are subject to the following additional assumptions:

 

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all Comera Vested In-the-Money Options are exercised prior to Closing;

 

   

no exercise of OTR Warrants; and

 

   

no issuance of additional securities by Holdco prior to Closing.

For purposes of the table:

No Redemptions: This scenario assumes that no Public Stockholders exercise redemption rights with respect to their OTR Class A Common Stock upon consummation of the Business Combination.

50% Redemptions: This scenario assumes that Public Stockholders holding approximately 5,223,675 shares of OTR Class A Common Stock will exercise their redemption rights upon consummation of the Business Combination.

100% Redemptions: This scenario assumes that Public Stockholders holding approximately 10,447,350 shares of OTR Class A Common Stock will exercise their redemption rights upon consummation of the Business Combination.

No Earn-Out: This scenario assumes the Earn-Out Trigger is not achieved during the Earn-Out Period and the Earn-Out Shares are returned to Holdco for cancellation.

Max Earn-Out: This scenario assumes the Earn-Out Trigger is achieved during the Earn-Out Period and the Earn-Out Shares are all released from escrow.

If any of these assumptions are not correct, these percentages will be different.

 

    No Redemptions(1)     50% Redemptions(1)     100% Redemptions(1)  
    No Earn-
Out
    Max Earn-
Out
    No Earn-
Out
    Max Earn-
Out
    No Earn-
Out
    Max Earn-
Out
 

Shares:

           

OTR Public Stockholders(2)

    10,630,179       10,630,179       5,406,504       5,406,504       182,829       182,829  

Sponsor

    2,611,838       2,611,838       2,611,838       2,611,838       2,611,838       2,611,838  

Comera Stockholders

    12,600,000       15,750,000       12,600,000       15,750,000       12,600,000       15,750,000  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
    25,842,017       28,992,017       20,618,342       23,768,342       15,394,667       18,544,667  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ownership Percentage:

           

OTR Public Stockholders(2)

    41.1     36.7     26.2     22.7     1.2     1.0

Sponsor

    10.1     9.0     12.7     11.0     17.0     14.1

Comera Stockholders

    48.8     54.3     61.1     66.3     81.8     84.9

 

(1)

Excludes the impact of OTR Warrants and the Equity Incentive Plan.

(2)

182,829 representative shares from the IPO are not subject to redemption.

 

Q.

Who will be the officers and directors of Holdco if the Business Combination is consummated?

 

A.

Immediately following the consummation of the Business Combination, we expect that the following will be the officers and directors of Holdco:

 

Name

  

Position(s)

Executive Officers:   
Jeffrey S. Hackman    Chairman, President and Chief Executive Officer
Neal Muni, MD    Executive Vice President and Chief Operating Officer
Dr. Robert Mahoney    Chief Scientific Officer
Kevin P. Kavanaugh, CPA    Vice President, Secretary and Chief Financial Officer

 

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Name

  

Position(s)

Class I Directors:   
Rev. Dr. Jim Sherblom    Director
Stuart Randle    Director
Barbara Finck, MD    Director
Class II Directors:   
Edward Sullivan, CPA    Director
Jeffrey S. Hackman    Chairman, President and Chief Executive Officer
John Yee, MD, MPH    Director
Class III Directors:   
Roopom Banerjee, MPP    Director
Kirsten Flowers    Director
William A. Wexler    Director

See “Management of Holdco Following the Business Combination.”

 

Q.

What conditions must be satisfied to complete the Business Combination?

 

A.

There are a number of closing conditions in the Business Combination Agreement, including that OTR’s stockholders have approved and adopted the Business Combination Agreement. For a summary of the conditions that must be satisfied or waived prior to completion of the Business Combination, see the section entitled “The Business Combination Agreement — Conditions to Closing.”

 

Q.

What happens if I sell my shares of OTR Common Stock before the special meeting of stockholders?

 

A.

The record date for the special meeting of stockholders will be earlier than the date that the Business Combination is expected to be completed. If you transfer your shares of OTR Common Stock after the record date, but before the special meeting of stockholders, unless the transferee obtains from you a proxy to vote those shares, you will retain your right to vote at the special meeting of stockholders.

 

Q.

What vote is required to approve the proposals presented at the special meeting of stockholders?

 

A.

The approval of the Business Combination Proposal requires the affirmative vote of the holders of a majority of the then outstanding shares of OTR Common Stock and the Charter Amendment Proposal, Equity Incentive Award Plan Proposal and Adjournment Proposal requires the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders of a majority of the then outstanding shares of OTR Common Stock present and entitled to vote at the special meeting and voted in connection with the applicable proposal. Accordingly, an OTR stockholder’s failure to vote by proxy or to vote in person at the special meeting of stockholders or a broker non-vote or abstention will (i) have the same effect as a vote “against” the Business Combination Proposal and (ii) have no effect on the Charter Amendment Proposal, Equity Incentive Award Plan Proposal or the Adjournment Proposal.

 

Q.

How do OTR’s initial stockholders intend to vote on the proposals?

 

A.

The Sponsor is entitled to vote an aggregate of 19.7% of the outstanding shares of OTR Common Stock. The Sponsor and OTR’s directors and officers have agreed to vote any Founder Shares and any Public Shares held by them as of the record date in favor of each of the proposals presented at the special meeting.

 

Q.

Do Comera’s Stockholders need to approve the Business Combination?

 

A.

Yes. Contemporaneously with the execution of the Business Combination Agreement, the Consenting Comera Stockholders entered into a written consent, pursuant to which the Consenting Comera Stockholders approved the Business Combination Agreement and Mergers. Collectively, as of December 31, 2021, the Consenting Comera Stockholders held approximately 55.9% of the outstanding shares of Comera Capital Stock. The Consenting Comera Stockholders therefore hold a sufficient number of shares of Comera Capital Stock to approve the Business Combination without the vote of any other Comera stockholder.

 

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Q.

May OTR or OTR’s directors, officers or advisors, or their affiliates, purchase shares in connection with the Business Combination?

 

A.

In connection with the stockholder vote to approve the proposed Business Combination, the Sponsor and OTR’s board of directors, officers, advisors or their affiliates may privately negotiate transactions to purchase shares prior to the Closing from stockholders who would have otherwise elected to have their shares redeemed for cash in conjunction with a proxy solicitation pursuant to the proxy rules for a per share pro rata portion of the Trust Account without the prior written consent of Comera. None of the Sponsor, directors, officers or advisors, or their respective affiliates, will make any such purchases when they are in possession of any material non-public information not disclosed to the seller of such shares. Such a purchase would include a contractual acknowledgement that such stockholder, although still the record holder of such shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that the Sponsor, directors, officers or advisors, or their affiliates, purchase shares in privately negotiated transactions from Public Stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares for cash. Any such privately negotiated purchases may be effected at purchase prices that are in excess of the per share pro rata portion of the Trust Account. The purpose of these purchases would be to increase the amount of cash available to OTR for use in the Business Combination.

 

Q.

How many votes do I have at the special meeting of stockholders?

 

A.

OTR’s stockholders are entitled to one vote at the special meeting for each share of OTR Common Stock held of record as of the record date. As of the close of business on the record date, there were [●] outstanding shares of OTR Common Stock.

 

Q.

What interests do OTR’s current officers and directors have in the Business Combination?

 

A.

OTR’s board of directors and executive officers may have interests in the Business Combination that are different from, in addition to or in conflict with, yours. These interests include:

 

   

the beneficial ownership of the Sponsor, which is controlled by Nicholas J. Singer, OTR’s Chairman and Chief Executive Officer, of an aggregate of 8,429,595 shares of OTR Common Stock, consisting of:

 

   

2,611,838 Founder Shares purchased by the Sponsor for an aggregate price of $25,000 (reflecting certain forfeitures to OTR in October and November of 2020 of 7,187,500 Founder Shares originally purchased in August 2020); and

 

   

5,817,757 shares of OTR Common Stock underlying Private Warrants, purchased by the Sponsor at a price of $1.00 per Private Warrant for an aggregate purchase price of approximately $5.8 million;

all of which shares and warrants would become worthless if OTR does not complete a business combination within the applicable time period, as the Sponsor has waived any right to redemption with respect to these shares. Such shares and warrants have an aggregate market value of approximately $[●] and $[●], respectively, based on the closing price of OTR Common Stock of $[●] and the closing price of OTR Warrants of $[●] on the Nasdaq on [●], 2022, the most recent practicable date;

 

   

the economic interests in the Sponsor held by certain of OTR’s officers and directors, which gives them an indirect pecuniary interest in the shares of OTR Common Stock and OTR Warrants held by the Sponsor, and which interests would also become worthless if OTR does not complete a business combination within the applicable time period, including the following:

 

   

in exchange for serving on OTR’s board of directors, (i) each of Mr. Gray, Mr. Besner and Mr. Rozwadowski received, or was promised to receive following the Closing, an economic interest in the Sponsor equivalent to 10,000 shares of OTR Common Stock and (ii) Mr. Neithardt received economic interest in the Sponsor equivalent to 50,613 shares of OTR Common Stock;

 

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in exchange for serving on OTR’s board of directors and as an officer of OTR, (i) Mr. Singer received economic interest in the Sponsor equivalent to 602,347 shares of OTR Common Stock and (ii) Mr. Anderson received economic interest in the Sponsor equivalent to 15,000 shares of OTR Common Stock; and

 

   

other than Mr. Besner, each member of OTR’s board of directors made investments in the equity of the Sponsor as follows: (i) Mr. Singer, indirectly through certain entities, made an investment of $762,634, which gives Mr. Singer an economic interest in the Sponsor equivalent to an additional 261,172 shares of OTR Common Stock and 762,634 OTR Warrants, (ii) Mr. Anderson, indirectly through certain entities, made an investment of $25,000, which gives Mr. Anderson an economic interest in the Sponsor equivalent to an additional 8,562 shares of OTR Common Stock and 25,000 OTR Warrants, (iii) Mr. Neithardt, indirectly through certain entities, made an investment of $862,633, which gives Mr. Neithardt an economic interest in the Sponsor equivalent to an additional 295,418 shares of OTR Common Stock and 862,633 OTR Warrants, (iv) Mr. Gray made an investment of $100,000, which gives Mr. Gray an economic interest in the Sponsor equivalent to an additional 34,246 shares of OTR Common Stock and 100,000 OTR Warrants, and (v) Mr. Rozwadowski made an investment of $225,000, which gives Mr. Rozwadowski an economic interest in the Sponsor equivalent to an additional 61,875 shares of OTR Common Stock and 225,000 OTR Warrants;

 

   

the fact that Sponsor paid $25,000 or approximately $0.0096 per share for the Founders Shares (of which it currently holds 2,611,838), which such Founder Shares, if unrestricted and freely tradeable, would be valued at approximately $[●], based on the closing price of OTR Common Stock on [●], 2022, and that such shares will be worthless if a business combination is not consummated and that the Sponsor and its affiliates can earn a positive rate of return on their investment even if OTR’s public stockholders experience a negative return following the consummation of the Business Combination;

 

   

the anticipated appointment of William A. Wexler, as a director of the Combined Company following the Closing and his eligibility to participate in Holdco’s director compensation program following the consummation of the Business Combination;

 

   

the Sponsor or its affiliates or OTR’s officers and directors may make working capital loans to OTR prior to the closing of an initial business combination, up to $2,500,000 of which may be convertible into warrants similar to the Private Warrants at a price of $1.00 per warrant at the option of the lender, which may not be repaid if an initial business combination is not completed; the 2,500,000 warrants would have an aggregate market value of approximately $[●] million based on the last sale price of $[●] of the OTR Warrants on Nasdaq on [●], 2022. As of [●], 2022, no such working capital loans were outstanding;

 

   

the Sponsors, and OTR’s officers and directors or any of their respective affiliates are entitled to reimbursement for all out-of-pocket expenses incurred in connection with activities on OTR’s behalf such as identifying potential target businesses and performing due diligence on suitable business combinations (with no cap or ceiling on such reimbursement), but will not receive reimbursement for any out-of-pocket expenses to the extent such expenses exceed the amount not required to be retained in the Trust Account, unless an initial business combination is consummated. As of the date hereof, there were no unreimbursed out-of-pocket expenses; and

 

   

the continued indemnification of current directors and officers of OTR and the continuation of directors’ and officers’ liability insurance after the Business Combination.

These interests may influence OTR’s board of directors in making their recommendation that you vote in favor of the approval of the Business Combination Proposal. In particular, the existence of the interests described above may incentivize OTR’s officers and directors to complete an initial business combination, even if on terms less favorable to OTR’s stockholders compared to liquidating OTR, because, among other things, if OTR is liquidated without completing an initial business combination, the Founder Shares and Private Warrants would be worthless (which, if unrestricted and freely tradable, would be worth an

 

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aggregate of approximately $[●] based on the closing price of OTR Common Stock on [●], 2022), out-of-pocket expenses advanced by the Sponsor and loans made by the Sponsor to OTR would not be repaid to the extent such amounts exceed cash held by OTR outside of the Trust Account (which such expenses and loans, as of [●], amounted to $[●]). You should also read the section entitled “The Business Combination — Interests of OTR’s Directors and Officers in the Business Combination.”

 

Q.

Did OTR’s board of directors obtain a third-party valuation or fairness opinion in determining whether to proceed with the Business Combination?

 

A.

OTR’s board of directors did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the Business Combination. OTR’s board of directors believes that based upon the financial skills and background of its directors, it was qualified to conclude that the Business Combination was fair from a financial perspective to its stockholders. OTR’s board of directors also determined, without seeking a valuation from a financial advisor, that Comera’s fair market value was at least 80% of OTR’s net assets, excluding any taxes payable on interest earned. Accordingly, investors will be relying on the judgment of OTR’s board of directors as described above in valuing Comera’s business and assuming the risk that OTR’s board of directors may not have properly valued such business.

 

Q.

What happens if the Business Combination Proposal is not approved?

 

A.

If the Business Combination Proposal is not approved and OTR does not consummate a business combination by May 19, 2022, or receive stockholder approval to amend its amended and restated certificate of incorporation to extend the date by which OTR must consummate an initial business combination, OTR will be required to dissolve and liquidate the Trust Account.

 

Q.

How do the Public Warrants differ from the Private Warrants and what are the related risks to any holders of Public Warrants following the Business Combination?

 

A.

The Private Warrants are identical to the Public Warrants in all material respects, except that the Private Warrants will not be transferable, assignable or salable until 30 days after the completion of the Business Combination and they will not be redeemable by Holdco so long as they are held by the Sponsor or its permitted transferees. The Sponsor, or its permitted transferees, has the option to exercise the Private Warrants on a cashless basis. If the Private Warrants are held by holders other than the Sponsor or its permitted transferees, the Private Warrants will be redeemable by Holdco in all redemption scenarios and exercisable by the holders on the same basis as the Public Warrants.

Following the Business Combination, Holdco may redeem the Holdco Warrants, other than the Holdco Warrants that were exchanged for Private Warrants (the “Holdco Public Warrants”), prior to their exercise at a time that is disadvantageous to the holder, thereby significantly impairing the value of such warrants. Holdco will have the ability to redeem outstanding Holdco Public Warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the closing price of the Holdco Common Stock equals or exceeds $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading day period ending on the third trading day prior to the date on which a notice of redemption is sent to the holders of the Holdco Public Warrants. Holdco will not redeem the Holdco Public Warrants as described above unless a registration statement under the Securities Act covering the shares of Holdco Common Stock issuable upon exercise of such warrants is effective and a current prospectus relating to those shares of Holdco Common Stock is available throughout the 30-day redemption period. If and when the Holdco Public Warrants become redeemable by Holdco, if Holdco has elected to require the exercise of Holdco Public Warrants on a cashless basis, Holdco will not redeem the warrants as described above if the issuance of shares of Holdco Common Stock upon exercise of Holdco Public Warrants is not exempt from registration or qualification under applicable state securities laws or Holdco is unable to effect such registration or qualification. Redemption of the outstanding Holdco Public Warrants could force you (i) to exercise your Holdco Public Warrants and pay the exercise price therefor at a time when it may be

 

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disadvantageous for you to do so, (ii) to sell your Holdco Public Warrants at the then-current market price when you might otherwise wish to hold your Holdco Public Warrants, or (iii) to accept the nominal redemption price which, at the time the outstanding Holdco Public Warrants are called for redemption, is likely to be substantially less than the market value of your Holdco Public Warrants. The closing price for the OTR Class A Common Stock as of [●], 2022 was $[●] and has never exceeded the $18.00 threshold that would trigger the right to redeem the Holdco Public Warrants following the Closing.

Holdco may only call the Holdco Public Warrants for redemption upon a minimum of 30 days’ prior written notice of redemption to each registered holder pursuant to the terms of the OTR Warrant Agreement (assumed by Holdco at Closing), provided that holders will be able to exercise their Holdco Warrants prior to the time of redemption and, at Holdco’s election, any such exercise may be required to be on a cashless basis.

 

Q.

Do I have redemption rights?

 

A.

If you are a holder of Public Shares, you may redeem your Public Shares for cash equal to their pro rata share of the aggregate amount on deposit in the Trust Account, which holds the proceeds of the IPO, as of two business days prior to the consummation of the Business Combination, including interest earned on the funds held in the Trust Account and not previously released to OTR to pay its taxes, upon the consummation of the Business Combination. The per-share amount OTR will distribute to holders who properly redeem their shares will not be reduced by the deferred underwriting commissions OTR will pay to the underwriters of its IPO if the Business Combination is consummated. Holders of the outstanding Public Warrants do not have redemption rights with respect to such warrants in connection with the Business Combination. All of the holders of the Founder Shares have agreed to waive their redemption rights with respect to their Founder Shares and any shares of OTR Class A Common Stock that they may have acquired during or after the IPO in connection with the completion of OTR’s initial business combination. The Founder Shares will be excluded from the pro rata calculation used to determine the per-share redemption price. OTR issued to Maxim Partners LLC (“Maxim Partners”), the representative of the underwriters in the IPO, 182,829 shares of OTR Class A Common Stock (the “Maxim Shares”) upon the consummation of the IPO, and Maxim Partners agreed to waive the redemption rights with respect to the Maxim Shares. For illustrative purposes, based on funds in the Trust Account of approximately $[●] on [●], 2022, the estimated per share redemption price would have been approximately $10.25. This is greater than the $10.00 IPO price of OTR’s Units. Additionally, Public Shares properly tendered for redemption will only be redeemed if the Business Combination is consummated; otherwise, holders of such shares will only be entitled to a pro rata portion of the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to OTR to pay its taxes (less up to $100,000 of net interest to pay dissolution expenses), in connection with the liquidation of the Trust Account.

 

Q.

Is there a limit on the number of shares I may redeem?

 

A.

A Public Stockholder, together with any affiliate of his or any other person with whom he is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act) will be restricted from seeking redemption rights with respect to 15% or more of the Public Shares. Accordingly, all shares in excess of 15% of the Public Shares owned by a holder will not be redeemed. On the other hand, a Public Stockholder who holds less than 15% of the Public Shares may redeem all of the Public Shares held by him or her for cash.

 

Q.

Will how I vote affect my ability to exercise redemption rights?

 

A.

No. You may exercise your redemption rights whether you vote your Public Shares for or against the Business Combination Proposal or any other proposal described in this proxy statement/prospectus, or do not vote your shares. As a result, the Business Combination Proposal, Charter Amendment Proposal and the Equity Incentive Award Plan Proposal can be approved by stockholders who will redeem their Public Shares and no longer remain stockholders, leaving stockholders who choose not to redeem their Public Shares

 

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  holding shares in a company with a less liquid trading market, fewer stockholders, less cash and the potential inability to meet the listing standards of Nasdaq.

 

Q.

How do I exercise my redemption rights?

 

A.

In order to exercise your redemption rights, you must, prior to 4:30 p.m. Eastern time on                 , 2022 (two business days before the special meeting), (i) submit a written request to OTR’s transfer agent that OTR redeem your Public Shares for cash, and (ii) deliver your stock to OTR’s transfer agent physically or electronically through the Depository Trust Company (“DTC”). The address of Continental Stock Transfer & Trust Company, OTR’s transfer agent, is listed under the question “Who can help answer my questions?” below. OTR requests that any requests for redemption include the identity as to the beneficial owner making such request. Electronic delivery of your stock generally will be faster than delivery of physical stock certificates.

A physical stock certificate will not be needed if your stock is delivered to OTR’s transfer agent electronically. In order to obtain a physical stock certificate, a stockholder’s broker and/or clearing broker, DTC and OTR’s transfer agent will need to act to facilitate the request. It is OTR’s understanding that stockholders should generally allot at least one week to obtain physical certificates from the transfer agent. However, because OTR does not have any control over this process or over the brokers or DTC, it may take significantly longer than one week to obtain a physical stock certificate. If it takes longer than anticipated to obtain a physical certificate, stockholders who wish to redeem their shares may be unable to obtain physical certificates by the deadline for exercising their redemption rights and thus will be unable to redeem their shares.

Any demand for redemption, once made, may be withdrawn at any time until the deadline for exercising redemption requests and thereafter, with OTR’s consent, until the vote is taken with respect to the Business Combination. If you delivered your shares for redemption to OTR’s transfer agent and decide within the required timeframe not to exercise your redemption rights, you may request that OTR’s transfer agent return the shares (physically or electronically). Such requests may be made by contacting OTR’s transfer agent at the phone number or address listed under the question “Who can help answer my questions?”

 

Q.

What are the U.S. federal income tax consequences of exercising my redemption rights?

 

A.

We expect that U.S. holders (as defined in the section entitled “Material U.S. Federal Income Tax Considerations — U.S. Holders”) who exercise their redemption rights to receive cash from the Trust Account in exchange for their OTR Common Stock generally will be required to treat the transaction as a sale of such shares and recognize gain or loss upon the redemption in an amount equal to the difference, if any, between the amount of cash received and the tax basis of the OTR Common Stock redeemed. Such gain or loss should be treated as capital gain or loss if such shares were held as a capital asset on the date of the redemption. A shareholder’s tax basis in its OTR Common Stock generally will equal the cost of such shares. A shareholder who purchased OTR Units will have to allocate the cost between the OTR Common Stock and OTR Warrants comprising the OTR Units based on their relative fair market values at the time of the purchase. However, in certain situations, the cash paid to U.S. holders in the redemption may be treated as dividend income for U.S. federal income tax purposes. For a more complete discussion of the U.S. federal income tax consequences of exercising redemption rights, see the section entitled “Material U.S. Federal Income Tax Considerations.”

 

Q.

Will holders of shares of OTR Common Stock or Comera Common Stock be taxed on the shares of Holdco Common Stock received in the Business Combination?

 

A.

The exchange by a U.S. holder of OTR Common Stock or Comera Common Stock for Holdco Common Stock pursuant to the Business Combination, taken together, should qualify as an exchange described in Section 351(a) of the Code. However, the provisions of Section 351(a) of the Code are complex and qualification as a non-recognition transaction thereunder could be adversely affected by events or actions that

 

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  occur following the Business Combination that are beyond OTR’s or Comera’s control. For example, if more than 20% of the Holdco Common Stock were subject to an arrangement or agreement to be sold or disposed of at the time of their issuance in the Business Combination, one of the requirements for Section 351(a) treatment would be violated. We do not expect that any of the Holdco Common Stock issued in the Business Combination that will be subject to contractual restrictions on transfer will be subject to an arrangement or agreement by its owner to sell or dispose of such shares upon the issuance of those shares in the Business Combination. Accordingly, a U.S. holder that exchanges its OTR Common Stock or Comera Common Stock in the Business Combination for Holdco Common Stock generally should not recognize any gain or loss on such exchange. In such case, the aggregate adjusted tax basis of the Holdco Common Stock received in the Business Combination by a U.S. holder should be equal to the adjusted tax basis of the OTR Common Stock or Comera Common Stock surrendered in the Business Combination in exchange therefor. The holding period of the Holdco Common Stock should include the holding period of the OTR Common Stock or Comera Common Stock surrendered in the Business Combination in exchange therefor. The U.S. federal income tax consequences of the Business Combination are described in more detail in the section entitled “Material U.S. Federal Income Tax Considerations.”

 

Q.

If I hold OTR Warrants, what are the U.S. federal income tax consequences of my OTR Warrants converting to Holdco Warrants?

 

A.

In connection with the Business Combination, each issued and outstanding OTR Warrant will cease to represent a right to acquire one share of OTR Common Stock and will instead represent the right to acquire one share of Holdco Common Stock, at the same exercise price and on the same terms as in effect immediately prior to the OTR Merger Effective Time.

If the OTR Merger qualifies as a “reorganization” under Section 368 of the Code, a U.S. holder (as defined in the section entitled “Material U.S. Federal Income Tax Considerations — U.S. Holders”) of OTR Warrants generally should not recognize any gain or loss upon the conversion of the OTR Warrants to Holdco Warrants; the aggregate tax basis of such U.S. holder’s basis in the Holdco Warrants will be the same as the aggregate tax basis of such U.S. holder’s OTR Warrants immediately before the closing of the Business Combination; and the holding period of such warrants will continue, provided that the OTR Warrants are held as capital assets on the effective date of the closing of the Business Combination. However, it is unclear whether the requirements of Section 368 of the Code can be satisfied and such qualification is not a condition of the Business Combination.

If the OTR Merger does not qualify as a “reorganization” under Section 368 of the Code, a U.S. holder of OTR Warrants could be treated as transferring its OTR Warrants to Holdco in exchange for Holdco Warrants in an exchange governed only by Section 351 of the Code. If so treated, a U.S. holder should be required to recognize gain (but not loss) in an amount equal to the lesser of (i) the amount of gain realized by such holder (generally, the excess of (x) the sum of the fair market values of the Holdco Warrants treated as received by such holder and the Holdco Common Stock received by such holder, if any, over (y) such holder’s aggregate adjusted tax basis in the OTR Warrants and OTR Common Stock, if any, exchanged therefor) and (ii) the fair market value of the Holdco Warrants received by such holder in such exchange.

Greenberg Traurig, P.A. (“Greenberg”) is unable to opine with respect to the OTR Merger’s qualification as a reorganization under Section 368 of the Code. For an additional discussion of the U.S. federal income tax treatment of OTR Warrants in connection with the Business Combination, see the section entitled “Material U.S. Federal Income Tax Consequences — U.S. Holders — The Business Combination.”

 

Q.

If I hold OTR Warrants, can I exercise redemption rights with respect to my warrants?

 

A.

No. Holders of OTR Warrants do not have any redemption rights with respect to such warrants.

 

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Q.

If I hold OTR Units, will they continue to trade after the closing?

No. Upon completion of the Business Combination, any outstanding OTR Units will automatically separate into their component parts. No fractional warrants will be issued; however, nor will consideration be paid for any fractional warrant.

 

Q.

Do I have appraisal rights if I object to the proposed Business Combination?

 

A.

No. There are no appraisal rights available to holders of shares of OTR Common Stock in connection with the Business Combination.

 

Q.

What happens to the funds held in the Trust Account upon consummation of the Business Combination?

 

A.

If the Business Combination is consummated, the funds held in the Trust Account will be released to pay (i) OTR stockholders who properly exercise their redemption rights and (ii) expenses incurred by Comera and OTR in connection with the Business Combination, to the extent not otherwise paid prior to the Closing. Any additional funds available for release from the Trust Account will be used for general corporate purposes of OTR and Comera following the Business Combination.

 

Q.

What happens if the Business Combination is not consummated?

 

A.

There are certain circumstances under which the Business Combination Agreement may be terminated. See the section entitled “The Business Combination Agreement — Termination” for information regarding the parties’ specific termination rights.

If, as a result of the termination of the Business Combination Agreement or otherwise, OTR is unable to complete a business combination by May 19, 2022 or obtain the approval of OTR stockholders to extend the deadline for OTR to consummate an initial business combination prior to that date, OTR’s amended and restated certificate of incorporation provides that OTR 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 100% of the outstanding Public Shares, at a per share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including any interest not previously released to OTR but net of taxes payable, divided by the number of then outstanding Public Shares, which redemption will completely extinguish Public Stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of OTR’s remaining stockholders and OTR’s board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. See the sections entitled “Risk Factors — OTR may not be able to consummate an initial business combination within the required time period, in which case it would cease all operations except for the purpose of winding up and it would redeem the Public Shares and liquidate.” The Sponsor has waived any right to any liquidation distribution with respect to the Founder Shares.

In the event of liquidation, there will be no distribution with respect to outstanding OTR Warrants. Accordingly, the OTR Warrants will expire worthless.

 

Q.

When is the Business Combination expected to be completed?

 

A.

It is currently anticipated that the Business Combination will be consummated promptly following the special meeting of stockholders, provided that all other conditions to the consummation of the Business Combination have been satisfied or waived.

For a description of the conditions to the completion of the Business Combination, see the section entitled “The Business Combination Agreement — Conditions to Closing.”

 

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Q.

What do I need to do now?

 

A.

You are urged to carefully read and consider the information contained in this proxy statement/prospectus, including the financial statements and annexes attached hereto, and to consider how the Business Combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker, bank or nominee.

 

Q.

How do I vote?

 

A.

If you were a holder of record of OTR Common Stock on [●], 2022, the record date for the special meeting of stockholders, you may vote with respect to the applicable proposals in person via the virtual meeting platform at the special meeting or by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided.

Voting by Mail. By signing the proxy card and returning it in the enclosed postage-paid envelope, you are authorizing the individuals named on the proxy card to vote your shares of OTR Common Stock at the special meeting in the manner you indicate. OTR encourages you to sign and return the proxy card even if you plan to attend the special meeting so that your shares will be voted if you are unable to attend the special meeting. If you receive more than one proxy card, it is an indication that your shares are held in multiple accounts. Please sign and return all proxy cards to ensure that all of your shares are voted. Votes submitted by mail must be received by [●] Eastern Time on [●], 2022.

Voting at the Special Meeting via the Virtual Meeting Platform. If you attend the special meeting and plan to vote in person via the virtual meeting platform, you will be provided with explicit instructions on how to vote in person via the virtual meeting platform. If your shares of OTR Common Stock are registered directly in your name, you are considered the stockholder of record and you have the right to vote in person via the virtual meeting platform at the special meeting. If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or other nominee, you should follow the instructions provided by your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the record holder of your shares with instructions on how to vote your shares or, if you wish to attend the special meeting and vote in person via the virtual meeting platform, you will need to contact your broker, bank or nominee to obtain a legal proxy that will authorize you to vote these shares. For additional information, please see the section entitled “The Special Meeting of OTR Stockholders.”

 

Q.

What will happen if I abstain from voting or fail to vote at the special meeting?

 

A.

At the special meeting of stockholders, OTR will count a properly executed proxy marked “ABSTAIN” with respect to a particular proposal as present for purposes of determining whether a quorum is present. For purposes of approval, an abstention will have the same effect as a vote “against” the Business Combination Proposal and will have no effect on the Charter Amendment Proposal, Equity Incentive Award Plan Proposal or Adjournment Proposal. Failure to vote by proxy or to vote in person (which would include presence at a virtual meeting) at the special meeting will have the same effect as a vote “against” the Business Combination Proposal and have no effect on the Charter Amendment Proposal, Equity Incentive Award Plan Proposal or Adjournment Proposal.

 

Q.

What will happen if I sign and return my proxy card without indicating how I wish to vote?

 

A.

Signed and dated proxies received by OTR without an indication of how the stockholder intends to vote on a proposal will be voted in favor of each proposal presented to the stockholders. The proxyholders may use their discretion to vote on any other matters which properly come before the special meeting.

 

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Q.

Do I need to attend the special meeting of stockholders virtually to vote my shares?

 

A.

No. You are invited to attend the special meeting virtually to vote on the proposals described in this proxy statement/prospectus. However, you do not need to attend the special meeting of stockholders to vote your shares. Instead, you may submit your proxy by signing, dating and returning the applicable enclosed proxy card(s) in the pre-addressed postage-paid envelope. Your vote is important. OTR encourages you to vote as soon as possible after carefully reading this proxy statement/prospectus.

 

Q.

If I am not going to attend the special meeting of stockholders virtually, should I return my proxy card instead?

 

A.

Yes. Whether you plan to attend the special meeting virtually or not, please read and consider the information contained in this proxy statement/prospectus carefully and vote your shares of OTR Common Stock by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided.

 

Q.

If my shares are held in “street name,” will my broker, bank or nominee automatically vote my shares for me?

 

A.

No. If your broker holds your shares in its name and you do not give the broker voting instructions, under the applicable stock exchange rules, your broker may not vote your shares on any of the OTR Proposals. If you do not give your broker voting instructions and the broker does not vote your shares, this is referred to as a “broker non-vote.” Broker non-votes will not be counted for purposes of determining the presence of a quorum at the special meeting of stockholders. Your bank, broker, or other nominee can vote your shares only if you provide instructions on how to vote. You should instruct your broker to vote your shares in accordance with directions you provide. However, in no event will a broker non-vote have the effect of exercising your redemption rights for a pro rata portion of the Trust Account, and therefore no shares as to which a broker non-vote occurs will be converted in connection with the proposed Business Combination.

 

Q.

May I change my vote after I have mailed my signed proxy card?

 

A.

Yes. You may change your vote by sending a later-dated, signed proxy card to OTR’s secretary at the address listed below prior to the vote at the special meeting of stockholders, or attend the special meeting and vote in person virtually. You also may revoke your proxy by sending a notice of revocation to OTR’s secretary, provided such revocation is received prior to the vote at the special meeting. If your shares are held in street name by a broker or other nominee, you must contact the broker or nominee to change your vote.

 

Q.

What should I do if I receive more than one set of voting materials?

 

A.

You may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast your vote with respect to all of your shares.

 

Q.

What is the quorum requirement for the special meeting of stockholders?

 

A.

A quorum will be present at the special meeting of stockholders if a majority of the OTR Common Stock outstanding and entitled to vote at the meeting is represented in person (which would include presence at a virtual meeting) or by proxy.

 

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As of the record date for the special meeting, 6,621,009 shares of OTR Common Stock would be required to achieve a quorum.

Your shares will be counted towards the quorum only if you submit a valid proxy (or your broker, bank or other nominee submits one on your behalf) or if you vote in person (which would include presence at a virtual meeting) at the special meeting of stockholders. Abstentions will be counted towards the quorum requirement. If there is no quorum, a majority of the shares represented by stockholders present at the special meeting or by proxy may authorize adjournment of the special meeting to another date.

 

Q.

Who will solicit and pay the cost of soliciting proxies?

 

A.

OTR will pay the cost of soliciting proxies for the special meeting. OTR has engaged [●] to assist in the solicitation of proxies for the special meeting. OTR has agreed to pay [●] a fee of $[●]. OTR will reimburse [●] for reasonable out-of-pocket expenses and will indemnify [●] and its affiliates against certain claims, liabilities, losses, damages and expenses. OTR also will reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of shares of OTR Common Stock for their expenses in forwarding soliciting materials to beneficial owners of OTR Common Stock and in obtaining voting instructions from those owners. OTR’s directors, officers and employees may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person. They will not be paid any additional amounts for soliciting proxies.

 

Q.

Who can help answer my questions?

 

A.

If you have questions about the stockholder proposals, or if you need additional copies of this proxy statement/prospectus, the proxy card or the consent card you should contact our proxy solicitor at:

[●]

[●]

Telephone: [●]

Banks and brokers can call collect at: [●]

Email: [●]

You may also contact OTR at:

OTR Acquisition Corp.

1395 Brickell Avenue, Suite 800

Miami, Florida 33131

(305) 697-9600

Attention: Chief Executive Officer

To obtain timely delivery, OTR’s stockholders and warrant holders must request the materials no later than five business days prior to the special meeting.

You may also obtain additional information about OTR from documents filed with the SEC by following the instructions in the section entitled “Where You Can Find More Information.”

If you intend to seek redemption of your Public Shares, you will need to send a letter demanding redemption and deliver your stock (either physically or electronically) to OTR’s transfer agent prior to 4:30 p.m., New York time, on the second business day prior to the special meeting of stockholders. If you have questions regarding the certification of your position or delivery of your stock, please contact:

Continental Stock Transfer & Trust Company

One State Street Plaza, 30th Floor

New York, New York 10004

Attention: Celeste Gonzalez

E-mail: cgonzalez@continentalstock.com

 

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SUMMARY OF THE PROXY STATEMENT/PROSPECTUS

This summary highlights selected information from this proxy statement/prospectus and does not contain all of the information that is important to you. To better understand the Business Combination and the proposals to be considered at the special meeting, you should read this proxy statement/prospectus carefully and in its entirety, including the annexes. See also the section entitled “Where You Can Find More Information.”

Parties to the Business Combination

OTR

OTR is a Delaware corporation formed for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities, referred to throughout this proxy statement/prospectus as its initial business combination. OTR may pursue its initial business combination in any business, industry or geographic region.

OTR Common Stock, OTR Warrants and OTR Units, consisting of one share of OTR Common Stock and one-half OTR Warrant, are traded on the Nasdaq under the ticker symbols “OTRA,” “OTRAW” and “OTRAU,” respectively.

The mailing address of OTR’s principal executive office is 1395 Brickell Avenue, Suite 800, Miami, Florida 33131, and its telephone number is (305) 697-9600.

For more information about OTR, see the sections entitled “Information About OTR” and “OTR Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Comera

Comera is a biotechnology company dedicated to promoting a compassionate new era in medicine by applying a deep knowledge of formulation science and technology to transform essential biologic medicines from intravenous to subcutaneous forms. This transformation in administration provides patients and families the freedom of self-injectable care. Without the need to receive intravenous treatment at a medical facility, patients can more fully realize the potential of biologic treatments and to enjoy the potential of their own lives.

The mailing address of Comera’s principal executive office is 12 Gill Street, Suite 4650, Woburn, Massachusetts 01801.

For more information about Comera, see the sections entitled “Information About Comera” and “Comera Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Holdco

Holdco was incorporated on January 25, 2022 solely for the purpose of effectuating the Business Combination described herein. Holdco is a Delaware corporation. Holdco owns no material assets and does not operate any business.

Prior to the consummation of the Business Combination, the sole stockholder of Holdco is Comera and the sole director of Holdco is Jeffrey S. Hackman.

Holdco intends to apply to list the Holdco Common Stock and Holdco Warrants on the Nasdaq under the symbols “CMRA” and “CMRAW,” respectively, upon the Closing.

The address of Holdco’s registered office is 3411 Silverside Road Tatnall Building, Building #104, Wilmington, DE 19810.

 

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Comera Merger Sub

Comera Merger Sub is a Delaware corporation and is a direct wholly owned subsidiary of Holdco. Comera Merger Sub was formed solely in contemplation of the Business Combination, has not commenced any operations, has only nominal assets and has no liabilities or contingent liabilities, nor any outstanding commitments other than in connection with the Business Combination.

The address of Comera Merger Sub’s registered office is 3411 Silverside Road Tatnall Building, Building #104, Wilmington, DE 19810.

OTR Merger Sub

OTR Merger Sub is a Delaware corporation and is a direct wholly owned subsidiary of Holdco. OTR Merger Sub was formed solely in contemplation of the Business Combination, has not commenced any operations, has only nominal assets and has no liabilities or contingent liabilities, nor any outstanding commitments other than in connection with the Business Combination.

The address of OTR Merger Sub’s registered office is 3411 Silverside Road Tatnall Building, Building #104, Wilmington, DE 19810.

The Business Combination

The Business Combination Agreement

On January 31, 2022, OTR, Holdco, Comera Merger Sub, OTR Merger Sub and Comera entered into the Business Combination Agreement, pursuant to which (i) Comera Merger Sub will be merged with and into Comera, with Comera surviving the Comera Merger as a direct wholly-owned subsidiary of Holdco and (ii) immediately following the consummation of the Comera Merger, OTR Merger Sub will be merged with and into OTR, with OTR surviving the OTR Merger as a direct wholly-owned subsidiary of Holdco. The Business Combination Agreement contains customary representations and warranties, covenants, closing conditions and other terms relating to the Mergers and the other transactions contemplated thereby.

The Comera Merger will become effective by the filing of a certificate of merger with the Secretary of State of the State of Delaware and will be effective immediately upon such filing or upon such later time as may be agreed by the parties and specified in such certificate of merger (such time, the “Comera Merger Effective Time”). The OTR Merger will become effective by the filing of a certificate of merger with the Secretary of State of the State of Delaware and will be effective immediately upon such filing or upon such later time as may be agreed by the parties and specified in such certificate of merger (such time, the “OTR Merger Effective Time”). The Closing will take place within three business days following the satisfaction or waiver (to the extent such waiver is permitted by applicable law) of the conditions set forth in the Business Combination Agreement (other than those conditions that by their nature are to be satisfied at Closing, but subject to the satisfaction or waiver of those conditions at such time), or on such other date, time or place as OTR, Comera and Holdco may mutually agree.

At the Comera Merger Effective Time, by virtue of the Comera Merger and without any action on the part of Comera, Holdco, Comera Merger Sub or the holders of any of the following securities:

 

   

Immediately prior to the Comera Merger Effective Time, each share of Comera Preferred Stock that is issued and outstanding immediately prior to the Comera Merger Effective Time will be converted into an equal number of shares of Comera Common Stock in accordance with the Written Consent and with the terms of Article Fourth, Section (B)(5) of the Comera Certificate of Incorporation (the

 

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“Conversion”), and each converted share of Comera Preferred Stock will no longer be outstanding and will cease to exist, such that each holder of Comera Preferred Stock will thereafter cease to have any rights with respect to such Comera Preferred Stock, but will hold Comera Common Stock;

 

   

Following the Conversion, all shares of Comera Common Stock issued and outstanding immediately prior to the Comera Merger Effective Time (excluding dissenting shares) will be canceled and converted into the right to receive the number of shares of Holdco Common Stock and the portion of the Earn-Out Shares, if released from escrow in accordance with the Business Combination Agreement, set forth in the Payment Spreadsheet (as defined below);

 

   

Each Comera Vested In-the-Money Option outstanding immediately prior to the Comera Merger Effective Time will be canceled and converted into the right to receive the number of shares of Holdco Common Stock set forth in the Payment Spreadsheet;

 

   

All shares of Comera Common Stock and Comera Preferred Stock held in the treasury of Comera will be canceled without any conversion thereof and no payment or distribution will be made with respect thereto;

 

   

Each share of common stock, par value $0.0001 per share, of Comera Merger Sub (the “Comera Merger Sub Common Stock”) issued and outstanding immediately prior to the Comera Merger Effective Time will be converted into and become the right to receive one validly issued, fully paid and nonassessable share of common stock, par value $0.0001 per share, of Comera Merger Surviving Corporation; and

 

   

Each Comera Unvested Option and each Comera Vested Out-of-the-Money Option that is outstanding immediately prior to the Comera Merger Effective Time, will be converted into the number of options to purchase shares of Holdco Common Stock (such options, the “Exchanged Options”) in accordance with the Payment Spreadsheet. Except as specifically provided in the Business Combination Agreement, following the Comera Merger Effective Time, each Exchanged Option will continue to be governed by the same terms and conditions (including vesting and exercisability terms) as were applicable to the corresponding former Comera Option immediately prior to the Comera Merger Effective Time.

At the OTR Merger Effective Time, by virtue of the OTR Merger and without any action on the part of OTR, Holdco, OTR Merger Sub or the holders of any of the following securities:

 

   

Immediately prior to the OTR Merger Effective Time, all shares of OTR Class B Common Stock will be converted into shares of OTR Class A Common Stock (“OTR Class B Conversion”);

 

   

Immediately prior to the OTR Merger Effective Time, the shares of OTR Class A Common Stock and the OTR Warrants comprising each issued and outstanding OTR Unit immediately prior to the OTR Merger Effective Time will be automatically separated (the “Unit Separation”) and the holder thereof will be deemed to hold one share of OTR Class A Common Stock and one-half of one OTR Warrant, provided that no fractional OTR Warrants will be issued in connection with the Unit Separation such that if a holder of OTR Units would be entitled to receive a fractional OTR Warrant upon the Unit Separation nor any payment in lieu of such fraction, the number of OTR Warrants to be issued to such holder upon the Unit Separation will be rounded down to the nearest whole number of OTR Warrants;

 

   

Following the OTR Class B Conversion and Unit Separation, each share of OTR Class A Common Stock issued and outstanding immediately prior to the OTR Merger Effective Time will automatically be converted into and become the right to receive one (1) share of Holdco Common Stock;

 

   

All shares of OTR Common Stock held in the treasury of OTR will be canceled without any conversion thereof and no payment or distribution will be made with respect thereto; and

 

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Each share of common stock, par value $0.0001 per share, of OTR Merger Sub (the “OTR Merger Sub Common Stock”) issued and outstanding immediately prior to the OTR Merger Effective Time will be converted into and become the right to receive one (1) validly issued, fully paid and nonassessable share of common stock, par value $0.0001 per share, of OTR Merger Surviving Corporation.

At the Closing, in addition to the Aggregate Comera Consideration and as part of the overall consideration payable to the holders of Comera Common Stock and holders of Comera Vested In-the-Money Options pursuant to the Business Combination Agreement, Holdco shall place three million one hundred fifty thousand (3,150,000) shares of Holdco Common Stock (the “Earn-Out Shares”) into escrow with the Escrow Agent pursuant to the Escrow Agreement. If, at any time during the period beginning on the Closing Date and expiring at the close of business on the second anniversary of the Closing Date (the “Earn-Out Period”), the VWAP of Holdco Common Stock shall be equal to or greater than $12.50 for any twenty (20) Trading Days within a period of thirty (30) consecutive Trading Days (the “Earn-Out Trigger”), then within ten (10) Business Days following the achievement of the Earn-Out Trigger, Holdco shall instruct the Escrow Agent to deliver the Earn-Out Shares to the holders of Comera Common Stock and holders of Comera Vested In-the-Money Options, in each case in accordance with the Payment Spreadsheet.

If a Change of Control occurs during the Earn-Out Period that results in the holders of shares of Holdco Common Stock receiving consideration equal to or in excess of $12.50 per share, then, immediately prior to the consummation of such Change of Control, (i) the Earn-Out Trigger, to the extent that it has not been previously satisfied, shall be deemed to be satisfied, and (ii) Holdco shall promptly instruct the Escrow Agent to deliver the Earn-Out Shares to the holders of Comera Common Stock and holders of Comera Vested In-the-Money Options, in each case in accordance with the Payment Spreadsheet.

If the Earn-Out Trigger shall not be achieved during the Earn-Out Period, then, upon expiration of the Earn-Out Period, Holdco shall instruct the Escrow Agent to deliver the Earn-Out Shares to Holdco for cancellation.

The Earn-Out Shares and the Earn-Out Trigger shall be adjusted, and additional shares of Holdco Common Stock shall be delivered to the Escrow Agent as necessary, to reflect appropriately the effect of any stock split, reverse stock split, stock dividend (including any dividend or distribution of securities convertible into Holdco Common Stock), reorganization, recapitalization, reclassification, combination, exchange of shares or other like change with respect to Holdco Common Stock, occurring on or after the date hereof and prior to the time any such Earn-Out Shares are delivered to the holders of Comera Common Stock and Comera Vested In-the-Money Options.

Not less than five business days prior to the Comera Merger Effective Time, Comera shall deliver to OTR a schedule (the “Payment Spreadsheet”) setting forth (i) the calculation of Aggregate Comera Consideration (as defined below), (ii) the allocation of the Aggregate Comera Consideration and the Earn-Out Shares, if released from escrow in accordance with the Business Combination Agreement, among the holders of Comera Common Stock and the holders of Comera Vested In-the-Money Options (taking into account, with respect to the holders of Comera Vested In-the-Money Options, the aggregate exercise price of all such Comera Options), (iii) the portion of the Aggregate Comera Consideration payable to each holder of Comera Common Stock and each holder of Comera Vested In-the-Money Options, and (iv) the number of shares of Holdco Common Stock and the Earn-Out Shares, if released from escrow in accordance with the Business Combination Agreement, that can be purchased under the Exchanged Options. The allocation of the Aggregate Comera Consideration and Earn-Out Shares and the information with respect to the exchange of Comera Options into Exchanged Options set forth in the Payment Spreadsheet shall be binding on all parties and shall be used by Holdco for purposes of issuing the Aggregate Comera Consideration and allocating the Earn-Out Shares, if released from escrow in accordance with the Business Combination Agreement, to the holders of Comera Common Stock and conversion of the Comera

 

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Options into the Exchanged Options, absent manifest error. “Aggregate Comera Consideration” means a number of shares of OTR Common Stock equal to the quotient of (A) $126,000,000, less any Leakage since September 30, 2021 divided by (B) $10.00.

For more information about the Business Combination Agreement and the Business Combination and other transactions contemplated thereby, see the sections entitled “Proposal No. 1 — The Business Combination Proposal” and “The Business Combination Agreement.”

Conditions to Closing

Unless waived by the parties, under the Business Combination Agreement, the consummation of the Business Combination is subject to customary and other conditions, including (i) the Business Combination Proposal and the other proposals being considered at the OTR special meeting having been approved and adopted by the requisite affirmative vote of OTR’s stockholders, (ii) the Written Consent having been delivered to OTR, (iii) the absence of any governmental law or order that would prohibit the Business Combination, (iv) OTR having at least $5,000,001 in net tangible assets after giving effect to the exercise of redemption rights by Public Stockholders, (v) all parties to the Registration Rights and Lock-Up Agreement and Letter Agreement having delivered duly executed copies of such agreements, (vi) the representations and warranties of the parties to the Business Combination Agreement being true and correct, subject to the de minimis, materiality and material adverse effect standards contained in the Business Combination Agreement, (vii) material compliance by the parties with their respective covenants, (viii) the receipt of the Comera Merger Sub Requisite Approval by OTR, (ix) the receipt of the OTR Merger Sub Requisite Approval by OTR, (x) the receipt of the Holdco Requisite Approval by OTR, (xi) the registration statement of which this proxy statement/prospectus forms a part having been declared effective and no stop order or other proceedings suspecting its effectiveness having been institute, (xii) the Holdco Common Stock having been approved for listing on Nasdaq, and (xiii) the executed written resignations of certain officers or directors of OTR, effective as of the OTR Merger Effective Time, having been delivered to OTR.

Notwithstanding the foregoing, certain closing conditions may not be waived due to the parties’ charter or organizational documents, applicable law, or otherwise. The following closing conditions may not be waived: receipt of the requisite stockholder approvals, the absence of any law or order that would prohibit the consummation of the Business Combination and the effectiveness of the registration statement. The foregoing closing conditions are the only closing conditions to the Business Combination that may not be waived. All other closing conditions to the Business Combination may be waived by Comera, OTR or the other parties to the Business Combination Agreement.

For more information, see the section entitled “The Business Combination — Conditions to Closing.”

Termination

The Business Combination Agreement is subject to termination prior to the Comera Merger Effective Time as follows:

 

   

by mutual written consent of OTR and Comera;

 

   

by OTR or Comera, if the OTR Merger Effective Time will not have occurred prior to May 19, 2022 (the “Outside Date”); provided that if an extension proposal is approved at a relevant OTR stockholders’ meeting, the Outside Date shall be the last day of the extended time period for OTR to consummate a business combination; provided, further, that the Business Combination Agreement may not be terminated by any party that either directly or indirectly through its affiliates is in breach or violation of any representation, warranty, covenant, agreement or obligation contained therein and such breach or violation is the principal cause of the failure of a condition to the Mergers on or prior to the Outside Date;

 

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any governmental authority in the United States has enacted, issued, promulgated, enforced or entered any injunction, order, decree or ruling (whether temporary, preliminary or permanent) which has become final and nonappealable and has the effect of making consummation of the Business Combination illegal or otherwise preventing or prohibiting consummation of the Business Combination, including the Mergers;

 

   

any of the Business Combination Proposal or any other proposals the parties to the Business Combination Agreement deem necessary to effectuate the Business Combination fail to receive the requisite vote for approval at the special meeting or any adjournment thereof;

 

   

by Comera if (i) there is an occurrence of a breach of any representation, warranty, covenant or agreement on the part of OTR set forth in the Business Combination Agreement, or if any representation or warranty of OTR will have become untrue, in either case such that the conditions described in subsections (a) and (b) under the heading “The Business Combination — Conditions to Closing — Comera” would not be satisfied (a “Terminating OTR Breach”); provided that Comera has not waived such Terminating OTR Breach and Comera is not then in material breach of its representations, warranties, covenants or agreements in the Business Combination Agreement; provided, however, that, if such Terminating OTR Breach is curable by OTR, Comera may not terminate the Business Combination Agreement due to a Terminating OTR Breach for so long as OTR continues to exercise its reasonable efforts to cure such breach, unless such breach is not cured within thirty days after notice of such breach is provided by Comera to OTR; or (ii) the OTR board of directors shall have publicly withdrawn, modified or changed, in a manner that is adverse to Comera, its recommendation to its stockholders to approve the Business Combination Proposal or any other proposals the parties to the Business Combination Agreement deem necessary to effectuate the Business Combination; and

 

   

by OTR if (i) Comera has failed to deliver the Written Consent to OTR within two hours following the execution of the Business Combination Agreement (such Written Consent was delivered to OTR on January 31, 2022); or (ii) there is an occurrence of a breach of any representation, warranty, covenant or agreement on the part of Comera, Holdco or the Merger Subs set forth in the Business Combination Agreement, or if any representation or warranty of Comera, Holdco or the Merger Subs has become untrue, in either case such that the conditions described in subsections (a) and (b) under the heading “The Business Combination — Conditions to Closing — Comera — OTR” would not be satisfied (“Terminating Comera Breach”); provided, that OTR has not waived such Terminating Comera Breach and OTR is not then in material breach of their representations, warranties, covenants or agreements in the Business Combination Agreement; provided, further, that, if such Terminating Comera Breach is curable by Comera, Holdco or the Merger Subs, OTR may not terminate the Business Combination Agreement due to a Terminating Comera Breach for so long as Comera, Holdco or the Merger Subs continues to exercise its reasonable efforts to cure such breach, unless such breach is not cured within thirty (30) days after notice of such breach is provided by OTR to Comera;

 

   

the PCAOB Audited Financials have not been delivered to OTR by Comera on or before February 25, 2022; or

 

   

by Comera if the OTR Board of Directors shall have publicly withdrawn, modified or changed, in a manner that is adverse to Comera, its recommendation to the OTR Stockholders to approve the Business Combination Proposal or any of the proposals being considered at the special meeting.

If the Business Combination Agreement is terminated, the Business Combination Agreement will become void, and there will be no liability under the Business Combination Agreement on the part of any party thereto, except as set forth in the Business Combination Agreement or in the case of termination subsequent to a willful material breach of the Business Combination Agreement by a party thereto.

For more information, see the section entitled “The Business Combination Agreement — Termination.”

 

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Certain Agreements Related to the Business Combination Agreement

Stockholder Support Agreement

On January 31, 2022, OTR, Holdco, Comera and the Key Comera Stockholders entered into the Stockholder Support Agreement, pursuant to which the Key Comera Stockholders agreed to vote all of their shares of Comera Common Stock and Comera Preferred Stock in favor of the approval and adoption of the Business Combination Agreement and the Business Combination. Additionally, the Key Comera Stockholders have agreed not to (a) transfer any of their shares of Comera Common Stock and Comera Preferred Stock (or enter into any arrangement with respect thereto), (b) enter into any voting arrangement that is inconsistent with the Stockholder Support Agreement or (c) trade in shares of OTR until the expiration of the redemption rights pursuant to OTR’s amended and restated certificate of incorporation. For more information about the Stockholder Support Agreement, see the section entitled “Certain Agreements Related to the Business Combination — Stockholder Support Agreement.”

Sponsor Support Agreement

On January 31, 2022, the Sponsor, Comera and OTR entered into the Sponsor Support Agreement, pursuant to which the Sponsor agreed, among other things to (a) vote all of its shares of OTR Class B Common Stock in favor of the Business Combination Agreement and the Business Combination, (b) abstain from exercising any redemption rights in connection with the Business Combination and (c) waive the anti-dilution provisions of Section 4.3(b)(ii) of OTR’s amended and restated certificate of incorporation, which contains adjustments to the conversion ratio of the shares of OTR Class B Common Stock into shares of OTR Class A Common Stock at Closing.

Registration Rights and Lock-Up Agreement

In connection with the Business Combination, OTR, Holdco, all stockholders of Comera (the “Comera Holders”) and the Sponsor (together with the Comera Holders, the “Holders”) will enter into the Registration Rights and Lock-Up Agreement at Closing.

Pursuant to the terms of the Registration Rights and Lock-Up Agreement, Holdco will be obligated to file a registration statement to register the resale of certain securities of Holdco held by certain Holders. In addition, subject to certain requirements and customary conditions, including with regard to the number of demand rights that may be exercised, certain Holders may demand at any time or from time to time, to sell all or any portion of their registrable securities in an underwritten offering so long as the total offering price is reasonably expected to exceed $30 million. The Registration Rights and Lock-Up Agreement will also provide certain Holders with “piggy-back” registration rights, subject to certain requirements and customary conditions.

Subject to certain exceptions, the Registration Rights and Lock-Up Agreement further provides for the securities of Holdco held by the Holders to be locked-up until the earlier of (i) one year following the Closing and (ii) the date on which the sale price of the Holdco Common Stock equals or exceeds $12.00 per share for any 20 trading days within any 30-day trading period commencing 150 days after the Closing (the “Lock-Up Period”). Notwithstanding the Lock-Up Period, in the event that $25 million or more remains in the Trust Account, for any Comera Holders owning less than 4% of the outstanding shares of Holdco Common Stock as of immediately after the Closing, with respect to 50% of the shares of Holdco Common Stock owned by such Holder immediately following the Closing, the Lock-Up Period will end on the date that is 180 days after the Closing.

For more information about the Registration Rights and Lock-Up Agreement, see the section entitled “Certain Agreements Related to the Business Combination — Registration Rights and Lock-Up Agreement.”

 

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Letter Agreement

In connection with the Closing, Holdco and Sponsor will enter into the Letter Agreement to provide for certain governance matters relating to the Combined Company. The Business Combination Agreement and the form of Letter Agreement attached thereto provide that, among other things, so long as Sponsor’s director nominee remains on the board of directors of the Combined Company, Sponsor will be entitled to designate a representative to attend meetings of the board of directors of the Combined Company in a nonvoting observer capacity.

For more information about the Letter Agreement, see the section entitled “Certain Agreements Related to the Business Combination — Letter Agreement.”

Engagement Letter between Comera and Maxim Group LLC

Pursuant to an amended letter agreement between Comera and Maxim, Comera will pay a success fee to Maxim at the closing of the Business Combination equal to 3.75% of the $118.5 million enterprise value ascribed to Comera for purposes of calculating the number of shares of Holdco Common Stock to be issued to Comera stockholders in the Business Combination. Based on a negotiated enterprise value of $118.5 million enterprise value, Maxim will be entitled to a success fee of $4,443,750, of which $1,000,000 will be paid in cash and $3,443,750 will be paid shares of Holdco Common Stock at the closing of the Business Combination. Maxim will also be due a success fee on any consideration Comera receives from the Earn Out, if and when it is received, payable in shares of Holdco Common Stock.

Reasons for the Approval of the Business Combination

After careful consideration, OTR’s board of directors recommends that OTR stockholders vote “FOR” each OTR Proposal being submitted to a vote of the OTR stockholders at the OTR special meeting of stockholders.

For a description of OTR’s reasons for the approval of the Business Combination and the recommendation of our board of directors, see the section entitled “The Business Combination — OTR’s Board of Directors’ Reasons for the Approval of the Business Combination.”

Ownership of Holdco After the Closing

It is anticipated that, upon the completion of the Business Combination, the ownership of Holdco will be as follows:

 

   

current Comera Stockholders will own 15,750,000 shares of Holdco Common Stock, representing approximately 54.3% of the total shares outstanding;

 

   

the Public Stockholders will own 10,630,179 shares of Holdco Common Stock, representing approximately 36.7% of the total shares outstanding; and

 

   

the Sponsor will own 2,611,838 shares of Holdco Common Stock, representing approximately 9.0% of the total shares outstanding.

The numbers of shares and percentage interests set forth above are based on a number of assumptions, including that there are no redemptions of OTR Common Stock, that Comera does not issue any additional equity securities prior to the Mergers and the Earn-Out Trigger is achieved during the Earn-Out Period and the Earn-Out Shares are all released from escrow to the Comera stockholders. If the actual facts differ from our assumptions, the numbers of shares and percentage interests set forth above will be different. In addition, the numbers of shares and percentage interests set forth above do not take into account (i) potential future exercises of OTR Warrants or (ii) shares issuable upon the exercise of outstanding Comera Unvested Options and Comera Vested Out-of-the-Money Options.

 

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Organizational Structure

The following diagram illustrates the transaction structure of the Business Combination and the organizational structure of the parties thereto prior to the Closing.

 

 

LOGO

The following diagram illustrates the organizational structure of Holdco upon consummation of the Business Combination.

 

 

LOGO

Recommendation of the OTR Board of Directors

The OTR board of directors has unanimously determined that the Business Combination, on the terms and conditions set forth in the Business Combination Agreement, is advisable and in the best interests of OTR and its stockholders and has directed that the proposals set forth in this proxy statement/prospectus be submitted to its stockholders for approval at the special meeting on the date and at the time and place set forth in this proxy statement/prospectus. The OTR board of directors unanimously recommends that OTR’s stockholders vote “FOR” the Business Combination Proposal, “FOR” the Charter Amendment Proposal, “FOR” the Equity Incentive Award Plan Proposal and “FOR” the Adjournment Proposal, if presented. See “The Business

 

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Combination — Recommendation of the OTR Board of Directors” and “The Business Combination — OTR’s Board of Directors’ Reasons for the Approval of the Business Combination.”

Recommendation of the Comera Board of Directors

After consideration, the Comera Board of Directors unanimously approved and declared that the Business Combination Agreement and the Business Combination are advisable and in the best interests of Comera and the Comera Stockholders. See the section entitled “The Business Combination – Interests of Comera’s Directors and Executive Officers in the Business Combination” beginning on page 128.

OTR’s Special Meeting of Stockholders

See “Questions and Answers About the Special Meeting of OTR’s Stockholders and the Related Proposals” above and “The Special Meeting of OTR Stockholders” below for information regarding the special meeting.

The Sponsor and OTR’s Directors and Officers Have Financial Interests in the Business Combination

See “Questions and Answers About the Special Meeting of OTR’s Stockholders and the Related Proposals” above for information regarding the Sponsor and OTR’s directors’ and officers’ financial interests in the Business Combination.

Comera’s Directors and Officers Have Financial Interests in the Business Combination

Certain of Comera’s executive officers and directors may have interests in the Business Combination that may be different from, or in addition to, the interests of Comera’s stockholders. The members of the Comera Board of Directors were aware of and considered these interests to the extent that such interests existed at the time, among other matters, when they approved the Business Combination Agreement and recommended that Comera’s stockholders approve the Comera Business Combination Proposal. See “The Business Combination — Interests of Comera’s Directors and Executive Officers in the Business Combination” beginning on page 128.

 

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Summary Risk Factors

You should consider all the information contained in this proxy statement/prospectus in deciding how to vote for the proposals presented in this proxy statement/prospectus. In particular, you should consider the risk factors described under “Risk Factors” beginning on page 40. Such risks include, but are not limited to:

 

   

Comera does not currently have, and may never have, any products approved for commercial sale and may never become profitable.

 

   

Comera’s success depends on its ability to respond and adapt to changes in the drug development industry, including payer, medical practice, medical provider and prescriber behavior.

 

   

Even after the Business Combination Comera will require substantial additional funding to finance its operations. If Comera is unable to raise additional capital when needed, Comera could be forced to delay, reduce or terminate certain of its development programs or other operations.

 

   

Comera has never successfully completed the regulatory approval process for any of its product candidates and it may be unable to do so for any product candidates it acquires or develops.

 

   

Drug development is a lengthy, expensive and uncertain process. The results of preclinical studies and clinical trials are not always predictive of future results. If Comera’s preclinical studies and clinical trials are not sufficient to support regulatory approval of any of its product candidates, Comera may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development of such product candidate.

 

   

Comera’s current or future product candidates may cause adverse or other undesirable side effects or have other properties that could delay or prevent their regulatory approval, limit the commercial profile of an approved label or result in significant negative consequences following regulatory approval, if obtained.

 

   

Comera may experience fluctuations in its operating results, which could make its future operating results difficult to predict or cause its operating results to fall below analysts’ and investors’ expectations.

 

   

Comera’s success depends on broad market acceptance of its products if approved, which Comera may never achieve.

 

   

The COVID-19 pandemic, or a similar pandemic, epidemic, or outbreak of an infectious disease, may materially and adversely affect Comera’s business and its financial results and could cause a disruption to the development of its product candidates.

 

   

Comera’s success depends on its ability to retain key members of its management team and on its ability to hire, train, retain and motivate new employees.

 

   

If Holdco fails to maintain an effective system of internal control over financial reporting, it may not be able to accurately report its financial results or prevent fraud. As a result, stockholders could lose confidence in its financial and other public reporting, which would harm its business and the trading price of Holdco Common Stock.

 

   

Comera is currently party to several in-license agreements under which it acquired rights to use, develop, manufacture and/or commercialize certain of its product candidates, and expects to enter additional collaborations in the future. If these collaborations are not successful, Comera’s business could be adversely affected.

 

   

Comera may seek to establish additional collaborations, and, if it is not able to establish them on commercially reasonable terms, or at all, Comera may have to alter its development and commercialization plans.

 

   

Comera may be required to pay certain milestones and royalties under its license or collaboration agreements with third-party licensors or collaborators.

 

   

Comera may rely on third parties to conduct its future clinical trials of its product candidates, in the U.S. and other jurisdictions. If these third parties do not successfully carry out their contractual duties, comply with regulatory requirements or meet expected deadlines, Comera may not be able to obtain regulatory approval for or commercialize its product candidates and its business could be substantially harmed.

 

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Comera contracts with third parties for the manufacture of its product candidates for preclinical development, clinical testing, and expect to continue to do so for commercialization. This reliance on third parties increases the risk that Comera will not have sufficient quantities of its product candidates or products or such quantities at an acceptable cost, which could delay, prevent or impair its development or commercialization efforts.

 

   

The manufacture of biologics is complex and Comera’s third-party manufacturers may encounter difficulties in production. If any of Comera’s third-party manufacturers encounter such difficulties, Comera’s ability to provide a supply of its current product candidates or any future product candidates for clinical trials or its products for patients, if approved, could be delayed or prevented.

 

   

The third parties upon whom Comera relies for the supply of the active pharmaceutical ingredients and drug product to be used in the preclinical testing and clinical trials for its product candidates are currently its sole source of supply, and the loss of any of these suppliers could significantly harm Comera’s business.

 

   

If Comera is unable to obtain and maintain patent and other intellectual property protection for its technology and product candidates or if the scope of the intellectual property protection obtained is not sufficiently broad or Comera is delayed in bringing product candidates to market such that those products have a shorter period of patent exclusivity than it expects, its competitors could develop and commercialize technology and drugs similar or identical to Comera’s, and Comera’s ability to successfully commercialize its technology and drugs may be impaired.

 

   

Intellectual property litigation and administrative patent office patent validity challenges in one or more countries could cause Comera to spend substantial resources and distract its personnel from their normal responsibilities.

 

   

Comera may seek priority review designation for one or more of its product candidates, but it might not receive such designation, and even if it does, such designation may not lead to a faster regulatory review or approval process.

 

   

Accelerated approval by the FDA, even if granted for any of Comera’s product candidates, may not lead to a faster development or regulatory review or approval process and it does not increase the likelihood that Comera’s product candidates will receive regulatory approval.

 

   

Even if Comera receives regulatory approval for any of its product candidates, it will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense. Additionally, Comera’s product candidates, if approved, could be subject to post-market study requirements, marketing and labeling restrictions, and even recall or market withdrawal if unanticipated safety issues are discovered following approval. In addition, Comera may be subject to penalties or other enforcement action if it fails to comply with regulatory requirements.

 

   

Holdco’s management has limited experience in operating a public company.

 

   

There may be sales of a substantial amount of Holdco Common Stock after the Business Combination by the current OTR Stockholders and/or Comera Stockholders, and these sales could cause the price of Holdco’s securities to fall.

 

   

Holdco may fail to realize the strategic and financial benefits currently anticipated from the Business Combination.

 

   

The ability of Public Stockholders to exercise redemption rights with respect to a large number of their Public Shares could deplete the Trust Account prior to the Business Combination and thereby diminish the amount of working capital of Holdco after the consummation of the Business Combination.

 

   

OTR’s Sponsor, executive officers and directors have potential conflicts of interest in recommending that stockholders vote in favor of approval of the Business Combination Proposal and approval of the other proposals described in this proxy statement/prospectus.

 

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SELECTED HISTORICAL FINANCIAL INFORMATION OF COMERA

The selected historical statements of operations and cash flow data of Comera for the years ended December 31, 2021 and 2020, and the historical balance sheet data as of December 31, 2021 and 2020 are derived from Comera’s audited financial statements included elsewhere in this proxy statement/prospectus.

Comera’s historical results are not necessarily indicative of the results that may be expected in the future. The information below is only a summary and should be read in conjunction with the section entitled “Comera Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the Comera financial statements, and the notes and schedules related thereto, which are included elsewhere in this proxy statement/prospectus.

 

     As of and
for the
year ended
December 31,
2021
     As of and
for the
year ended
December 31,
2020
 

Statement of Operations Data:

     

Revenue

   $                    $ 442,919  
  

 

 

    

 

 

 

Gross profit

   $        $ 338,512  
  

 

 

    

 

 

 

Total operating expenses

   $        $ 2,466,032  
  

 

 

    

 

 

 

Loss from operations

        (2,127,520

Other income, net

        2,033  
  

 

 

    

 

 

 

Net loss and comprehensive loss

   $        $ (2,125,487
  

 

 

    

 

 

 

Net loss per share or unit — basic and diluted

   $        $ (0.19
  

 

 

    

 

 

 

Statement of Cash Flow Data:

     

Net cash used in operating activities

   $        $ (1,804,104

Net cash used in investing activities

        (12,366

Net cash provided by financing activities

        1,552,330  

Balance Sheet Data:

     

Total assets

   $        $ 545,878  

Total liabilities

        393,963  

Total stockholders’ (deficit) and members’ equity

        151,915  

 

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SELECTED HISTORICAL FINANCIAL INFORMATION OF OTR

The selected historical statements of operations and cash flows data of OTR for the year ended December 31, 2021 and for the period from July 23, 2020 (inception) to December 31, 2020 and the historical balance sheet data as of December 31, 2021 and 2020 are derived from OTR’s audited financial statements included elsewhere in this proxy statement/prospectus.

OTR’s historical results are not necessarily indicative of the results that may be expected in the future. The information below is only a summary and should be read in conjunction with the section entitled “OTR Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the OTR financial statements, and the notes and schedules related thereto, which are included elsewhere in this proxy statement/prospectus.

 

     As of and
for the
year ended
December 31,
2021
     As of and for
the period from
July 23, 2020
(inception)
through
December 31,
2020
 

Statement of Operations Data:

     

Operating costs

   $                    $ 208,689  
  

 

 

    

 

 

 

Loss from operations

        (208,689

Other income (expense)

     

Interest income earned on marketable securities held in Trust Account

        9,155  

Change in fair value of derivative warrant liabilities

        (2,771,405

Offering costs associated with warrants recorded as liabilities

        (309,851
  

 

 

    

 

 

 

Net loss

   $        $ (3,280,790
  

 

 

    

 

 

 

Balance Sheet Data:

     

Total assets

   $        $ 108,419,421  

Total liabilities

        14,775,296  

Class A common stock; subject to possible redemption

        107,085,338  

Total stockholders’ deficit

        (13,441,213

 

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SELECTED UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2021 give pro forma effect to the Business Combination as if it had occurred on January 1, 2021. The unaudited pro forma condensed combined balance sheet as of December 31, 2021 gives pro forma effect to the Business Combination as if it was completed on December 31, 2021.

The unaudited pro forma condensed combined financial information is based on and should be read in conjunction with:

 

   

the accompanying notes to the unaudited pro forma condensed combined financial information;

 

   

the historical financial statements of OTR as of and for the year ended December 31, 2021, and the related notes, included elsewhere in this proxy statement/prospectus;

 

   

the historical financial statements of Comera as of and for the year ended December 31, 2021, and the related notes, included elsewhere in this proxy statement/prospectus; and

 

   

other information relating to OTR and Comera included in this proxy statement/prospectus, including the Business Combination Agreement and the description of certain terms thereof set forth under “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement”, as well as the disclosures contained in the sections titled “OTR Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Comera Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

The unaudited pro forma condensed combined financial information has been prepared using two alternative levels of redemption of shares of OTR Class A Common Stock into cash:

 

   

Scenario 1 — No redemption: This presentation applies the assumption that no Public Stockholders exercise redemption rights with respect to their redeemable OTR Class A Common Stock upon consummation of the Business Combination; and

 

   

Scenario 2 — Maximum redemptions of OTR Class A Common Stock: This presentation assumes that Public Stockholders holding approximately 10,447,350 shares of redeemable OTR Class A Common Stock will exercise their redemption rights upon consummation of the Business Combination at a redemption price of approximately $10.25 per share, which is the maximum amount of redemptions that could occur and still ensure that OTR meets its requirement to maintain net tangible assets of at least $5,000,001.

 

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING

STATEMENTS

Holdco, OTR and Comera believe that some of the information in this proxy statement/prospectus constitutes forward-looking statements for the purposes of federal securities laws. You can identify these statements by forward-looking words such as “may,” “might,” “could,” “will,” “would,” “should,” “expect,” “possible,” “potential,” “anticipate,” “contemplate,” “believe,” “estimate,” “plan,” “predict,” “project,” “intends,” and “continue” or similar words, but the absence of these words does not mean that a statement is not forward-looking. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward-looking statements in this proxy statement/prospectus may include, for example, statements about:

 

   

the parties’ to consummate the Business Combination;

 

   

the expected benefits of the Business Combination;

 

   

Holdco’s financial and business performance following the Business Combination, including financial projections and business metrics;

 

   

changes in Holdco’s strategy, future operations, financial position, estimated revenues and losses, forecasts, projected costs, prospects and plans;

 

   

the implementation, market acceptance and success of Comera’s business models;

 

   

the impact of health epidemics, including the COVID-19 pandemic, on Comera’s business and industry and the actions Comera may take in response thereto;

 

   

Comera’s expectations regarding its ability to obtain and maintain intellectual property protection and not infringe on the rights of others;

 

   

expectations regarding the time during which we will be an emerging growth company under the JOBS Act;

 

   

Comera’s future capital requirements and sources and uses of cash;

 

   

Comera’s ability to obtain funding for its operations;

 

   

Comera’s business, expansion plans and opportunities;

 

   

expected capital expenditures, cost of revenue and other future expenses, and the sources of funds to satisfy the liquidity needs of the Combined Company;

 

   

the expected U.S. federal income tax impact of the Business Combination; and

 

   

the outcome of any known and unknown litigation and regulatory proceedings.

These forward-looking statements are based on information available as of the date of this proxy statement/prospectus, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

You should not place undue reliance on these forward-looking statements in deciding how to vote your proxy or instruct how your vote should be cast on the proposals set forth in this proxy statement/prospectus. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:

 

   

the risk that the Business Combination may not be completed in a timely manner or at all, which may adversely affect the price of Holdco’s securities;

 

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the risk that the Business Combination may not be completed by OTR’s business combination deadline and the potential failure to obtain an extension of the business combination deadline if sought by OTR;

 

   

the failure to satisfy the conditions to the consummation of the Business Combination, including the adoption of the Business Combination Agreement by the stockholders of OTR and Comera and the receipt of certain governmental and regulatory approvals;

 

   

the lack of a third party valuation in determining whether to pursue the Business Combination;

 

   

the occurrence of any event, change or other circumstance that could give rise to the termination of the Business Combination Agreement;

 

   

the effect of the announcement or pendency of the Business Combination on Comera’s business relationships, performance, and business generally;

 

   

risks that the Business Combination disrupts Comera’s current plans and potential difficulties in Comera’s employee retention as a result of the Business Combination;

 

   

the outcome of any legal proceedings that may be instituted against Comera or against OTR related to the Business Combination Agreement or the Business Combination;

 

   

Holdco’s ability to satisfy the listing criteria of the Nasdaq and to maintain the listing of its securities on the Nasdaq following the Business Combination;

 

   

the effect of the COVID-19 pandemic on Comera’s business;

 

   

the outcome of any legal proceedings that may be instituted against OTR, Comera or Holdco following the announcement of the proposed Business Combination and transactions contemplated thereby;

 

   

costs related to the Business Combination;

 

   

the price of Holdco’s securities may be volatile due to a variety of factors, including changes in the competitive and highly regulated industries in which Comera plans to operate, variations in performance across competitors, changes in laws and regulations affecting Comera’s business and changes in the combined capital structure;

 

   

the ability to implement business plans, forecasts, and other expectations after the completion of the Business Combination, and identify and realize additional opportunities;

 

   

the risk of downturns and the possibility of rapid change in the highly competitive industry in which Comera operates;

 

   

the risk that Comera and its current and future collaborators are unable to successfully develop and commercialize Comera’s products or services, or experience significant delays in doing so;

 

   

the risk that Comera may never achieve or sustain profitability;

 

   

the risk that Comera will need to raise additional capital to execute its business plan, which may not be available on acceptable terms or at all;

 

   

the risk that Holdco experiences difficulties in managing its growth and expanding operations;

 

   

the risk that third-party suppliers and manufacturers are not able to fully and timely meet their obligations;

 

   

the risk that Comera is unable to secure or protect its intellectual property;

 

   

general economic conditions; and

 

   

other risks and uncertainties described in this proxy statement/prospectus, including those under the section entitled “Risk Factors.”

 

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RISK FACTORS

You should carefully review and consider the following risk factors and the other information contained in this proxy statement/prospectus, including the financial statements and notes to the financial statements included herein, in evaluating the Business Combination and the proposals to be voted on at the special meeting. Certain of the following risk factors apply to the business and operations of Comera and will also apply to the business and operations of Holdco following the completion of the Business Combination. The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may adversely affect the ability to complete or realize the anticipated benefits of the Business Combination, and may have a material adverse effect on the business, cash flows, financial condition and results of operations of Holdco following the Business Combination. The risks discussed below may not prove to be exhaustive and are based on certain assumptions made by OTR, Comera and Holdco that later may prove to be incorrect or incomplete. OTR, Comera and Holdco may face additional risks and uncertainties that are not presently known to such entity, or that are currently deemed immaterial, which may also impair the business or financial condition of Holdco. Unless the context requires otherwise, references to “Comera” in this section are to the business and operations of Comera prior to the Business Combination and the business and operations of Holdco as directly or indirectly affected by Comera by virtue of Holdco’s ownership of the business of Comera following the Business Combination. In addition, you should read and consider the risks associated with the business of OTR because these risks may also affect the Combined Company — these risks can be found in OTR’s Annual Report on Form 10-K, as updated by subsequent Quarterly Reports on Form 10-Q, if any, all of which are filed with the SEC. Please see the section entitled “Where You Can Find More Information” in this proxy statement/prospectus.

Risks Related to Comera’s Financial Status, Business Model and Growth Plans

Unless the context otherwise requires, all references in this “Risks Related to Comera’s Financial Status, Business Model and Growth Plans” section to “we,” “us,” “our,” or the “Company” refer to Comera Life Sciences, Inc. prior to the consummation of the Business Combination.

We do not currently have, and may never have, any products approved for commercial sale and may never become profitable.

To become profitable and grow our revenue, we must develop and eventually commercialize a product or products with significant market potential. This will require us to be successful in a range of challenging activities, including establishing our business model and key third-party relationships with payers, completing preclinical studies and clinical trials of our product candidates, obtaining marketing approval for these product candidates, manufacturing, marketing, selling those products for which we may obtain marketing approval and satisfying any post-marketing requirements.

We currently do not have any products approved for commercial sale and cannot guarantee that we will ever receive necessary regulatory approvals to commercialize any products. Our ability to become profitable depends upon our ability to generate revenue from services and product sales or execute other business arrangements. Our current product candidates are in various early stages of development and we do not expect to generate any revenue from the sale of approved products in the near future. We do not expect to generate significant additional revenue unless and until we obtain regulatory approval of, and begin to sell, one or more of our products, if approved. Our ability to generate revenue depends on a number of factors, including, but not limited to, our ability to:

 

   

successfully complete internal preclinical validation of our pipeline programs and their respective product candidates;

 

   

obtain rights from third parties to utilize third party cell lines or to develop these internally;

 

   

successfully complete our ongoing and planned preclinical and clinical studies for our pipeline programs;

 

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timely file and gain acceptance of investigational new drug applications for our programs in order to commence planned clinical trials or future clinical trials;

 

   

successfully enroll subjects in, and complete, our ongoing and planned clinical trials;

 

   

obtain data and other development support from our third-party contractors and collaborators;

 

   

initiate and successfully complete all safety and efficacy studies required to obtain U.S. and foreign regulatory approval for our product candidates, and additional clinical trials or other studies beyond those planned to support the approval and commercialization of our product candidates;

 

   

successfully demonstrate to the satisfaction of the U.S. Food and Drug Administration (“FDA”), the European Medicines Agency (“EMA”), or similar foreign regulatory authorities the safety, efficacy, purity and potency, and acceptable risk to benefit profile of our product candidates or any future product candidates;

 

   

successfully manage the prevalence, duration and severity of potential side effects or other safety issues experienced with our product candidates, if any;

 

   

obtain the timely receipt of necessary marketing approvals from the FDA, EMA and similar foreign regulatory authorities;

 

   

establish commercial manufacturing capabilities or make arrangements with third-party manufacturers for clinical supply and commercial manufacturing;

 

   

obtain and maintain patent and trade secret protection or regulatory exclusivity for our product candidates;

 

   

launch commercial sales of our products, if and when approved, whether alone or in collaboration with others;

 

   

obtain and maintain acceptance of the products, if and when approved, by patients, the medical community and third-party payers;

 

   

position our product candidates to effectively compete with other therapies;

 

   

obtain and maintain healthcare coverage and adequate reimbursement for our products;

 

   

hire additional clinical, regulatory and scientific personnel;

 

   

enforce and defend intellectual property rights and claims; and

 

   

maintain a continued acceptable safety profile of our products following approval.

Due to the uncertainties and risks associated with these activities, we are unable to accurately and precisely predict the timing and amount of revenues, or the extent of any losses. We may never succeed in these activities and, even if we succeed in commercializing one or more of our product candidates, we may never generate revenue that is significant enough to achieve profitability on any product candidate. If we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis and we will continue to incur substantial research and development and other expenditures to develop and market additional product candidates. Our failure in any of the above activities could jeopardize our revenue growth and profitability and could decrease the value of our securities and impair our ability to raise capital, maintain our research and development efforts, expand our business or continue our operations.

Our business model is untested and may never be successful or generate sufficient growth to sustain profitability.

We are building a pipeline of innovative new biologic product candidates to transform essential biologic medicines from intravenous to subcutaneous forms, or to produce improved versions of current subcutaneous

 

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biologics. Leveraging our proprietary SQore technology platform and excipient library of over 200 compounds — all well-established biological products, most with known toxicology profiles — we intend to continue partnering with biopharmaceutical companies to develop their assets into new or improved subcutaneous formulations while advancing our own novel pipeline programs. We are also positioned to be able to develop biosimilar versions of currently approved products. However, each aspect our business model is untested in the biopharmaceutical industry, and any of the assumptions underlying our expectations may be incorrect. There can be no assurance that our assumptions are correct or that, if correct, our strategy will succeed.

Our business model may never be successful or generate sufficient growth to sustain profitability. Our competitors or new market entrants may adopt similar or otherwise more favorable products and strategies, leading to significant price competition and/or reducing or eliminating our competitive advantage, each of which could adversely affect our revenues.

Our business model requires us to scale our pipeline through drug engineering collaborations, in-licensing or otherwise acquiring additional product candidates, and developing such product candidates, which we may be unable to successfully achieve or maintain.

Our business model requires us to scale through the development or acquisition of many additional product candidates, which we may be unable to achieve or maintain. Our business model requires that we continually review, evaluate and consider potential development and acquisitions of additional product candidates. In such evaluations, we will be required to make difficult judgments regarding the potential value of such additional product candidates. We may not be successful in identifying attractive opportunities. Even if we are successful in identifying attractive opportunities, we may not successfully execute development or acquisition of such opportunities on terms acceptable to us. We may also experience increased competition for attractive assets from other pharmaceutical companies, many of which have significantly more resources than we do. We may also experience additional challenges in the acquisition of certain assets, including but not limited to geopolitical considerations when acquiring assets form outside the United States.

Even if we are successful in acquiring additional product candidates, we may not successfully integrate them into our existing operations or derive the anticipated benefits of such acquisitions, which may result in the investment of our capital resources without realizing the expected returns on such investments. Given our limited resources, we may also forego acquisition of product candidates that later prove to have greater commercial potential. Product candidates that we acquire will also be subject to the risks and uncertainties associated with developing product candidates. The time and effort involved in attempting to identify acquisition candidates and consummate acquisitions may also divert the attention of members of our management from the operations of our company.

In addition, we may not be successful in our efforts to identify, engineer, or develop additional product candidates in the future either internally or through our current or future collaboration partners. Research programs to identify new product candidates require substantial technical, financial and human resources. Product candidates that we develop internally through our own efforts or with our partners may be more expensive to discover, develop or manufacture than we expect, which could require us to adjust our pricing model, or de-emphasize internal development efforts in the near or long-term. Our research programs may initially show promise in identifying potential product candidates, yet fail to yield product candidates for clinical development for a number of reasons, including our inability to design such product candidates with the properties that we desire. Potential product candidates may, on further study, be shown to have harmful side effects or other characteristics that indicate that they are unlikely to be products that will receive marketing approval and achieve market acceptance. We may also be limited in our ability to pursue multiple indications with one product, due to financial or other resource constraints, development issues or regulatory obstacles. Even if we are able to pursue multiple indications, we may not be able to do so as quickly or successfully as our competitors, which may impact our ability to gain market acceptance across multiple indications for any one product. If we are unable to identify suitable additional candidates for development or acquisition, our opportunities to successfully develop and commercialize therapeutic products will be limited.

 

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Failure to manage our growth effectively could cause our business to suffer and have an adverse effect on our ability to execute our business strategy, as well as operating results and financial condition.

As of December 31, 2021, we had ten full-time, one part-time and two subcontracted employees. As we continue development of our product candidates, as well as function as a public company, we will need to expand our financial, development, regulatory, manufacturing, commercial and other capabilities or contract with third parties to provide these capabilities for us. As our operations expand, we expect that we will need to manage additional relationships with various collaborators, suppliers, and other third parties. Future growth will impose significant added responsibilities on members of our management. Our management may have to divert a disproportionate amount of its attention away from our day-to-day activities and devote a substantial amount of time to these growth activities, including identifying, recruiting, integrating, maintaining, and motivating additional employees, managing our research and development efforts effectively, including the clinical trials and the FDA’s or comparable foreign regulatory authorities’ review process for our product candidates, while complying with our contractual obligations to contractors and other third parties and improving our operational, financial and management controls, reporting systems and procedures. Our future financial performance and our ability to develop and commercialize our product candidates and to compete effectively will depend, in part, on our ability to manage any future growth effectively. We may not be able to accomplish these tasks, and our failure to accomplish any of them could prevent us from successfully growing our company or could disrupt our operations.

Our success depends on our ability to respond and adapt to changes in the drug development industry, including payer, medical practice, medical provider and prescriber behavior. We may be unsuccessful in achieving acceptance or changing prescribing or purchasing habits of healthcare system participants.

Our success and future growth largely depend on our ability to increase awareness of our offerings, and on the willingness of healthcare system participants to purchase our products, if approved, for the treatment of patients. To effectively market our products, we must educate healthcare system participants about the benefits of our offerings. We cannot assure you that we will be successful in changing prescribing or purchasing habits of healthcare system participants or that we will achieve broad market education or awareness among healthcare system participants. Even if we are able to raise awareness among healthcare system participants, they may be slow in changing their habits and may be hesitant to use our products for a variety of reasons, including but not limited to:

 

   

lack of experience with our company, products, and concerns that we are relatively new to the industry;

 

   

perceived health, safety or quality risks associated with the use of new products;

 

   

competition and negative selling efforts from competitors, including competing offerings and price matching programs;

 

   

concerns that our product candidates are not as safe or effective as first-to-market medicines, including because clinical development of our product candidates in some cases will have been performed by third parties; and

 

   

pre-existing or intractable prescribing habits among doctors or guidelines among payers that limit products like ours from gaining market share.

If we are unsuccessful in changing prescribing or purchasing habits of healthcare system participants, our business, financial condition and results of operations would be adversely affected.

We may be unable to continue to attract and retain third-party collaborators, including collaboration partners and licensors, or may fail to do so in an effective manner. Our collaborations with third-party collaborators are also subject to certain risks.

Our success depends in part on our ability to effectively attract third-party collaborators and retain our existing collaborators, across several strategic areas, including acquiring additional product candidates, and conducting research collaborations. We have made significant investments related to attracting, acquiring and

 

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retaining third-party collaborators but cannot assure you that our efforts will be effective or that benefits realized from our partnerships with any new third-party collaborators will ultimately exceed the costs incurred in attracting, acquiring or retaining such collaborators. If we are unable to attract or retain third-party collaborators, our business, financial condition and results of operations would be adversely affected.

Our collaborations with third-party business collaborators are also subject to a number of risks, including but not limited to:

 

   

adverse decisions by a third party regarding the amount and timing of resource expenditures for the development and commercialization of product candidates;

 

   

possible disagreements as to the timing, nature and extent of development plans, including clinical trials or regulatory approval strategy;

 

   

delays or non-performance by our collaborators in performance of their contractual obligations, including delivery of data to us;

 

   

lack of alignment between specifications for products and specifications that have or might be approved by regulatory authorities;

 

   

the right of a third-party business collaborator to terminate its agreement with us on limited notice upon the occurrence of certain defined events;

 

   

loss of significant rights if we fail to meet our obligations under a collaboration agreement;

 

   

withdrawal of support by a third-party business collaborator following change of that collaborator’s corporate strategy or due to competing priorities;

 

   

changes in key management personnel at a third-party business collaborator that are members of the collaboration’s various operating committees; and

 

   

possible disagreements with a third-party business collaborator regarding a collaboration agreement or ownership of proprietary rights, including with respect to inventions discovered under the applicable collaboration agreement.

Due to these factors and other possible disagreements with a third-party collaborator, including potential disputes over intellectual property ownership or timely access to clinical data, we may be delayed or prevented from developing, manufacturing or commercializing product candidates or we may become involved in litigation or arbitration, which would be time consuming and expensive.

For additional information regarding the risks that may apply to our relationships with third parties, see the section entitled “— Risks Related to Our Strategic Agreements and Relationships with Third Parties” appearing elsewhere.

We may consider strategic alternatives in order to maximize stockholder value, including financings, strategic alliances, licensing arrangements, acquisitions or the possible sale of our business. We may not be able to identify or consummate any suitable strategic alternatives and any consummated strategic alternatives may have an adverse impact on our product candidates.

We may consider all strategic alternatives that may be available to us to maximize stockholder value, including financings, strategic alliances, licensing arrangements, acquisitions or the possible sale of our business. We currently have no agreements or commitments to engage in any specific strategic transactions, and our exploration of various strategic alternatives may not result in any specific action or transaction. If we do engage in a strategic transaction, our business objectives may change depending upon the nature of the transaction. Furthermore, if we determine to engage in a strategic transaction, we cannot predict the impact that such strategic transaction might have on our operations or the prices of our securities. We also cannot predict the impact on securities prices if we fail to enter into a transaction.

 

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In addition, we face significant competition in seeking appropriate strategic partners, and the negotiation process is expensive and time-consuming. Moreover, we may not be successful in our efforts to establish a strategic partnership or other alternative arrangements for our product candidates because they may be deemed to be at too early of a stage of development for collaborative effort, third parties may not view our product candidates as having sufficient potential, or for other reasons. Any delays in entering into a strategic partnership related to our product candidates could delay the development and commercialization of our product candidates, which would harm our business prospects, financial condition and results of operations.

Risks Related to Comera’s Financial Position, Capital Requirements and Limited Operating History

Unless the context otherwise requires, all references in this “Risks Related to Comera’s Financial Position, Capital Requirements and Limited Operating History” section to “we,” “us,” “our,” or the “Company” refer to Comera Life Sciences, Inc. prior to the consummation of the Business Combination.

Even after the Business Combination we will require substantial additional funding to finance our operations. If we are unable to raise additional capital when needed, we could be forced to delay, reduce or terminate certain of our development programs or other operations.

As of December 31, 2021, we had cash and cash equivalents of $6.5 million. We believe that we will need to raise substantial additional capital to fund our continuing operations and the development and commercialization of our current product candidates and future product candidates. Our business or operating plan may change as a result of many factors currently unknown to us, and we may need to seek additional funds sooner than planned. We will need to raise additional capital before we can progress any of our product candidates into a pivotal clinical trial. We expect to finance our subsequent cash needs through public or private equity or debt financings, third-party (including government) funding and marketing and distribution arrangements, as well as other collaborations, strategic alliances and licensing arrangements or any combination of these approaches. In addition, we may need to accelerate the growth of our sales capabilities and distribution beyond what is currently envisioned, and this would require additional capital.

However, we may not be able to secure funding when we need it or on favorable terms and we may not be able to raise sufficient funds to commercialize our current and future product candidates we intend to develop. Our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to and volatility in the credit and financial markets in the United States and worldwide, including the trading price of common stock, resulting from the ongoing COVID-19 pandemic. Our future capital requirements will depend on many factors, including:

 

   

the timing, scope, progress, results and costs of research and development, testing, screening, manufacturing, preclinical development and clinical trials;

 

   

the outcome, timing and cost of seeking and obtaining regulatory approvals from the FDA and comparable foreign regulatory authorities, including the potential for such authorities to require that we perform field efficacy studies for our product candidates, require more studies than those that we currently expect or change their requirements regarding the data required to support a marketing application;

 

   

the costs of future commercialization activities, including product manufacturing, marketing, sales, royalties and distribution, for any of our product candidates for which we receive marketing approval;

 

   

our ability to maintain existing, and establish new, strategic collaborations, licensing or other arrangements and the financial terms of any such agreements, including the timing and amount of any future milestone, royalty or other payments due under any such agreement;

 

   

any product liability or other lawsuits related to our products;

 

   

the expenses needed to attract, hire and retain skilled personnel;

 

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the revenue, if any, received from commercial sales, or sales to foreign governments, of our product candidates for which we may receive marketing approval;

 

   

the costs to establish, maintain, expand, enforce and defend the scope of our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with licensing, preparing, filing, prosecuting, defending and enforcing of any patents or other intellectual property rights;

 

   

the costs of operating as a public company; and

 

   

the impact of the COVID-19 pandemic, which may exacerbate the magnitude of the factors discussed above.

Our ability to raise additional funds will depend on financial, economic and other factors, many of which are beyond our control. We cannot be certain that additional funding will be available on acceptable terms, or at all. We have limited committed sources of additional capital and if we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we may have to significantly delay, scale back or discontinue the development or commercialization of our product candidates or other research and development initiatives. Our license agreements may also be terminated if we are unable to meet the payment obligations or milestones under the agreements. We could be required to seek collaborators for our product candidates at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available or relinquish or license on unfavorable terms our rights to our product candidates in markets where we otherwise would seek to pursue development or commercialization ourselves.

Macroeconomic pressures in the markets in which we operate, including, but not limited to, the effect of the COVID-19 pandemic may alter the ways in which we conduct our business operations and manage our financial capacities.

To varying degrees, the ways in which we conduct our business operations and manage our financial capacities are influenced by macroeconomic conditions that affect companies directly involved in or providing services related to the drug and biological product development. For example, real GDP growth, business and investor confidence, the COVID-19 pandemic, inflation, employment levels, oil prices, interest rates, tax rates, availability of consumer and business financing, housing market conditions, foreign currency exchange rate fluctuations, costs for items such as fuel and food and other macroeconomic trends can adversely affect not only our decisions and ability to engage in research and development and clinical trials, but also those of our management, employees, third-party contractors, manufacturers and suppliers, competitors, stockholders and regulatory authorities. In addition, geopolitical issues around the world and how our markets are positioned can also impact the macroeconomic conditions and could have a material adverse impact on our financial results.

Economic uncertainty may adversely affect our access to capital, cost of capital and ability to execute our business plan as scheduled.

Generally, worldwide economic conditions remain uncertain. Access to capital markets is critical to our ability to operate. Traditionally, biotechnology companies have funded their research and development expenditures through raising capital in the equity markets. Declines and uncertainties in these markets in the past have severely restricted raising new capital and have affected companies’ ability to continue to expand or fund existing research and development efforts. We require significant capital for research and development for our product candidates and clinical trials. The general economic and capital market conditions, both in the U.S. and worldwide, have been volatile in the past and at times have adversely affected our access to capital and increased the cost of capital. There is no certainty that the capital and credit markets will be available to raise additional capital on favorable terms. If economic conditions become worse, our future cost of equity or debt capital and access to the capital markets could be adversely affected. In addition, if we are unable to access the capital markets on favorable terms, our ability to execute our business plan as scheduled would be compromised.

 

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Moreover, we rely and intend to rely on third-parties, including clinical research organizations, contract manufacturing organizations and other important vendors and consultants. Global economic conditions may result in a disruption or delay in the performance of our third-party contractors and suppliers. If such third-parties are unable to adequately satisfy their contractual commitments to us in a timely manner, our business could be adversely affected.

Our limited operating history and our evolving business make it difficult to evaluate our future prospects and the risks and challenges we may encounter.

We were formed in January 2014. Our limited operating history and our evolving business make it difficult to evaluate and assess the success of our business to date, our future prospects and the risks and challenges that we may encounter. These risks and challenges include our ability to:

 

   

accurately forecast our revenue and plan our expenses;

 

   

successfully introduce new products and services;

 

   

successfully compete with current and future competitors;

 

   

successfully expand our business in existing markets and enter new markets and geographies;

 

   

comply with existing and new laws and regulations applicable to our business and the industry in which we operate;

 

   

anticipate and respond to macroeconomic changes as well as changes in the markets and geographies in which we operate;

 

   

maintain and enhance the value of our reputation and brand;

 

   

maintain and expand our relationships with partners and payers;

 

   

successfully execute on our sales and marketing strategies;

 

   

hire, integrate and retain talented people at all levels of our organization;

 

   

expand through future acquisitions and successfully identify and integrate acquired entities;

 

   

successfully in-license or acquire other products and technologies and the terms of these transactions;

 

   

pursue viable product candidates across a variety of indications and disease areas;

 

   

successfully prepare, file, prosecute, maintain, expand, defend and enforce patent claims related to our programs; and

 

   

effectively manage our growth.

If we fail to address the risks and difficulties that we face, including those associated with the challenges listed above as well as those described elsewhere in this “Risk Factors” section, our business, financial condition, results of operations and prospects could be adversely affected. Further, because we have limited historical financial data and our business continues to evolve, any predictions about our future revenue and expenses may not be as accurate as they would be if we had a longer operating history, operated a more predictable business or operated in a less regulated industry. We have encountered and will continue to encounter multiple risks and uncertainties that are frequently experienced by growing companies with limited operating histories and evolving business that operate in rapidly changing, highly regulated and competitive industries. If our assumptions regarding these risks and uncertainties, which we use to plan and operate our business, are incorrect or change, or if we do not address these risks successfully, our results of operations could differ materially from our expectations and our business, financial condition and results of operations could be adversely affected.

 

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We will have broad discretion in the use of our capital from the Business Combination and may invest or spend the proceeds in ways with which you do not agree and in ways that may not increase the value of your investment.

Our management will have broad discretion in the application of the net proceeds from this offering and could spend the proceeds in ways that do not enhance the value of our securities. We may expend our resources to pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success. The failure by our management to apply these funds effectively could result in a negative impact on our business, cause the price of our securities to decline and delay the development of our product candidates. Pending their use, we may invest our cash and cash equivalents, including the net proceeds from this offering, in a manner that does not produce income or that loses value. If we do not invest or apply the proceeds of this offering in ways that improve our operating results, we may fail to achieve expected financial results, which could cause our stock price to decline.

Risks Related to the Discovery, Development and Regulatory Approval of Comera’s Product Candidates

Unless the context otherwise requires, all references in this “Risks Related to the Discovery, Development and Regulatory Approval of Comera’s Product Candidates” section to “we,” “us,” “our,” or the “Company” refer to Comera Life Sciences, Inc. prior to the consummation of the Business Combination.

We have never successfully completed the regulatory approval process for any of our product candidates and we may be unable to do so for any product candidates we acquire or develop.

We have not yet demonstrated our ability to successfully complete clinical trials, obtain regulatory approvals, manufacture a commercial scale product, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful commercialization. Our product candidates are still in preclinical development and may never advance to clinical development. If we are required to conduct additional preclinical studies or clinical trials of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, we may:

 

   

be delayed in obtaining regulatory approval for our product candidates;

 

   

not obtain regulatory approval at all;

 

   

obtain regulatory approval for indications or patient populations that are not as broad as intended or desired;

 

   

continue to be subject to post-marketing testing requirements; or

 

   

experience having the product removed from the market after obtaining regulatory approval.

Our failure to complete the regulatory approval process for one or more of our product candidates, or if the results of trials and testing result in delays, limitations, requirements, withholding or withdrawal in connection with the regulatory approval process, our business, financial condition and results of operations would be adversely affected.

Drug development is a lengthy, expensive and uncertain process. The results of preclinical studies and clinical trials are not always predictive of future results. If our preclinical studies and clinical trials are not sufficient to support regulatory approval of any of our product candidates, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development of such product candidate.

Currently, all our product candidates are in preclinical development. It is impossible to predict when or if any of our product candidates will receive regulatory approval. Before obtaining regulatory approval from regulatory authorities for the sale of any product candidate, we must complete preclinical studies and then

 

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conduct extensive clinical trials to demonstrate the safety, purity and potency of our biological product candidates in humans to the satisfaction of the FDA, EMA or comparable foreign regulatory authorities. Clinical testing is expensive, difficult to design and implement, can take many years to complete and the outcomes are uncertain. A failure of one or more clinical trials can occur at any stage of testing. Our preclinical studies may not be successful, which will limit our ability to execute on our business model effectively.

Results from preclinical studies and clinical trials can be interpreted in different ways. Even if we believe that the preclinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA, EMA or comparable regulatory authorities. The FDA or other regulatory authorities may also require us to conduct additional preclinical studies or clinical trials for our product candidates either prior to or post-approval, or they may object to elements of our clinical development program, requiring their alteration. Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain regulatory approval of their product candidates. Furthermore, the outcome of preclinical development testing and early clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results.

If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are not as positive as we expect or if there are safety concerns, our business and results of operations may be adversely affected and we may incur significant additional costs.

In addition, even if the clinical trials are successfully completed, preclinical and clinical data are often susceptible to varying interpretations and analyses, and we cannot guarantee that the FDA, EMA or comparable foreign regulatory authorities will interpret the results as we do, and more clinical trials could be required before we submit our product candidates for approval. To the extent that the results of the clinical trials are not satisfactory to the FDA, EMA or comparable foreign regulatory authorities for support of a marketing application, approval of our product candidates may be significantly delayed, or we may be required to expend significant additional resources, which may not be available to us, to conduct additional clinical trials in support of potential approval of our product candidates.

Any preclinical studies or clinical trials that we may conduct may not demonstrate the safety, efficacy, purity or potency necessary to obtain regulatory approval to market our product candidates. If the results of our ongoing or future preclinical studies and clinical trials are inconclusive with respect to the safety, efficacy, purity or potency of our product candidates, if we do not meet the clinical endpoints with statistical and clinically meaningful significance, or if there are safety concerns associated with our product candidates, we may be prevented or delayed in obtaining marketing approval for such product candidates. In some instances, there can be significant variability in safety or efficacy results between different clinical trials of the same product candidate due to numerous factors, including changes in trial procedures set forth in protocols, differences in the size and type of the patient populations, changes in and adherence to the clinical trial protocols and the rate of dropout among clinical trial participants. If the results of our ongoing or future clinical trials are inconclusive with respect to the efficacy of our product candidates, if we do not meet the clinical endpoints with statistical and clinically meaningful significance, or if there are safety concerns associated with our product candidates, we may be delayed in or prevented from obtaining marketing approval.

Additionally, some of the clinical trials we conduct may be open-label in study design and may be conducted at a limited number of clinical sites on a limited number of patients. An “open-label” clinical trial is one where both the patient and investigator know whether the patient is receiving the investigational product candidate or either an existing approved drug or placebo. Most typically, open-label clinical trials test only the investigational product candidate and sometimes may do so at different dose levels. Open-label clinical trials are

 

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subject to various limitations that may exaggerate any therapeutic effect as patients in open-label clinical trials are aware when they are receiving treatment. Open-label clinical trials may be subject to a “patient bias” where patients perceive their symptoms to have improved merely due to their awareness of receiving an experimental treatment. Moreover, patients selected for early clinical trials often include the most severe sufferers and their symptoms may have been bound to improve notwithstanding the new treatment. In addition, open-label clinical trials may be subject to an “investigator bias” where those assessing and reviewing the physiological outcomes of the clinical trials are aware of which patients have received treatment and may interpret the information of the treated group more favorably given this knowledge. The results from an open-label clinical trial may not be predictive of future clinical trial results when studied in a controlled environment with a placebo or active control.

For additional information regarding the risks that may apply to government regulation of our product candidates and operations, see the section entitled “— Risks Related to Government Regulation.”

Our current or future product candidates may cause adverse or other undesirable side effects or have other properties that could delay or prevent their regulatory approval, limit the commercial profile of an approved label or result in significant negative consequences following regulatory approval, if obtained.

Undesirable side effects caused by any of our product candidates could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the FDA, EMA or comparable foreign regulatory authorities. In our planned and future clinical trials of our product candidates, we may observe a more unfavorable safety and tolerability profile than was observed in earlier-stage testing of these candidates.

We may also observe additional safety or tolerability issues with our product candidates in ongoing or future clinical trials. Many compounds that initially showed promise in clinical or earlier-stage testing have later been found to cause undesirable or unexpected side effects that prevent further development of the compound. Results of future clinical trials of our product candidates could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics, despite a favorable tolerability profile observed in earlier-stage testing.

If unacceptable side effects arise in the development of our product candidates, we, the FDA, EMA or comparable foreign regulatory authorities, the institutional review boards (“IRBs”), or independent ethics committees at the institutions in which our trials are conducted, could suspend, limit or terminate our clinical trials, or the independent safety monitoring committee could recommend that we suspend, limit or terminate our trials, or the FDA, EMA or comparable foreign regulatory authorities could order us to cease clinical trials or deny approval of our product candidates for any or all targeted indications. Treatment-emergent side effects that are deemed to be drug-related could delay recruitment of clinical trial subjects or may cause subjects that enroll in our clinical trials to discontinue participation in our clinical trials. In addition, these side effects may not be appropriately recognized or managed by the treating medical staff. We may need to train medical personnel using our product candidates to understand the side effect profiles for our clinical trials and upon any commercialization of any of our product candidates. Inadequate training in recognizing or managing the potential side effects of our product candidates could result in harm to patients that receive our product candidates. Any of these occurrences may adversely affect our business, financial condition and prospects significantly.

Moreover, clinical trials of our product candidates will likely be conducted in carefully defined sets of patients who have agreed to enter into clinical trials. Consequently, it is possible that our clinical trials may indicate an apparent positive effect of a product candidate that is greater than the actual positive effect, if any, or alternatively fail to identify undesirable side effects.

We may incur additional costs or experience delays in initiating or completing, or ultimately be unable to complete, the development and commercialization of our product candidates.

We may experience delays in initiating or completing our preclinical studies or clinical trials for various reasons, including as a result of delays in obtaining, or failure to obtain, the FDA’s clearance to initiate clinical

 

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trials under future investigational new drug applications (“INDs”). Additionally, we cannot be certain that preclinical studies or clinical trials for our product candidates will not require redesign, will enroll an adequate number of subjects on time, or will be completed on schedule, if at all. We may experience numerous unforeseen events during, or as a result of, preclinical studies and clinical trials that could delay or prevent our ability to receive regulatory approval or commercialize our product candidates, including the following:

 

   

we may receive feedback from regulatory authorities that require us to modify the design or implementation of our preclinical studies or clinical trials or to delay or terminate a clinical trial;

 

   

regulators or IRBs or ethics committees may delay or may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site;

 

   

we may experience delays in reaching, or fail to reach, agreement on acceptable terms with prospective trial sites and prospective clinical research organizations (“CROs”), the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites;

 

   

preclinical studies or clinical trials of our product candidates may fail to show safety, efficacy, purity or potency, or otherwise produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional preclinical studies or clinical trials, or we may decide to abandon product research or development programs;

 

   

preclinical studies or clinical trials of our product candidates may not produce differentiated or clinically significant results;

 

   

the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate or participants may drop out of these clinical trials or fail to return for post-treatment follow-up at a higher rate than we anticipate;

 

   

our third-party contractors may fail to comply with regulatory requirements, fail to maintain adequate quality controls, be unable to provide us with sufficient product supply to conduct or complete preclinical studies or clinical trials, fail to meet their contractual obligations to us in a timely manner, or at all, or may deviate from the clinical trial protocol or drop out of the trial, which may require that we add new clinical trial sites or investigators;

 

   

we may elect to, or regulators or IRBs or ethics committees may require us or our investigators to, suspend or terminate clinical research for various reasons, including noncompliance with regulatory requirements or a finding that the participants in our clinical trials are being exposed to unacceptable health risks;

 

   

the cost of clinical trials of our product candidates may be greater than we anticipate;

 

   

clinical trials of our product candidates may be delayed due to complications associated with the evolving COVID-19 pandemic;

 

   

the supply or quality of our product candidates or other materials necessary to conduct clinical trials of our product candidates may be insufficient or inadequate;

 

   

our product candidates may have undesirable side effects or other unexpected characteristics, causing us or our investigators, regulators or IRBs or ethics committees to suspend or terminate the trials, or reports may arise from preclinical or clinical testing of other therapies that raise safety or efficacy concerns about our product candidates;

 

   

collaborators may conduct clinical trials in ways they view as advantageous to them but that are suboptimal for us;

 

   

regulators may revise the requirements for approving our product candidates, or such requirements may not be as we anticipate;

 

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the FDA may require us to conduct clinical trials comparing our product candidates against the current standard of care in the U.S.; and

 

   

the FDA may refuse to file a Biologics License Application (“BLA”) or New Drug Application (“NDA”) within 60 days of our submission if it is incomplete or insufficient.

We could encounter delays if a clinical trial is suspended or terminated by us or our partners, by the IRBs of the institutions at which such trials are being conducted, by the Data Safety Monitoring Board, or DSMB, for such trial or by the FDA or other regulatory authorities. Such authorities may impose such a suspension or termination or clinical hold due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, adverse findings upon an inspection of the clinical trial operations or trial site by the FDA or other regulatory authorities, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a product, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial. Many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of our product candidates. Further, the FDA may disagree with our clinical trial design or our interpretation of data from clinical trials or may change the requirements for approval even after it has reviewed and commented on the design for our clinical trials.

Our product development costs will also increase if we experience delays in testing or regulatory approvals. We do not know whether any of our future clinical trials will begin as planned, or whether any of our current or future clinical trials will need to be restructured or will be completed on schedule, if at all. Significant preclinical study or clinical trial delays, including those caused by the COVID-19 pandemic, also could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before we do, which would impair our ability to successfully commercialize our product candidates and may significantly harm our business, operating results, financial condition and prospects.

We may investigate our product candidates in combination with other therapies, which exposes us to additional risks.

We may investigate our product candidates in combination with one or more other approved or unapproved therapies to treat medical conditions. Even if any product candidate we develop were to receive marketing approval or be commercialized for use in combination with other existing therapies, we would continue to be subject to the risks that the FDA or comparable foreign regulatory authorities outside of the United States could revoke approval of the therapy used in combination with our product or that safety, efficacy, manufacturing or supply issues could arise with any of those existing therapies. If the therapies we use in combination with our product candidates are replaced as the standard of care for the indications we choose for any of our product candidates, the FDA or comparable foreign regulatory authorities may require us to conduct additional clinical trials. The occurrence of any of these risks could result in our own products, if approved, being removed from the market or being less successful commercially.

 

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Risks Related to Comera’s Business Operations and Industry

Unless the context otherwise requires, all references in this “Risks Related to Comera’s Business Operations and Industry” section to “we,” “us,” “our,” or the “Company” refer to Comera Life Sciences, Inc. prior to the consummation of the Business Combination.

We may experience fluctuations in our operating results, which could make our future operating results difficult to predict or cause our operating results to fall below analysts’ and investors’ expectations.

Our quarterly and annual operating results may fluctuate significantly in the future due to a variety of factors, many of which are outside of our control and may be difficult to predict, including the following:

 

   

the timing and success or failure of clinical trials for our product candidates or competing product candidates, or any other change in the competitive landscape of our industry, including consolidation among our competitors or partners;

 

   

our ability to successfully recruit and retain subjects for clinical trials, and any delays caused by difficulties in such efforts;

 

   

our ability to obtain marketing approval for our product candidates, and the timing and scope of any such approvals we may receive;

 

   

the timing and cost of, and level of investment in, research and development activities relating to our product candidates, which may change from time to time;

 

   

the cost of manufacturing our product candidates, which may vary depending on the difficulty of manufacture, quantity of production and the terms of our agreements with manufacturers;

 

   

our ability to attract, hire and retain qualified personnel;

 

   

expenditures that we will or may incur to develop additional product candidates;

 

   

the level of demand for our product candidates should they receive approval, which may vary significantly;

 

   

the risk/benefit profile, cost and reimbursement policies with respect to our product candidates, if approved, and existing and potential future therapeutics that compete with our product candidates;

 

   

general market conditions or extraordinary external events, such as recessions or the COVID-19 pandemic;

 

   

the changing and volatile U.S. and global economic environments; and

 

   

future accounting pronouncements or changes in our accounting policies.

The cumulative effects of these factors could result in large fluctuations and unpredictability in our quarterly and annual operating results. As a result, comparing our operating results on a period-to-period basis may not be meaningful. This variability and unpredictability could also result in our failing to meet the expectations of industry or financial analysts or investors for any period. If our operating results fall below the expectations of analysts or investors or below any forecasts we may provide to the market, or if the forecasts we provide to the market are below the expectations of analysts or investors, the price of our securities could decline substantially. Such price decline could occur even when we have met any previously publicly stated guidance we may provide.

Our success depends on broad market acceptance of our products if approved, which we may never achieve.

Our proposed product candidates may include new versions of existing approved intravenous biological products, with reduced viscosity and other features designed to allow our products to be administered by subcutaneous injection; new improved versions of existing subcutaneous biologics; or biosimilar versions of

 

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existing subcutaneous biologics. Thus, the success of our product candidates will depend primarily on our products demonstrating advantages over the existing products in terms of safety, efficacy, convenience, or other factors. If FDA and other regulatory authorities does not approve our products with labeling that allows us to promote such advantages, we may not be able to compete with the existing reference biologic products. Even if our current product candidates and any future product candidates are approved by the appropriate regulatory authorities for marketing and sale with desirable labeling regarding advantages of our products, they still may not gain acceptance among physicians, patients, third-party payers, and others in the medical community. If any product candidates for which we obtain regulatory approval do not gain an adequate level of market acceptance, we may not generate significant revenue and may not grow or maintain profitability. Market acceptance of our current product candidates and any future product candidates by the medical community, patients and third-party payers will depend on a number of factors, some of which are beyond our control. For example, physicians are often reluctant to switch their patients, and patients may be reluctant to switch, from existing therapies even when new and potentially more effective or safer treatments enter the market. Physicians and healthcare providers earn revenue from intravenous infusion procedures and may be reluctant to switch patients to products that allow in-home self-administration. If public perception is influenced by claims that the use of our products is unsafe, our products, once approved, may not be accepted by the general public or the medical community. Future adverse events could also result in greater governmental regulation, stricter labeling requirements and potential regulatory delays in the testing or approvals of our product candidates.

Efforts to educate the medical community and third-party payers on the benefits of our current product candidates and any future product candidates may require significant resources and may not be successful. If our current product candidates or any future product candidates are approved but do not achieve an adequate level of market acceptance, we could be prevented from or significantly delayed in achieving profitability. The degree of market acceptance of any of our current product candidates and any future product candidates will depend on a number of factors, including:

 

   

our ability to obtain regulatory approval of labeling to support our products’ advantages over competing products with the same active molecule used for the same indication(s);

 

   

the efficacy of our current product candidates and any future product candidates;

 

   

the prevalence and severity of adverse events associated with our current product candidates and any future product candidates or those products with which they may be co-administered;

 

   

the clinical indications for which our product candidates are approved and the approved claims that we may make for the products;

 

   

limitations or warnings contained in the product’s FDA-approved labeling or those of comparable foreign regulatory authorities, including potential limitations or warnings for our current product candidates and any future product candidates that may be more restrictive than other competitive products;

 

   

changes in the standard of care for the targeted indications for our current product candidates and any future product candidates, or in applicable clinical practice guidelines, any of which could reduce the marketing impact of any claims that we could make following FDA approval or approval by comparable foreign regulatory authorities, if obtained;

 

   

the relative convenience and ease of administration of our current product candidates and any future product candidates and any products with which they are co-administered;

 

   

the cost of treatment compared with the economic and clinical benefit of alternative treatments or therapies;

 

   

the availability of adequate coverage or reimbursement by third party payers;

 

   

the price concessions required by third-party payers to obtain coverage;

 

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the willingness of patients to pay out-of-pocket in the absence of adequate coverage and reimbursement;

 

   

the extent and strength of our marketing and distribution of our current product candidates and any future product candidates;

 

   

the cost, safety, efficacy, and other potential advantages over, and availability of, alternative treatments already used or that may later be approved;

 

   

distribution and use restrictions imposed by the FDA or comparable foreign regulatory authorities with respect to our current product candidates and any future product candidates or to which we agree as part of a Risk Evaluation and Mitigation Strategy (“REMS”) or voluntary risk management plan;

 

   

the timing of market introduction of our current product candidates and any future product candidates, as well as competitive products;

 

   

the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies;

 

   

the extent and strength of our third-party manufacturer and supplier support;

 

   

the actions of companies that market any products with which our current product candidates and any future product candidates may be co-administered;

 

   

the approval of other new products;

 

   

adverse publicity about our current product candidates and any future product candidates or any products with which they are co-administered, or favorable publicity about competitive products; and

 

   

potential product liability claims.

We may not be successful in addressing these or other factors that might affect the market acceptance of our product candidates. Failure to achieve widespread market acceptance of our product candidates would materially harm our business, operating results, financial condition and prospects.

We operate in an intensely competitive market that includes companies with greater financial, technical and marketing resources than us.

The development and commercialization of new products in the biopharmaceutical and related industries is highly competitive and characterized by rapidly advancing technologies and a strong emphasis on intellectual property. We face substantial competition from many different sources, including pharmaceutical and biotechnology companies, academic research institutions and governmental agencies and public and private research institutions across various components of our product and service offerings.

Our competitors include divisions of large pharmaceutical companies and biotechnology companies of various sizes. We face competition with respect to our current product candidates and will face competition with respect to any product candidates that we may seek to develop or commercialize in the future, from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide. Potential competitors also include academic institutions, government agencies and other public and private research organizations that conduct research, seek patent protection and establish collaborative arrangements for research, development, manufacturing and commercialization. Any product candidate that we successfully develop and commercialize will compete with currently approved therapies and new therapies that may become available in the future from segments of the pharmaceutical, biotechnology and other related markets. Key product features that would affect our ability to effectively compete with other therapeutics include the efficacy, safety, convenience and cost of our products. We believe principal competitive factors to our business include, among other things, the scalability of our pipeline and business, our innovative technology, and our access to, and ability to raise capital.

 

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Many of the companies that we compete against or which we may compete against in the future have significantly greater financial resources and expertise in research and development, manufacturing, preclinical and clinical testing, obtaining regulatory approvals and marketing approved products than we do. These companies will also be able to efficiently develop and market products in multiple indications or disease areas faster than we can. Mergers and acquisitions in the pharmaceutical, biotechnology and diagnostic industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our strategy.

Our commercial opportunity could be reduced or eliminated if our competitors engage in more extensive research and development efforts, undertaking more impactful marketing campaigns, adopt more aggressive pricing strategies, which may allow them to increase their market share or generate revenue more effectively than we do. Also, some of our current competitors have, and potential competitors may have, longer operating histories, greater brand recognition, greater global infrastructures, greater resources and technical capabilities, significantly greater financial, marketing and other resources and larger customer bases than we do. In addition, our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient than any products that we may develop. Our competitors may also obtain FDA or other regulatory approval for their products sooner than we may obtain approval for ours and for multiple indications in parallel, which could result in our competitors establishing a strong market position before we are able to enter the market. The key competitive factors affecting the success of all of our product candidates, if approved, are likely to be their efficacy, safety, convenience, price, level of competition, and availability of reimbursement from government and other third-party payers.

From time to time, stockholders, competitors and activist investors may attempt to influence us, which could adversely affect our operations, financial condition and the value of our stock.

Market participants, such as our direct and indirect competitors and activist stockholders, may propose a variety of actions for our company, including seeking to acquire a controlling stake in our company, engaging in proxy solicitations, involving themselves in the governance and strategic direction of our company, or otherwise attempting to effect changes at our company. Campaigns by stockholders to effect changes at publicly-traded companies are sometimes led by investors seeking to increase short-term stockholder value through actions such as financial restructuring, increased debt, special dividends, stock repurchases, or sales of assets or the entire company or changes to our business strategy. Such campaigns can be led by stockholders that have interests that are different from the majority of our stockholders and our board, and may not be in the best interests of the company. Responding to proxy contests and other actions by stockholders can be costly and time-consuming, could disrupt our operations and divert the attention of our board of directors and senior management from the pursuit of our business strategies, and otherwise adversely affect our operations, financial condition and the value of our securities.

The COVID-19 pandemic, or a similar pandemic, epidemic, or outbreak of an infectious disease, may materially and adversely affect our business and our financial results and could cause a disruption to the development of our product candidates.

Public health crises such as pandemics or similar outbreaks could adversely impact our business. The coronavirus pandemic is evolving, and has led to the implementation of various responses, including government-imposed quarantines, travel restrictions and other public health safety measures. The extent to which the coronavirus impacts our operations or those of our third-party partners, including our preclinical studies or clinical trial operations, will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the outbreak, new information that will emerge concerning the

 

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severity of the coronavirus and the actions to contain the coronavirus or treat its impact, among others. The continued spread of COVID-19 globally could adversely impact our preclinical or clinical trial operations, including our ability to recruit and retain patients and principal investigators and site staff who, as healthcare providers, may have heightened exposure to COVID-19 if an outbreak occurs in their geography. For example, similar to other biopharmaceutical companies, we or our collaborators may experience delays in initiating studies, protocol deviations, enrolling clinical trials, or dosing of patients in clinical trials as well as in activating new trial sites. COVID-19 may also affect employees of third-party contract research organizations located in affected geographies that we or our collaborators rely upon to carry out clinical trials. Any negative impact COVID-19 has to patient enrollment or treatment or the execution of our product candidates could cause costly delays to clinical trial activities, which could adversely affect our ability to obtain regulatory approval for and to commercialize our product candidates, increase our operating expenses, and have a material adverse effect on our financial results.

Our employees, agents, contractors, consultants, and vendors as well as our license, research and collaboration partners may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements.

We cannot provide assurance that our compliance controls, policies, and procedures will in every instance protect us from acts committed by our employees, agents, contractors, consultants, commercial partners, and vendors that would violate the law or regulation of the jurisdictions in which we operate, including, without limitation, healthcare, employment, foreign corrupt practices, environmental, competition, and patient privacy and other privacy laws and regulations. Such improper actions could subject us to civil or criminal investigations and monetary and injunctive penalties, and could adversely impact our ability to conduct business, operating results, and reputation. We are exposed to the risk of employee fraud or other illegal activity by our employees, independent contractors, consultants, commercial partners, and vendors. Misconduct by these parties could include intentional, reckless, and/or negligent conduct that fails to comply with the laws enforced by the FDA and comparable foreign regulatory authorities, fails to provide true, complete and accurate information to the FDA and comparable foreign regulatory authorities, fails to comply with manufacturing standards, fails to comply with healthcare fraud and abuse laws in the United States and similar foreign laws, or fails to report financial information or data accurately or to disclose unauthorized activities to us. If we obtain FDA approval of any of our product candidates and begin commercializing those products in the United States, our potential exposure under these laws will increase significantly, and our costs associated with compliance with these laws are also likely to increase. In particular, sales, marketing and business arrangements in the healthcare industry are subject to extensive laws and regulations intended to prevent fraud, misconduct, kickbacks, self-dealing and other abusive practices. These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements. Activities subject to these laws could also involve the improper use of information obtained in the course of clinical trials or creating fraudulent data in our preclinical studies or clinical trials, which could result in regulatory sanctions and cause serious harm to our reputation. Additionally, we are subject to the risk that a person could allege such fraud or other misconduct, even if none occurred. These laws and regulations may impact, among other things, proposed and future sales, marketing, and education programs. It is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from government investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations. If our operations are found to be in violation of any of the laws and regulations that may apply to us, we may be subject to the imposition of civil, criminal, and administrative penalties, damages, monetary fines, possible exclusion from participation in Medicare, Medicaid, and other federal and state healthcare programs, contractual damages, reputational harm, diminished profits and future earnings, and curtailment of our operations, any of which could adversely affect our ability to operate our business and our results of operations. If any of the physicians or other providers or entities with whom we expect to do business are found to not be in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs and imprisonment.

 

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Negative media coverage could adversely affect our business and commitments to self-regulation may subject us to investigations and litigation.

The healthcare industry receives a high degree of media coverage in the United States. Unfavorable publicity regarding, for example, the healthcare industry, litigation or regulatory activity, our offerings and products, medication pricing, pricing structures in place amongst the industry participants, our data privacy or data security practices or our revenue could adversely affect our reputation. Such negative publicity also could have an adverse effect on our ability to attract and retain collaborators, partners, or employees, and result in decreased revenue, which would adversely affect our business, financial condition and results of operation.

In addition, commitments to self-regulation in the healthcare industry may subject us to investigation by government or self-regulatory bodies, government or private litigation, and harm our reputation, brand, business, operating results and financial condition.

Our success depends on our ability to retain key members of our management team and on our ability to hire, train, retain and motivate new employees.

Our success depends on the skills, experience and performance of key members of our senior management team. The individual and collective efforts of these and other members of our senior management team will be important as we continue to develop product candidates, establish strategic partnerships and build out our operations. The loss or incapacity of existing members of our executive management team could adversely affect our operations if we experience difficulties in hiring qualified successors. Our executive officers have signed employment agreements with us, but their service is at-will and may end at any point in time.

Our research and development initiatives and laboratory operations depend on our ability to attract and retain highly skilled scientists, technicians and engineers. We may not be able to attract or retain qualified scientists, clinical personnel, technicians or engineers in the future due to the competition for qualified personnel among life science and technology businesses. We also face competition from universities and public and private research institutions in recruiting and retaining highly qualified scientific personnel. We may have difficulties locating, recruiting or retaining qualified personnel across functions that we deem critical to our success. Recruiting, training and retention difficulties can limit our ability to support our research and development and commercialization efforts. All of our employees are at-will, which means that either we or the employee may terminate their employment at any time.

In addition, we rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our research and development, regulatory and commercialization strategy. Our consultants and advisors may provide services to other organizations and may have commitments under consulting or advisory contracts with other entities that may limit their availability to us. The loss of the services of one or more of our current consultants or advisors might impede the achievement of our research, development, regulatory and commercialization objectives.

Our reliance on third parties heightens the risks we face.

We rely on suppliers, vendors and partners for certain key aspects of our business, including support for information technology systems and certain human resource functions. We do not control these partners, but we depend on them in ways that may be significant to us. If these parties fail to meet our expectations or fulfill their obligations to us, we may fail to receive the expected benefits. In addition, if any of these third parties fails to comply with applicable laws and regulations in the course of its performance of services for us, there is a risk that we may be held responsible for such violations as well. This risk is particularly serious in emerging markets, where corruption is often prevalent and where the third parties that we may come to rely on do not have internal compliance resources comparable to our own. Any such failures by third parties, in emerging markets or elsewhere, could adversely affect our business, reputation, financial condition or results of operations.

 

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We rely on, and intend to continue to rely on third parties to conduct our pre-clinical testing, research and clinical trials, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials, research or testing.

We have been relying on third parties for our preclinical studies, and we expect to continue to rely on third parties, such as CROs, contract manufacturers of clinical supplies, clinical data management organizations, medical institutions and clinical investigators, to conduct our clinical trials and to conduct some aspects of our research and pre-clinical testing. These third parties may terminate their engagements with us at any time. If these third parties do not successfully carry out their duties, meet expected deadlines or conduct our studies in accordance with regulatory requirements or our stated protocols, we will not be able to obtain, or may be delayed in obtaining, marketing approvals for our product candidates and will not be able to, or may be delayed in our efforts to, successfully commercialize our product candidates. Furthermore, these third parties may also have relationships with other entities, some of which may be our competitors. If we are required to enter into alternative arrangements, it could delay our product development activities.

Our reliance on third parties for research and development activities will reduce our control over these activities but will not relieve us of our responsibilities. For example, we will remain responsible for ensuring that each of our clinical trials is conducted in accordance with the general investigational plan and protocols for the trial. Moreover, the FDA and other international regulatory authorities require us to comply with GCP standards for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of trial participants are protected. We also are required to register ongoing clinical trials and post the results of completed clinical trials on a government-sponsored database, available at www.clinicaltrials.gov, within certain timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.

We do not yet have effective disclosure controls and procedures, and internal control over financial reporting.

We do not yet have effective disclosure controls and procedures, or internal controls over all aspects of our financial reporting. We are continuing to develop and refine our disclosure controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we will file with the SEC is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Our management has deemed certain conditions to be material weaknesses in our internal controls in connection with our 2020 financial statements. A deficiency in internal controls exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. For example, we failed to provide optimal levels of oversight in order to process financial information in a timely manner, analyze and account for complex, non-routine transactions, and prepare financial statements. Our management is responsible for establishing and maintaining adequate internal control over our financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. We have expended, and will be required to continue expending, time and resources to further improve our internal controls over financial reporting, including by expanding our staff. We cannot assure you that our internal control over financial reporting, as modified, will enable us to identify or avoid material weaknesses in the future.

If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud. As a result, stockholders could lose confidence in our financial and other public reporting, which would harm our business and the trading price of our common stock.

Effective internal controls over financial reporting are necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation could cause us

 

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to fail to meet our reporting obligations. In addition, any testing by us conducted in connection with Section 404, or any subsequent testing by our independent registered public accounting firm, may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses or that may require prospective or retroactive changes to our financial statements or identify other areas for further attention or improvement. Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our securities. We will be required to disclose changes made in our internal controls and procedures on a quarterly basis and our management will be required to assess the effectiveness of these controls annually. However, for as long as we are an emerging growth company, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal controls over financial reporting pursuant to Section 404. An independent assessment of the effectiveness of our internal controls over financial reporting could detect problems that our management’s assessment might not. Undetected material weaknesses in our internal controls over financial reporting could lead to financial statement restatements and require us to incur the expense of remediation.

Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud. We believe that any disclosure controls and procedures or internal controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake.

Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by an unauthorized override of the controls. Accordingly, because of the inherent limitations in our control system, misstatements or insufficient disclosures due to error or fraud may occur and not be detected.

Risks Related to Comera’s Strategic Agreements and Relationships with Third Parties

Unless the context otherwise requires, all references in this “Risks Related to Comera’s Strategic Agreements and Relationships with Third Parties” section to “we,” “us,” “our,” or the “Company” refer to Comera Life Sciences, Inc. prior to the consummation of the Business Combination.

We are currently party to several in-license agreements under which we acquired rights to use, develop, manufacture and/or commercialize certain of our product candidates, and expect to enter additional collaborations in the future. If these collaborations are not successful, our business could be adversely affected.

We have entered into in-license agreements with multiple licensors and in the future expect to seek and form strategic alliances, create joint ventures or collaborations, or enter into acquisitions or additional licensing arrangements with third parties that we believe will complement or augment our existing technologies and product candidates. We may not realize the benefits of any acquisitions, in-licenses or strategic alliances that we enter into. These transactions can entail numerous operational and financial risks, including exposure to unknown liabilities, disruption of our business and diversion of our management’s time and attention in order to manage a collaboration or develop acquired products, product candidates or technologies, incurrence of substantial debt or dilutive issuances of equity securities to pay transaction consideration or costs, higher than expected collaboration, acquisition or integration costs, write-downs of assets or goodwill or impairment charges, increased amortization expenses, difficulty and cost in facilitating the collaboration or combining the operations and personnel of any acquired business, impairment of relationships with key suppliers, manufacturers or customers of any acquired business due to changes in management and ownership and the inability to retain key employees of any acquired business. As a result, we may not be able to realize the benefits of such existing or future acquisitions or in-licenses if we are unable to successfully integrate them into our operations and company culture. Following a strategic transaction or license, we may not achieve the revenue or specific net income that justifies such transaction or such other benefits that led us to enter into the arrangement. If we breach our obligations under these agreements, we may be required to pay damages, lose our rights to these programs or both, which would adversely affect our business and prospects.

 

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Any collaborations we enter into may pose several risks, including the following:

 

   

Collaborators may have significant discretion in determining the efforts and resources that they will apply to these collaborations;

 

   

Collaborators may not perform their obligations as expected;

 

   

The clinical trials conducted as part of these collaborations may not be successful;

 

   

Collaborators may not pursue development and/or commercialization of any product candidates that achieve regulatory approval or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the collaborators’ strategic focus or available funding or external factors, such as an acquisition, that divert resources or create competing priorities;

 

   

Collaborators may delay or provide insufficient funding for development efforts or undertake efforts that create questions of safety and efficacy regarding or related programs, and they may not provide us with the necessary data and support needed to facilitate our planned development and regulatory strategy;

 

   

Collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our product candidates if the collaborators believe that competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours;

 

   

Product candidates developed in collaboration with us may be viewed by collaborators as competitive with their own product candidates or products, which may cause collaborators to cease to devote resources to the commercialization of our product candidates;

 

   

Disagreements with collaborators, including disagreements over proprietary rights, contract interpretation or the preferred course of development of any programs or product candidates, may cause delays or termination of the research, development, manufacture or commercialization of such programs or product candidates, may lead to additional responsibilities for us with respect to such programs or product candidates or may result in litigation or arbitration, any of which would be time-consuming and expensive;

 

   

Collaborators may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation;

 

   

Disputes may arise with respect to the ownership of intellectual property developed pursuant to our collaborations;

 

   

Collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability; and

 

   

Collaborations may be terminated and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates.

If our collaborations do not result in the successful development and commercialization of products, or if one of any future collaborators terminates its agreement with us, we may not receive any milestone or royalty payments under the collaboration. If we do not receive the payments we expect under these agreements, our development of product candidates could be delayed and we may need additional resources to develop our product candidates. All of the risks relating to product development, regulatory approval and commercialization summarized and described in this report also apply to the activities of our collaborators.

In addition, if any collaborator terminates its agreement with us, we may find it more difficult to attract new collaborators and our reputation among the business and financial communities could be adversely affected.

 

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We may seek to establish additional collaborations, and, if we are not able to establish them on commercially reasonable terms, or at all, we may have to alter our development and commercialization plans.

Our product development programs and the potential commercialization of our product candidates will require substantial additional cash to fund expenses. For some of our product candidates, we may decide to collaborate with pharmaceutical and biotechnology companies for the development and potential commercialization of those product candidates.

We face significant competition in seeking appropriate collaborators. Whether we reach a definitive agreement for a collaboration will depend, among other things, upon our assessment of the collaborator’s resources and expertise, the terms and conditions of the proposed collaboration and the proposed collaborator’s evaluation of a number of factors. Those factors may include the design or results of clinical trials, the likelihood of approval by the FDA or similar regulatory authorities outside the United States, the potential market for the subject product candidate, the costs and complexities of manufacturing and delivering such product candidate to patients, the potential of competing products, the existence of uncertainty with respect to our ownership of technology, which can exist if there is a challenge to such ownership without regard to the merits of the challenge and industry and market conditions generally. The collaborator may also consider alternative product candidates or technologies for similar indications that may be available to collaborate on and whether such a collaboration could be more attractive than the one with us for our product candidate. The terms of any additional collaborations or other arrangements that we may establish may not be favorable to us.

We may also be restricted under collaboration agreements from entering into future agreements on certain terms with potential collaborators. Collaborations are complex and time-consuming to negotiate and document. In addition, there have been a significant number of recent business combinations among large pharmaceutical companies that have resulted in a reduced number of potential future collaborators.

We may not be able to negotiate additional collaborations on a timely basis, on acceptable terms, or at all. If we are unable to do so, we may have to curtail the development of the product candidate for which we are seeking to collaborate, reduce or delay its development program or one or more of our other development programs, delay its potential commercialization or reduce the scope of any sales or marketing activities, or increase our expenditures and undertake development or commercialization activities at our own expense. If we elect to increase our expenditures to fund development or commercialization activities on our own, we may need to obtain additional capital, which may not be available to us on acceptable terms or at all. If we do not have sufficient funds, we may not be able to further develop our product candidates or bring them to market and generate product revenue.

We may be required to pay certain milestones and royalties under our license or collaboration agreements with third-party licensors or collaborators.

Under our future license or collaboration agreements, we may be required to pay milestones, royalties and other payments based on our revenues, including revenues from product sales, and these milestones and royalty payments could adversely affect the overall profitability of any products that we may seek to commercialize. In order to maintain our rights under these agreements, we may need to meet certain specified milestones in the development of our product candidates. Further, our licensors (or their licensors), licensees or other strategic collaborators may dispute the terms, including amounts, that we are required to pay under the respective license or collaboration agreements. If these claims result in a material increase in the amounts that we are required to pay to our licensors or collaborators, or in a claim of breach of the license, our ability to research, develop and obtain approval of product candidates or to commercialize our products could be significantly impaired.

 

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We may rely on third parties to conduct our future clinical trials of our product candidates, in the U.S. and other jurisdictions. If these third parties do not successfully carry out their contractual duties, comply with regulatory requirements or meet expected deadlines, we may not be able to obtain regulatory approval for or commercialize our product candidates and our business could be substantially harmed.

We do not have the ability to independently conduct clinical trials. We expect to rely on medical institutions, clinical investigators, contract laboratories and other third parties, such as CROs, to conduct or otherwise support clinical trials for our product candidates. We may also rely on academic and private non-academic institutions to conduct and sponsor clinical trials relating to our product candidates. We will not control the design or conduct of the investigator-sponsored trials, and it is possible that the FDA or non-U.S. regulatory authorities will not view these investigator-sponsored trials as providing adequate support for future clinical trials, whether controlled by us or third parties, for any one or more reasons, including elements of the design or execution of the trials or safety concerns or other trial results.

Such arrangements will likely provide us certain information rights with respect to the investigator-sponsored trials, including access to and the ability to use and reference the data, including for our own regulatory filings, resulting from the investigator-sponsored trials. However, we would not have control over the timing and reporting of the data from investigator-sponsored trials, nor would we own the data from the investigator-sponsored trials. If we are unable to confirm or replicate the results from the investigator-sponsored trials or if negative results are obtained, we would likely be further delayed or prevented from advancing further clinical development of our product candidates. Further, if investigators or institutions breach their obligations with respect to the clinical development of our product candidates, or if the data proves to be inadequate compared to the first-hand knowledge we might have gained had the investigator-sponsored trials been sponsored and conducted by us, then our ability to design and conduct any future clinical trials ourselves may be adversely affected.

We, our principal investigators and our CROs are required to comply with regulations, including Good Clinical Practices (“GCPs”), for conducting, monitoring, recording and reporting the results of clinical trials to ensure that the data and results are scientifically credible and accurate, and that the trial patients are adequately informed of the potential risks of participating in clinical trials and their rights are protected. These regulations are enforced by the FDA, the Competent Authorities of the Member States of the European Economic Area and comparable foreign regulatory authorities for any products in clinical development. The FDA enforces GCP regulations through periodic inspections of clinical trial sponsors, principal investigators and trial sites. If we, our principal investigators or our CROs fail to comply with applicable GCPs, the clinical data generated in our clinical trials may be deemed unreliable and the FDA or comparable foreign regulatory authorities may require us to perform additional clinical trials before approving our marketing applications. We cannot assure you that, upon inspection, the FDA will determine that any of our future clinical trials will comply with GCPs. In addition, our clinical trials must be conducted with product candidates produced under current Good Manufacturing Practice (“cGMP”) regulations. Our failure or the failure of our principal investigators or CROs to comply with these regulations may require us to repeat clinical trials, which would delay the regulatory approval process, significantly increase our expenditures and could also subject us to enforcement action. We also are required to register ongoing clinical trials and post the results of completed clinical trials on a government-sponsored database, ClinicalTrials.gov, within certain timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.

Many of our current and planned clinical trials are conducted by CROs and we expect CROs will conduct all of our future clinical trials. As a result, many important aspects of our development programs, including their conduct and timing, are outside of our direct control. Our reliance on third parties to conduct future clinical trials also results in less direct control over the management of data developed through clinical trials than would be the case if we were relying entirely upon our own staff. Communicating with outside parties can also be challenging, potentially leading to mistakes as well as difficulties in coordinating activities. Outside parties may:

 

   

have staffing difficulties;

 

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fail to comply with contractual obligations;

 

   

experience regulatory compliance issues;

 

   

undergo changes in priorities or become financially distressed; or

 

   

form relationships with other entities, some of which may be our competitors.

These factors may adversely affect the willingness or ability of third parties to conduct our clinical trials and may subject us to unexpected cost increases that are beyond our control. If the principal investigators or CROs do not perform clinical trials in a satisfactory manner, breach their obligations to us or fail to comply with regulatory requirements, the development, regulatory approval and commercialization of our product candidates may be delayed, we may not be able to obtain regulatory approval and commercialize our product candidates or our development program may be materially and irreversibly harmed. If we are unable to rely on clinical data collected by our principal investigators or CROs, we could be required to repeat, extend the duration of, or increase the size of any clinical trials we conduct and this could significantly delay commercialization and require significantly greater expenditures.

If any of our relationships with these third-party principal investigators or CROs terminate, we may not be able to enter into arrangements with alternative CROs. If principal investigators or CROs do not successfully carry out their contractual obligations or meet expected deadlines, if they need to be replaced or if the quality or accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols, regulatory requirements or for other reasons, any clinical trials such principal investigators or CROs are associated with may be extended, delayed or terminated, and we may not be able to obtain regulatory approval for, or successfully commercialize, our product candidates. As a result, we believe that our financial results and the commercial prospects for our product candidates in the subject indication would be harmed, our costs could increase and our ability to generate revenue could be delayed.

We contract with third parties for the manufacture of our product candidates for preclinical development, clinical testing, and expect to continue to do so for commercialization. This reliance on third parties increases the risk that we will not have sufficient quantities of our product candidates or products or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.

We do not currently own or operate, nor do we have any plans to establish in the future, any manufacturing facilities or manufacturing personnel. We rely, and expect to continue to rely, on third parties for the manufacture of our product candidates for preclinical development and clinical testing, as well as for the commercial manufacture of our products if any of our product candidates receive marketing approval. This reliance on third parties increases the risk that we will not have sufficient quantities of our product candidates or products or such quantities at an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts.

The facilities used by our contract manufacturers to manufacture our product candidates must be inspected by the FDA pursuant to pre-approval inspections that will be conducted after we submit our marketing applications to the FDA. We do not control the manufacturing process of, and will be completely dependent on, our contract manufacturers for compliance with cGMPs in connection with the manufacture of our product candidates. If our contract manufacturers cannot successfully manufacture material that conforms to our specifications and the strict regulatory requirements of the FDA or others, they will not be able to pass regulatory inspections and/or maintain regulatory compliance for their manufacturing facilities. In addition, we have no control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and qualified personnel. If the FDA or a comparable foreign regulatory authority finds deficiencies with or does not approve these facilities for the manufacture of our product candidates or if it finds deficiencies or withdraws any such approval in the future, we may need to find alternative manufacturing facilities, which would significantly impact our ability to develop, obtain regulatory approval for or market our product candidates, if approved.

 

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If any contract manufacturing organization (“CMO”), with whom we contract fails to perform its obligations, we may be forced to enter into an agreement with a different CMO, which we may not be able to do on reasonable terms, if at all. In such scenario, our clinical trials supply could be delayed significantly as we establish alternative supply sources. In some cases, the technical skills required to manufacture our products or product candidates may be unique or proprietary to the original CMO and we may have difficulty, or there may be contractual restrictions prohibiting us from, transferring such skills to a back-up or alternate supplier, or we may be unable to transfer such skills at all. In addition, if we are required to change CMOs for any reason, we will be required to verify that the new CMO maintains facilities and procedures that comply with quality standards and with all applicable regulations. We will also need to verify, such as through a manufacturing comparability study, that any new manufacturing process will produce our product candidate according to the specifications previously submitted to the FDA or another regulatory authority. The delays associated with the verification of a new CMO could negatively affect our ability to develop product candidates or commercialize our products in a timely manner or within budget. Furthermore, a CMO may possess technology related to the manufacture of our product candidate that such CMO owns independently. This would increase our reliance on such CMO or require us to obtain a license from such CMO in order to have another CMO manufacture our product candidates. In addition, changes in manufacturers often involve changes in manufacturing procedures and processes, which could require that we conduct bridging studies between our prior clinical supply used in our clinical trials and that of any new manufacturer. We may be unsuccessful in demonstrating the comparability of clinical supplies which could require the conduct of additional clinical trials.

Further, our failure, or the failure of our third party manufacturers, to comply with applicable regulations could result in sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of product candidates or products, if approved, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect our business and supplies of our product candidates.

We may be unable to establish any agreements with third-party manufacturers or to do so on acceptable terms. Even if we are able to establish agreements with third-party manufacturers, reliance on third-party manufacturers entails additional risks, including:

 

   

reliance on the third party for regulatory compliance and quality assurance;

 

   

the possible breach of the manufacturing agreement by the third party;

 

   

the possible misappropriation of our proprietary information, including our trade secrets and know-how; and

 

   

the possible termination or nonrenewal of the agreement by the third party at a time that is costly or inconvenient for us.

Our product candidates and any products that we may develop may compete with other product candidates and approved products for access to manufacturing facilities. There are a limited number of manufacturers that operate under cGMP regulations and that might be capable of manufacturing for us.

Any performance failure on the part of our existing or future manufacturers could delay clinical development or marketing approval. If our current contract manufacturers cannot perform as agreed, we may be required to replace such manufacturers. We may incur added costs and delays in identifying and qualifying any such replacement.

Our current and anticipated future dependence upon others for the manufacture of our product candidates or products may adversely affect our future profit margins and our ability to commercialize any products that receive marketing approval on a timely and competitive basis.

 

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The manufacture of biologics is complex and our third-party manufacturers may encounter difficulties in production. If any of our third-party manufacturers encounter such difficulties, our ability to provide a supply of our current product candidates or any future product candidates for clinical trials or our products for patients, if approved, could be delayed or prevented.

Manufacturing biologics, especially in large quantities, is often complex and may require the use of innovative technologies to handle living cells. Each lot of an approved biologic must undergo thorough testing for identity, strength, quality, purity and potency. Manufacturing biologics requires facilities specifically designed for and validated for this purpose, and sophisticated quality assurance and quality control procedures are necessary. Slight deviations anywhere in the manufacturing process, including filling, labeling, packaging, storage and shipping and quality control and testing, may result in lot failures, product recalls or spoilage. When changes are made to the manufacturing process, we may be required to provide preclinical and clinical data showing the comparable identity, strength, quality, purity or potency of the products before and after such changes. If microbial, viral or other contaminations are discovered at the facilities of our manufacturers, such facilities may need to be closed for an extended period of time to investigate and remedy the contamination, which could delay clinical trials and adversely harm our business.

In addition, there are risks associated with large scale manufacturing for clinical trials or commercial scale including, among others, cost overruns, potential problems with process scale-up, process reproducibility, stability issues, compliance with good manufacturing practices, lot consistency and timely availability of raw materials. Even if we obtain marketing approval for any of our current product candidates or any future product candidates, there is no assurance that our manufacturers will be able to manufacture the approved product to specifications acceptable to the FDA or other comparable foreign regulatory authorities, to produce it in sufficient quantities to meet the requirements for the potential commercial launch of the product or to meet potential future demand. If our manufacturers are unable to produce sufficient quantities for clinical trials or for commercialization, our development and commercialization efforts would be impaired, which would have an adverse effect on our business, financial condition, results of operations and growth prospects.

The third parties upon whom we rely for the supply of the active pharmaceutical ingredients and drug product to be used the preclinical testing and clinical trials for our product candidates are currently our sole source of supply, and the loss of any of these suppliers could significantly harm our business.

The active pharmaceutical ingredients (“API”) and drug product we may use in all of our product candidates are currently supplied to us from single-source suppliers. Our ability to successfully develop our product candidates, and to ultimately supply our commercial products in quantities sufficient to meet the market demand, depends in part on our ability to obtain the API and drug product for these products in accordance with regulatory requirements and in sufficient quantities for clinical testing and commercialization. We are also unable to predict how changing global economic conditions or potential global health concerns such as the COVID-19 pandemic will affect our third-party suppliers and manufacturers. Any negative impact of such matters on our third-party suppliers and manufacturers may also have an adverse impact on our results of operations or financial condition.

For all of our product candidates, we intend to identify and qualify additional manufacturers to provide such API and drug product prior to submission of an application for approval with the FDA, EMA or other applicable regulatory authority. We are not certain, however, that our single-source suppliers will be able to meet our demand for their products, either because of the nature of our agreements with those suppliers, our limited experience with those suppliers or our relative importance as a customer to those suppliers. It may be difficult for us to assess their ability to timely meet our demand in the future based on past performance. While our suppliers have generally met our demand for their products on a timely basis in the past, they may subordinate our needs in the future to their other customers.

Establishing additional or replacement suppliers for the API and drug product used in our product candidates, if required, may not be accomplished quickly. If we are able to find a replacement supplier, such

 

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replacement supplier would need to be qualified and may require additional regulatory inspection or approval, which could result in further delay. While we seek to maintain adequate inventory of the API and drug product used in our product candidates, any interruption or delay in the supply of components or materials, or our inability to obtain such API and drug product from alternate sources at acceptable prices in a timely manner could impede, delay, limit or prevent our development efforts, which could harm our business, results of operations, financial condition and prospects.

Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates.

Until such time, if ever, as we can generate substantial revenue, we expect to finance our cash needs through a combination of private and public equity offerings, debt financings, collaborations, strategic alliances and licensing arrangements. Our future need for additional funding depends on many factors, including:

 

   

the scope, progress, results and costs of researching and developing our current product candidates, as well as other additional product candidates we may develop and pursue in the future;

 

   

the timing of, and the costs involved in, obtaining marketing approvals for our product candidates and any other additional product candidates we may develop and pursue in the future;

 

   

the number of future product candidates that we may pursue and their development requirements;

 

   

the costs of commercialization activities for our product candidates, to the extent such costs are not the responsibility of any current or future collaborators, including the costs and timing of establishing product sales, marketing, distribution and manufacturing capabilities;

 

   

subject to receipt of regulatory approval, revenue, if any, received from commercial sales of our product candidates or any other additional product candidates we may develop and pursue in the future;

 

   

the extent to which we in-license or acquire rights to other products, product candidates or technologies;

 

   

our ability to establish collaboration arrangements for the development of our product candidates on favorable terms, if at all;

 

   

our headcount growth and associated costs as we expand our research and development and establish a commercial infrastructure;

 

   

the costs of preparing, filing and prosecuting patent applications, maintaining and protecting our intellectual property rights, including enforcing and defending intellectual property related claims; and

 

   

the costs of operating as a public company.

The terms of any financing may adversely affect the holdings or the rights of our stockholders and the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our securities to decline. To the extent that we raise additional capital through the sale of common stock or securities convertible or exchangeable into common stock, your ownership interest may be diluted, and the terms of those securities may include liquidation or other preferences that may adversely affect your rights as a common stockholder. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, acquiring, selling or licensing intellectual property rights, and making capital expenditures, declaring dividends or other operating restrictions that could adversely impact our ability to conduct our business. We could also be required to meet certain milestones in connection with debt financing and the failure to achieve such milestones by certain dates may force us to relinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to us which could have a material adverse effect on our business, operating results and prospects.

 

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We also could be required to seek funds through arrangements with additional collaborators. If we raise funds through additional collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our intellectual property, future revenue streams, research programs or product candidates, grant licenses on terms that may not be favorable to us or grant rights to develop and market our product candidates that we would otherwise prefer to develop and market ourselves, any of which may have a material adverse effect on our business, operating results and prospects.

Risks Related to Comera’s Intellectual Property

Unless the context otherwise requires, all references in this “Risks Related to Comera’s Intellectual Property” section to “we,” “us,” “our,” or the “Company” refer to Comera Life Sciences, Inc. prior to the consummation of the Business Combination.

If we are unable to obtain and maintain patent and other intellectual property protection for our technology and product candidates or if the scope of the intellectual property protection obtained is not sufficiently broad or we are delayed in bringing product candidates to market such that those products have a shorter period of patent exclusivity than we expect, our competitors could develop and commercialize technology and drugs similar or identical to ours, and our ability to successfully commercialize our technology and drugs may be impaired.

Our commercial success depends in part on our ability to obtain and maintain proprietary or intellectual property protection in the United States and other countries for our current and future product candidates, as well as for their respective compositions, formulations, methods used to manufacture them, and methods of treatment, in addition to successfully defending these patents against third-party challenges. We seek to protect our proprietary and intellectual property position by, among other methods, filing patent applications in the United States and abroad related to our proprietary technology, inventions, and improvements that are important to the development and implementation of our business. Our ability to stop unauthorized third parties from making, using, selling, offering to sell, or importing our product candidates is dependent upon the extent to which we have rights under valid and enforceable patents or trade secrets that cover these activities. We also rely on trade secrets, know-how and continuing technological innovation to develop and maintain our proprietary and intellectual property position.

The patent position of biotechnology and pharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has in recent years been the subject of much litigation. The degree of patent protection we require to successfully commercialize our current and future product candidates may be unavailable or severely limited in some cases and may not adequately protect our rights or permit us to gain or keep any competitive advantage. We cannot provide any assurances that any of our patents have, or that any of our pending patent applications that mature into issued patents will include, claims with a scope sufficient to protect our current or future product candidates. In addition, if the breadth or strength of protection provided by our patent applications or any patents we may own or in-license is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize current or future product candidates.

In addition, the laws of foreign countries may not protect our rights to the same extent as the laws of the United States. For example, in jurisdictions outside the United States, a license may not be enforceable unless all the owners of the intellectual property agree or consent to the license. Accordingly, any actual or purported co-owner of our patent rights could seek monetary or equitable relief requiring us to pay it compensation for, or refrain from, exploiting these patents due to such co-ownership.

Furthermore, patents have a limited lifespan. In the United States, and most other jurisdictions in which we have undertaken patent filings, the natural expiration of a patent is generally 20 years after it is filed, assuming all maintenance fees are paid. Various extensions may be available, on a jurisdiction-by-jurisdiction basis; however, the life of a patent, and thus the protection it affords, is limited. In the United States, depending upon

 

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the timing, duration, and specifics of any FDA marketing approval of a product candidate, the patent term of a patent that covers an FDA-approved product may be eligible for limited patent term extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory review process. The Drug Price Competition and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act, permits a patent term extension of up to five (5) years beyond the expiration of the patent. While, in the future, if and when our product candidates receive FDA approval, we expect to apply for patent term extensions on patents directed to those candidates, there is no guarantee that the applicable authorities will agree with our assessment of whether such extensions should be granted, and even if granted, the length of such extensions. We may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of the relevant patents, or otherwise failing to satisfy applicable requirements. Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized. As a result, patents we may own or in-license may not provide us with adequate and continuing patent protection sufficient to exclude others from commercializing drugs similar or identical to our current or future product candidates, including generic versions of such drugs.

Other parties have developed technologies that may be related or competitive to our own, and such parties may have filed or may file patent applications, or may have received or may receive patents, claiming inventions that may overlap or conflict with those claimed in our own patent applications or issued patents, with respect to either the same compounds, methods, formulations or other subject matter, in either case that we may rely upon to dominate our patent position in the market. Publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until at least 18 months after the earliest priority date of patent filing, or, in some cases, not at all. Therefore, we cannot know with certainty whether we were the first to make the inventions claimed in patents we may own or in-license patents or pending patent applications, or that we were the first to file for patent protection of such inventions. As a result, the issuance, scope, validity, enforceability and commercial value of our patent rights cannot be predicted with any certainty.

In addition, the patent prosecution process is expensive and time-consuming, and we may not be able to file and prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner. Further, with respect to certain pending patent applications covering our current or future product candidates, prosecution has yet to commence. Patent prosecution is a lengthy process, during which the scope of the claims initially submitted for examination by the relevant patent office(s) may be significantly narrowed by the time they issue, if they ever do. It is also possible that we will fail to identify patentable aspects of our research and development output before it is too late to obtain patent protection. Moreover, in some circumstances, we may not have the right to control the preparation, filing and prosecution of patent applications, or to maintain the patents, covering technology that we license from or to third parties. Therefore, these patents and applications may not be prosecuted and enforced in a manner consistent with the best interests of our business.

Even if we acquire patent protection that we expect should enable us to establish and/or maintain a competitive advantage, third parties may challenge the validity, enforceability or scope thereof, which may result in such patents being narrowed, invalidated or held unenforceable. The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our patents may be challenged in the courts or patent offices in the United States and abroad. We may become involved in post-grant proceedings such as opposition, derivation, reexamination, inter partes review, post-grant review, or interference proceedings challenging our patent rights or the patent rights of others from whom we may in the future obtain licenses to such rights, in the U.S. Patent and Trademark Office (the “USPTO”) the European Patent Office (the “EPO”), or in other countries. In addition, we may be subject to a third-party submission to the USPTO, the EPO, or elsewhere, that may reduce the scope or preclude the granting of claims from our pending patent applications. Competitors may allege that they invented the inventions claimed in our issued patents or patent applications prior to us, or may file patent applications before we do. Competitors may also claim that we are infringing their patents and that we therefore

 

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cannot practice our technology as claimed under our patents or patent applications. Competitors may also contest our patents by claiming to an administrative patent authority or judge that the invention was not patent-eligible, was not original, was not novel, was obvious, and/or lacked inventive step, and/or that the patent application filing failed to meet relevant requirements relating to description, basis, enablement, and/or support. In litigation, a competitor could claim that our patents, if issued, are not valid or are unenforceable for a number of reasons. If a court or administrative patent authority agrees, we would lose our protection of those challenged patents.

In addition, we may in the future be subject to claims by our former employees or consultants asserting an ownership right in our patents or patent applications, as a result of the work they performed on our behalf. Although we generally require all of our employees, consultants and advisors and any other third parties who have access to our proprietary know-how, information or technology to assign or grant similar rights to their inventions to us, we cannot be certain that we have executed such agreements with all parties who may have contributed to our intellectual property, nor can we be certain that our agreements with such parties will be upheld in the face of a potential challenge, or that they will not be breached, for which we may not have an adequate remedy.

An adverse determination in any such submission or proceeding may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing similar or identical technology and drugs, without payment to us, or could limit the duration of the patent protection covering our technology and current and future product candidates. Such challenges may also result in our inability to manufacture or commercialize our current and future product candidates without infringing third-party patent rights. In addition, if the breadth or strength of protection provided by our patents and patent applications is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize current or future product candidates.

Even if they are unchallenged, our issued patents and our pending patent applications, if issued, may not provide us with any meaningful protection or prevent competitors from designing around our patent claims to circumvent patents we may own or in-license by developing similar or alternative technologies or drugs in a non-infringing manner. For example, a third-party may develop a competitive drug that provides benefits similar to one or more of our current or future product candidates but that has a different composition or dosage that falls outside the scope of our patent protection. If the patent protection provided by the patents and patent applications we hold or pursue with respect to our current or future product candidates is not sufficiently broad to impede such competition, our ability to successfully commercialize our current and future product candidates could be negatively affected, which would harm our business, operating results, financial condition and prospects.

Furthermore, even if we are able to issue patents with claims of valuable scope in one or more jurisdictions, we may not be able to secure such claims in all relevant jurisdictions, or in a sufficient number to meaningfully reduce competition. Our competitors may be able to develop and commercialize their products, including products identical to ours, in any jurisdiction in which we are unable to obtain, maintain, or enforce such patent claims.

Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, deadlines, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated if we fail to comply with these requirements. We may miss a filing deadline for patent protection on these inventions.

The USPTO and foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process and after issuance of any patent. In addition, periodic maintenance fees, renewal fees, annuity fees and/or various other government fees are required to be paid periodically. While an inadvertent lapse can, in some cases, be cured by payment of a late fee, or by other means in accordance with the applicable rules, there are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of

 

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patent rights in the relevant jurisdiction. Noncompliance events that could result in abandonment or lapse of a patent include, but are not limited to, failure to respond to official actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents. In such an event, our competitors might be able to enter the market with similar or identical products or platforms, which could have a material adverse effect on our business prospects and financial condition.

If our trademarks and trade names for our products or company name are not adequately protected in one or more countries where we intend to market our products, we may delay the launch of product brand names, use different trademarks or tradenames in different countries, or face other potentially adverse consequences to building our product brand recognition.

Our trademarks or trade names may be challenged, infringed, diluted, circumvented or declared generic or determined to be infringing on other marks. We intend to rely on both registration and common law protection for our trademarks. We may not be able to protect our rights to these trademarks and trade names or may be forced to stop using these names, which we need for name recognition by potential partners or customers in our markets of interest. During the trademark registration process, we may receive Office Actions from the USPTO or from comparable agencies in foreign jurisdictions objecting to the registration of our trademark. Although we would be given an opportunity to respond to those objections, we may be unable to overcome such rejections. In addition, in the USPTO and in comparable agencies in many foreign jurisdictions, third parties are given an opportunity to oppose pending trademark applications and/or to seek the cancellation of registered trademarks. Opposition or cancellation proceedings may be filed against our trademark applications or registrations, and our trademark applications or registrations may not survive such proceedings. If we are unable to obtain a registered trademark or establish name recognition based on our trademarks and trade names, we may not be able to compete effectively and our business may be adversely affected.

If we are unable to adequately protect and enforce our trade secrets, our business and competitive position would be harmed.

In addition to the protection afforded by patents we may own or in-license, we seek to rely on trade secret protection, confidentiality agreements, and partnership and license agreements to protect proprietary know-how that may not be patentable, processes for which patents are difficult to enforce and any other elements of our product discovery and development processes or our business processes that involve proprietary know-how, information, or technology that may not be covered by patents. Although we require all of our employees, consultants, advisors, and any third parties who have access to our proprietary know-how, information, or technology to enter into confidentiality agreements, trade secrets can be difficult to protect and we have limited control over the protection of trade secrets used by our collaborators and suppliers. We cannot be certain that we have or will obtain these agreements in all circumstances and we cannot guarantee that we have entered into such agreements with each party that may have or have had access to our trade secrets or proprietary information.

Moreover, any of these parties might breach the agreements and intentionally or inadvertently disclose our trade secret information and we may not be able to obtain adequate remedies for such breaches. In addition, competitors may otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques. Furthermore, the laws of some foreign countries do not protect proprietary rights and trade secrets to the same extent or in the same manner as the laws of the United States. As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. If we are unable to prevent unauthorized material disclosure of our intellectual property and trade secrets to third parties, we will not be able to establish or maintain a competitive advantage in our market, which could adversely affect our business, financial condition, results of operations and future prospects.

Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming, and the outcome is unpredictable. If we choose to go to court to stop a third-party from using any of our trade secrets, we may incur substantial costs. These lawsuits may consume our time and other

 

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resources even if we are successful. Although we take steps to protect our proprietary information and trade secrets, including through contractual means with our employees and consultants, third parties may independently develop substantially equivalent proprietary information and techniques or otherwise gain access to our trade secrets or disclose our technology. If any of our trade secrets were to be lawfully obtained or independently developed by a competitor or other third-party, we would have no right to prevent them from using that technology or information to compete with us.

Thus, we may not be able to meaningfully protect our trade secrets. It is our policy to require our employees, consultants, outside scientific collaborators, sponsored researchers and other advisors to execute confidentiality agreements upon the commencement of employment or consulting relationships with us. These agreements provide that all confidential information concerning our business or financial affairs developed or made known to the individual or entity during the course of the party’s relationship with us is to be kept confidential and not disclosed to third parties except in specific circumstances. In addition, we take other appropriate precautions, such as physical and technological security measures, to guard against misappropriation of our proprietary technology by third parties. In the case of employees, the proprietary information and inventions assignment agreements with employees provide that the employees shall assign and transfer, and will assign and transfer, to us the rights, title, and interest in all inventions that (a) relate to our business or that of our affiliates, our customers or suppliers, or any of the products or services being researched, developed or sold by us or our affiliates; (b) result from tasks assigned by us; or (c) result from the use of our premises or personal property. Although we require all of our employees to assign their inventions to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that we regard as our own. The assignment of intellectual property rights may not be self-executing, or the assignment agreements may be breached, and we may be forced to bring claims against third parties, or defend claims that they may bring against us, to determine the ownership of what we regard as our intellectual property. Such claims could have a material adverse effect on our business, financial condition, results of operations, and prospects.

We may initiate, become a defendant in, or otherwise become party to lawsuits to protect or enforce our intellectual property rights, which could be expensive, time-consuming, and unsuccessful.

There is considerable patent and other intellectual property litigation in the pharmaceutical and biotechnology industries. We may become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our technology and product candidates, including interference proceedings, post grant review, inter parties review, and derivation proceedings before the USPTO and similar proceedings in foreign jurisdictions such as oppositions before the European Patent Office.

Competitors may infringe any patents we may own or in-license. In addition, any patents we may own or in-license also may become involved in inventorship, priority, validity or unenforceability disputes. To counter infringement or unauthorized use, we may be required to file infringement claims, which can be expensive and time-consuming. Any claims we assert against perceived infringers could provoke such parties to assert counterclaims against us alleging that we infringe, misappropriate or otherwise violate their intellectual property. In addition, in a patent infringement proceeding, such parties could counterclaim that the patents we or our licensors have asserted are invalid or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness, or non-enablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld relevant information from the USPTO, or made a misleading statement, during prosecution. Third parties may institute such claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include re-examination, post-grant review, inter parties review, interference proceedings, derivation proceedings, and equivalent proceedings in foreign jurisdictions (e.g., opposition proceedings). We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful. In addition, in an infringement proceeding, a

 

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court may decide that one or more of any patents we may own or in-license is not valid or is unenforceable or that the other party’s use of our technology that may be patented falls under the safe harbor to patent infringement under 35 U.S.C. § 271(e)(1). There is also the risk that, even if the validity of these patents is upheld, the court may refuse to stop the other party from using the technology at issue on the grounds that any patents we may own or in-license do not cover the technology in question or that such third-party’s activities do not infringe our patent applications or any patents we may own or in-license.

Even if we believe that third-party intellectual property claims are without merit, there is no assurance that a court would find in our favor on questions of misappropriation, infringement, validity, enforceability, or priority. A court of competent jurisdiction could hold these third-party patents are valid, enforceable, and infringed, which could materially and adversely affect our ability to commercialize any technology or product candidate covered by the asserted third-party patents. In order to successfully challenge the validity of any such U.S. patent in federal court, we would need to overcome a presumption of validity. As this burden is a high one requiring us to present clear and convincing evidence as to the invalidity of any such U.S. patent claim, there is no assurance that a court of competent jurisdiction would invalidate the claims of any such U.S. patent. Conversely, an adverse result in any litigation or defense proceedings could put one or more of any patents we may own or in-license at risk of being invalidated, held unenforceable, or interpreted narrowly and could put our patent applications at risk of not issuing.

Post-grant proceedings provoked by third-parties or brought by the USPTO may be necessary to determine the validity or priority of inventions with respect to our patent applications or any patents we may own or in-license. These proceedings are expensive and an unfavorable outcome could result in a loss of our current patent rights and could require us to cease using the related technology or to attempt to license rights to it from the prevailing party. Our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms. In addition to potential USPTO post-grant proceedings, we may become a party to patent opposition proceedings in the EPO, or similar proceedings in other foreign patent offices or courts where our patents may be challenged. The costs of these proceedings could be substantial, and may result in a loss of scope of some claims or a loss of the entire patent. An unfavorable result in a post-grant challenge proceeding may result in the loss of our right to exclude others from practicing one or more of our inventions in the relevant country or jurisdiction, which could have a material adverse effect on our business. Litigation or post-grant proceedings within patent offices may result in a decision adverse to our interests and, even if we are successful, may result in substantial costs and distract our management and other employees. We may not be able to prevent misappropriation of our trade secrets or confidential information, particularly in countries where the laws may not protect those rights as fully as in the United States.

Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments. If securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our securities.

We may not be able to detect infringement against any patents we may own or in-license. Even if we detect infringement by a third-party of any patents we may own or in-license, we may choose not to pursue litigation against or settlement with the third-party. If we later sue such third-party for patent infringement, the third-party may have certain legal defenses available to it, which otherwise would not be available except for the delay between when the infringement was first detected and when the suit was brought. Such legal defenses may make it impossible for us to enforce any patents we may own or in-license against such third-party.

Intellectual property litigation and administrative patent office patent validity challenges in one or more countries could cause us to spend substantial resources and distract our personnel from their normal responsibilities.

The legal threshold for initiating litigation or contested proceedings is low, so that even lawsuits or proceedings with a low probability of success might be initiated and require significant resources to defend. The

 

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risks of being involved in such litigation and proceedings may increase if and as our product candidates near commercialization and as we gain the greater visibility associated with being a public company. Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses, and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our securities. Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing, patient support or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately. As noted above, some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could compromise our ability to compete in the marketplace, including compromising our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties, or enter into development collaborations that would help us commercialize our current or future product candidates, if approved. Any of the foregoing events would harm our business, financial condition, results of operations and prospects.

We may not be able to protect our intellectual property and proprietary rights throughout the world.

We may be unable to obtain patent or other intellectual property protection for our current or future product candidates or our future products, if any, in all jurisdictions throughout the world, and we may not be able to adequately enforce our intellectual property rights even in the jurisdictions where we seek protection.

We may not be able to pursue patent coverage of our current or future product candidates in all countries. Filing, prosecuting and defending patents on current or future product candidates in all countries throughout the world would be prohibitively expensive, and intellectual property rights in some countries outside the United States can be less extensive than those in the United States. In addition, the laws of some foreign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States. Consequently, we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and further, may export otherwise infringing products to territories where we have patent protection, but where enforcement is not as strong as that in the United States. These products may compete with our current or future product candidates and in jurisdictions where we do not have any issued patents our patent applications or other intellectual property rights may not be effective or sufficient to prevent them from competing. We will need to decide whether and in which jurisdictions to pursue protection for the various inventions in our portfolio prior to applicable deadlines.

Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets and other intellectual property protection, particularly those relating to pharmaceutical products, which could make it difficult for us to stop the infringement of any patents we may own or in-license or marketing of competing products in violation of our proprietary rights generally. Proceedings to enforce any rights we may have in our patent applications or any patents we may own or in-license in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put any patents we may own or in-license at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license.

 

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Many countries have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In addition, many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of such patent. If we are forced to grant a license to third parties with respect to any patents we may own or license that are relevant to our business, our competitive position may be impaired, and our business, financial condition, results of operations, and prospects may be adversely affected.

If we fail to comply with our obligations in any agreements under which we may license intellectual property rights from third parties or otherwise experience disruptions to our business relationships with our licensors, we could lose license rights that are important to our business.

We may from time to time be party to license, funding and collaboration agreements with third parties to advance our research or allow commercialization of current or future product candidates. Such agreements may impose numerous obligations, such as development, diligence, payment, commercialization, funding, milestone, royalty, sublicensing, insurance, patent prosecution, enforcement and other obligations on us and may require us to meet development timelines, or to exercise commercially reasonable efforts to develop and commercialize licensed products, in order to maintain the licenses. If we fail to comply with such obligations, our counterparties might therefore terminate the license, funding or collaboration agreements or require us to grant them certain rights, thereby removing or limiting our ability to develop and commercialize products and technologies covered by these agreements.

Any termination of these may result in our having to negotiate new or reinstated agreements with less favorable terms, or cause us to lose our rights under those agreements, including our rights to important intellectual property or technology, which could harm our ability to commercialize our current or future product candidates. Any of the foregoing could have a material adverse effect on our competitive position, business, financial conditions, results of operations, and prospects.

Additionally, these and other license agreements may not provide exclusive rights to use the licensed intellectual property and technology in all relevant fields of use and in all territories in which we may wish to develop or commercialize our technology and drugs in the future. As a result, we may not be able to prevent competitors from developing and commercializing competitive products and technology in fields of use and territories not included in enforcement, and defense of patents and patent applications directed to the technology that we license from third parties. Therefore, we cannot be certain that these patents and patent applications will be prepared, filed, prosecuted, maintained, and defended in a manner consistent with the best interests of our business. If our licensors fail to prosecute, maintain, enforce, and defend such patents, or lose rights to those patents or patent applications, the rights we have licensed may be reduced or eliminated, and our right to develop and commercialize any of our drugs that are the subject of such licensed rights could be adversely affected.

We may need to obtain additional licenses from others to advance our research or allow commercialization of our therapeutic candidates. It is possible that we may be unable to obtain additional licenses at a reasonable cost or on reasonable terms, if at all, or such licenses may be non-exclusive. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive or necessary. These established companies may have a competitive advantage over us due to their size, capital resources and greater clinical development and commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. We also may be unable to license or acquire third-party intellectual property rights on terms that would allow us to make an appropriate return on our investment or at all.

If we are unable to obtain rights to required third-party intellectual property rights or maintain the existing intellectual property rights we have, we may be required to expend significant time and resources to redesign our technology, therapeutic candidates, or the methods for manufacturing them or to develop or license replacement

 

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technology, all of which may not be feasible on a technical or commercial basis. If we are unable to do so, we may be unable to develop or commercialize the affected technology and therapeutic candidates, which could harm our business, financial condition, results of operations, and prospects significantly.

Our licensors may have relied on third-party consultants or collaborators or on funds from third parties such that our licensors are not the sole and exclusive owners of the patents and patent applications we in-licensed. If other third parties have ownership rights to our in-licensed patents, they may be able to license such patents to our competitors, and our competitors could market competing products and technology. This could have a material adverse effect on our competitive position, business, financial conditions, results of operations, and prospects.

Disputes may also arise between us and our licensors regarding intellectual property subject to a license agreement, including:

 

   

the scope of rights granted under the license agreement and other interpretation-related issues;

 

   

whether and the extent to which our technology and processes infringe, misappropriate or otherwise violate intellectual property rights of the licensor that is not subject to the licensing agreement;

 

   

our right to sublicense patent and other rights to third parties under collaborative development relationships;

 

   

our diligence obligations with respect to the use of the licensed technology in relation to our development and commercialization of our current or future product candidates, and what activities satisfy those diligence obligations;

 

   

the priority of invention of any patented technology; and

 

   

the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our future licensors and us and our partners.

In addition, the agreements under which we may license intellectual property or technology from third parties are likely to be complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations and prospects. Moreover, if disputes over intellectual property that we may license prevent or impair our ability to maintain future licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize the affected current or future product candidates, which could have a material adverse effect on our business, financial conditions, results of operations and prospects.

We may be subject to claims that our employees or consultants have wrongfully used or disclosed alleged trade secrets.

As is common in the biotechnology and pharmaceutical industries, we employ individuals who were previously employed at other biotechnology or pharmaceutical companies, including our competitors or potential competitors. Although we try to ensure that our employees and consultants do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or our employees or consultants have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of their former employers. Litigation may be necessary to defend against these claims. If we fail in defending any such claims, in addition to paying monetary damages, we could lose valuable intellectual property rights or personnel, which could adversely impact our business. Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management.

 

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Any granted patents we may own or in-license covering our product candidates or other valuable technology could be narrowed or found invalid or unenforceable if challenged in court or before administrative bodies in the United States or abroad, including the USPTO and the EPO. A patent asserted in a judicial court could be found invalid or unenforceable during the enforcement proceeding. Administrative or judicial proceedings challenging the validity of our patents or individual patent claims could take months or years to resolve.

If we or our licensors or strategic partners initiate legal proceedings against a third-party to enforce a patent covering one of our current or future product candidates, the defendant could counterclaim that the patent covering our product candidate, as applicable, is invalid and/or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity and/or unenforceability are commonplace, and there are numerous grounds upon which a third-party can assert invalidity or unenforceability of a patent. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of patentable subject matter, lack of written description, lack of novelty, obviousness, or non-enablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld relevant information from the USPTO, or made a misleading statement, in the process of obtaining the patent during patent prosecution. Third parties may also raise similar claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include re-examination, inter partes review, post grant review and equivalent proceedings in foreign jurisdictions (such as opposition proceedings). Such proceedings could result in revocation or amendment to our patent applications or any patents we may own or in-license in such a way that they no longer cover our current or future product candidates. The outcome following legal assertions of invalidity and unenforceability is unpredictable. An adverse determination in any such submission, proceeding or litigation could reduce the scope of, or invalidate or render unenforceable, any rights we may have from our patent applications or any patents we may own or in-license, allow third parties to commercialize our current or future product candidates or other technologies and compete directly with us, without payment to us, or result in our inability to manufacture or commercialize products without infringing third-party patent rights. Moreover, we may have to participate in interference proceedings declared by the USPTO to determine priority of invention or in post-grant challenge proceedings, such as oppositions in a foreign patent office, that challenge our or our future licensors’ priority of invention or other features of patentability with respect to our patent applications and any patents we may own or in-license. Such challenges may result in loss of patent rights, loss of exclusivity, or in patent claims being narrowed, invalidated, or held unenforceable, which could limit our ability to stop others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our current or future product candidates and other technologies. With respect to the validity question, for example, we cannot be certain that there is no invalidating prior art, of which we or our future licensing partners and the patent examiner were unaware during prosecution. If a defendant were to prevail on a legal assertion of invalidity and/or unenforceability, or if we are otherwise unable to adequately protect our rights, we would lose at least part, and perhaps all, of the patent protection on our current or future product candidates. Such a loss of patent protection could have a material adverse impact on our business and our ability to commercialize or license our technology and current or future product candidates.

Such proceedings also may result in substantial cost and require significant time from our scientists and management, even if the eventual outcome is favorable to us. If we are unsuccessful in any such proceeding or other priority or inventorship dispute, we may be required to obtain and maintain licenses from third parties, including parties involved in any such interference proceedings or other priority or inventorship disputes. Such licenses may not be available on commercially reasonable terms or at all, or may be non-exclusive. If we are unable to obtain and maintain such licenses, we may need to cease the development, manufacture, and commercialization of one or more of the current or future product candidates we may develop. The loss of exclusivity or the narrowing of our patent application claims could limit our ability to stop others from using or commercializing similar or identical technology and products. Any of the foregoing could have a material adverse effect on our business, results of operations, financial condition and prospects.

 

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Changes in patent law could diminish the value of patents in general, thereby impairing our ability to protect our current or future product candidates.

As is the case with other biopharmaceutical companies, our success is heavily dependent on intellectual property, particularly patents. Obtaining and enforcing patents in the biopharmaceutical industry involve both technological and legal complexity and is therefore costly, time consuming and inherently uncertain. Recent patent reform legislation in the United States and other countries, including the Leahy-Smith America Invents Act, or Leahy-Smith Act, signed into law on September 16, 2011, could increase the uncertainties and costs surrounding the prosecution of our owned and in-licensed patent applications and the maintenance, enforcement or defense of our owned and in-licensed issued patents. The Leahy-Smith Act includes a number of significant changes to U.S. patent law. These include provisions that affect the way patent applications are prosecuted, redefine prior art and provide more efficient and cost-effective avenues for competitors to challenge the validity of patents, and enable third-party submission of prior art to the USPTO during patent prosecution and additional procedures to attack the validity of a patent at USPTO-administered post-grant proceedings, including post-grant review, inter parties review, and derivation proceedings. In addition, the Leahy-Smith Act has transformed the U.S. patent system into a “first inventor to file” system. The first-inventor-to-file provisions, however, only became effective on March 16, 2013. However, the Leahy-Smith Act and its implementation could make it more difficult to obtain patent protection for our inventions and increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents, all of which could harm our business, operating results, financial condition and prospects.

The U.S. Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. This combination of events has created uncertainty with respect to the validity and enforceability of patents once obtained. Additionally, there have been recent proposals for additional changes to the patent laws of the United States and other countries that, if adopted, could impact our ability to obtain patent protection for our proprietary technology or our ability to enforce our proprietary technology. Depending on future actions by the U.S. Congress, the U.S. courts, the USPTO and the relevant law-making bodies in other countries, the laws and regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce our existing patents and patents that we might obtain in the future.

We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent, which might subject us to infringement claims or adversely affect our ability to develop and market our current or future product candidates.

We cannot guarantee that any of our or our licensors’ patent searches or analyses, including the identification of relevant patents, the scope of patent claims or the expiration of relevant patents, are complete or thorough, nor can we be certain that we have identified each and every third-party patent and pending patent application in the United States and abroad that is relevant to or necessary for the commercialization of our current or future product candidates in any jurisdiction. For example, U.S. patent applications filed before November 29, 2000 and certain U.S. patent applications filed after that date that will not be filed outside the United States remain confidential until patents issue. As mentioned previously, patent applications in the United States and elsewhere are published approximately 18 months after the earliest filing for which priority is claimed, with such earliest filing date being commonly referred to as the priority date. Therefore, patent applications covering our current or future product candidates could have been filed by third parties without our knowledge. Additionally, pending patent applications that have been published can, subject to certain limitations, be later amended in a manner that could cover our current or future product candidates or the use of our current or future product candidates. The scope of a patent claim is determined by an interpretation of the law, the written disclosure in a patent and the patent’s prosecution history. Our interpretation of the relevance or the scope of a patent or a pending application may be incorrect, which may negatively impact our ability to market our current or future product candidates. We may incorrectly determine that our current or future product candidates are not covered by a third-party patent or may incorrectly predict whether a third party’s pending application will issue

 

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with claims of relevant scope. Our determination of the expiration date of any patent in the United States or abroad that we consider relevant may be incorrect, which may negatively impact our ability to develop and market our current or future product candidates. Our failure to identify and correctly interpret relevant patents may negatively impact our ability to develop and market our current or future product candidates.

If we fail to identify and correctly interpret relevant patents, we may be subject to infringement claims. We cannot guarantee that we will be able to successfully settle or otherwise resolve such infringement claims. If we fail in any such dispute, in addition to being forced to pay damages, which may be significant, we may be temporarily or permanently prohibited from commercializing any of our current or future product candidates that are held to be infringing. We might, if possible, also be forced to redesign current or future product candidates so that we no longer infringe the third-party intellectual property rights. Any of these events, even if we were ultimately to prevail, could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business and could adversely affect our business, financial condition, results of operations and prospects.

Intellectual property rights do not guarantee commercial success of current or future product candidates or other business activities. Numerous factors may limit any potential competitive advantage provided by our intellectual property rights.

The degree of future protection afforded by our intellectual property rights, whether owned or in-licensed, is uncertain because intellectual property rights have limitations, and may not adequately protect our business, provide a barrier to entry against our competitors or potential competitors, or permit us to maintain our competitive advantage. Moreover, if a third-party has intellectual property rights that cover the practice of our technology, we may not be able to fully exercise or extract value from our intellectual property rights. The following examples are illustrative:

 

   

patent applications that we own or may in-license may not lead to issued patents;

 

   

patents, should they issue, that we may own or in-license, may not provide us with any competitive advantages, may be narrowed in scope, or may be challenged and held invalid or unenforceable;

 

   

others may be able to develop and/or practice technology, including excipients that are similar to the chemical compositions of our current or future product candidates, that is similar to our technology or aspects of our technology but that is not covered by the claims of any patents we may own or in-license, should any patents issue;

 

   

third parties may compete with us in jurisdictions where we do not pursue and obtain patent protection;

 

   

we, or our licensors or collaborators, might not have been the first to make the inventions covered by a patent application that we own or may in-license;

 

   

we, or our licensors or collaborators, might not have been the first to file patent applications covering a particular invention;

 

   

others may independently develop similar or alternative technologies without infringing, misappropriating or otherwise violating our intellectual property rights;

 

   

our competitors might conduct research and development activities in the United States and other countries that provide a safe harbor from patent infringement claims for certain research and development activities, as well as in countries where we do not have patent rights, and may then use the information learned from such activities to develop competitive products for sale in our major commercial markets;

 

   

we may not be able to obtain and/or maintain necessary licenses on reasonable terms or at all;

 

   

third parties may assert an ownership interest in our intellectual property and, if successful, such disputes may preclude us from exercising exclusive rights, or any rights at all, over that intellectual property;

 

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we may choose not to file a patent in order to maintain certain trade secrets or know-how, and a third-party may subsequently file a patent covering such trade secrets or know-how;

 

   

we may not be able to maintain the confidentiality of our trade secrets or other proprietary information;

 

   

we may not develop or in-license additional proprietary technologies that are patentable; and

 

   

the patents of others may have an adverse effect on our business.

Should any of these events occur, they could significantly harm our business, financial condition, results of operations and prospects.

Risks Related to Government Regulation

Unless the context otherwise requires, all references in this “Risks Related to Government Regulation” section to “we,” “us,” “our,” or the “Company” refer to Comera Life Sciences, Inc. prior to the consummation of the Business Combination.

Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our product candidates in other jurisdictions.

We may also submit marketing applications in other countries. Regulatory authorities in jurisdictions outside of the United States have requirements for approval of product candidates with which we must comply prior to marketing in those jurisdictions. Obtaining foreign regulatory approvals and compliance with foreign regulatory requirements could result in significant delays, difficulties and costs for us and could delay or prevent the introduction of our products in certain countries. If we fail to comply with the regulatory requirements in international markets and/or receive applicable marketing approvals, our target market will be reduced and our ability to realize the full market potential of our product candidates will be harmed.

Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not guarantee that we will be able to obtain or maintain regulatory approval in any other jurisdiction, while a failure or delay in obtaining regulatory approval in one jurisdiction may have a negative effect on the regulatory approval process in others. For example, even if the FDA grants marketing approval of a product candidate, comparable regulatory authorities in foreign jurisdictions must also approve the manufacturing, marketing and promotion of the product candidate in those countries. Approval procedures vary among jurisdictions and can involve requirements and administrative review periods different from, and greater than, those in the United States, including additional nonclinical studies or clinical trials as clinical trials conducted in one jurisdiction may not be accepted by regulatory authorities in other jurisdictions. In short, the foreign regulatory approval process involves all of the risks associated with FDA approval. In many jurisdictions outside the United States, a product candidate must be approved for reimbursement before it can be approved for sale in that jurisdiction. In some cases, the price that we may intend to charge for our products will also be subject to approval.

Our product candidates may be subject to government price controls in certain jurisdictions that may affect our revenue.

There has been heightened governmental scrutiny in the United States, China, the European Union, Japan and other jurisdictions of pharmaceutical pricing practices in light of the rising cost of prescription drugs. In the United States, such scrutiny has resulted in several recent Congressional inquiries and proposed and enacted federal legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products. At the federal level, Congressional leadership and the Biden administration have each indicated that they will continue to seek new legislative and/or administrative measures to control drug costs. At the state level, legislatures have increasingly enacted legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

 

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Outside of the United States, particularly in the European Union, the pricing of prescription pharmaceuticals is subject to governmental control. In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product. To obtain coverage and reimbursement or pricing approval in some countries, we may be required to conduct a clinical trial that compares the cost-effectiveness of our product candidate to other available therapies. If reimbursement of our products is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, our business could be harmed.

We may seek priority review designation for one or more of our product candidates, but we might not receive such designation, and even if we do, such designation may not lead to a faster regulatory review or approval process.

If the FDA determines that a product candidate offers a treatment for a serious condition and, if approved, the product would provide a significant improvement in safety or effectiveness, the FDA may designate the product candidate for priority review. A priority review designation means that the goal for the FDA to review an application is six months, rather than the standard review period of ten months. We may request priority review for some of our product candidates. The FDA has broad discretion with respect to whether or not to grant priority review status to a product candidate, so even if we believe a particular product candidate is eligible for such designation or status, the FDA may decide not to grant it. Moreover, a priority review designation does not necessarily result in an expedited regulatory review or approval process or necessarily confer any advantage with respect to approval compared to conventional FDA procedures. Receiving priority review from the FDA does not guarantee approval within the six-month review cycle or at all.

Accelerated approval by the FDA, even if granted for any of our product candidates, may not lead to a faster development or regulatory review or approval process and it does not increase the likelihood that our product candidates will receive regulatory approval.

We may seek accelerated approval of our current or future product candidates using the FDA’s accelerated approval pathway. A product may be eligible for accelerated approval if it treats a serious or life-threatening condition and provides a meaningful advantage over available therapies. In addition, it must demonstrate an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality (“IMM”), that is reasonably likely to predict an effect on IMM or other clinical benefit. As a condition of approval, the FDA requires that a sponsor of a drug or biologic receiving accelerated approval perform adequate and well-controlled post-marketing clinical trials. These confirmatory trials must be completed with due diligence. In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch of the product, if approved. Even if we do receive accelerated approval, we may not experience a faster development or regulatory review or approval process, and receiving accelerated approval does not provide assurance of ultimate FDA approval.

The FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses.

If any of our product candidates are approved and we are found to have improperly promoted off-label uses of those products, we may become subject to significant liability under the FDCA, the False Claims Act, or other federal or state laws. The FDA and other regulatory agencies strictly regulate the promotional claims that may be made about prescription products, if approved. In particular, in August 2021 the FDA finalized a rule clarifying its position on the types of evidence it will consider when determining a medical product’s intended use. In the final rule, the FDA declined to narrow its interpretation of evidence of intended use to a firm’s promotional claims and indicated its intent to look broadly at any relevant evidence to establish intended use. While the FDA permits the dissemination of truthful and non-misleading information about an approved product, a manufacturer may not promote a product for uses that are not approved by the FDA or such other regulatory agencies as

 

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reflected in the product’s approved labeling. If we are found to have promoted such off-label uses, intentionally or unintentionally, we may become subject to significant liability. The federal government has levied large civil and criminal fines against companies for alleged improper promotion of off-label use and has enjoined several companies from engaging in off-label promotion. The FDA has also requested that companies enter into consent decrees, corporate integrity agreements or permanent injunctions under which specified promotional conduct must be changed or curtailed. If we cannot successfully manage the promotion of our product candidates, if approved, we could become subject to significant liability, which would materially adversely affect our business and financial condition.

The FDA, the EMA and other regulatory authorities may implement additional regulations or restrictions on the development and commercialization of our product candidates, and such changes can be difficult to predict.

The FDA, the EMA and regulatory authorities in other countries have each expressed interest in further regulating biotechnology products. Agencies at both the federal and state level in the United States, as well as the U.S. Congressional committees and other governments or governing agencies, have also expressed interest in further regulating the biotechnology industry. Such action may delay or prevent commercialization of some or all of our product candidates. Adverse developments in clinical trials of products conducted by others may cause the FDA or other oversight bodies to change the requirements for approval of any of our product candidates. These regulatory review agencies and committees and the new requirements or guidelines they promulgate may lengthen the regulatory review process, require us to perform additional studies or trials, increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of our product candidates or lead to significant post-approval limitations or restrictions. As we advance our product candidates, we will be required to consult with these regulatory agencies and comply with applicable requirements and guidelines. If we fail to do so, we may be required to delay or discontinue development of such product candidates. These additional processes may result in a review and approval process that is longer than we otherwise would have expected. Delays as a result of an increased or lengthier regulatory approval process or further restrictions on the development of our product candidates can be costly and could negatively impact our ability to complete clinical trials and commercialize our current and future product candidates in a timely manner, if at all.

Even if we receive regulatory approval for any of our product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense. Additionally, our product candidates, if approved, could be subject to post-market study requirements, marketing and labeling restrictions, and even recall or market withdrawal if unanticipated safety issues are discovered following approval. In addition, we may be subject to penalties or other enforcement action if we fail to comply with regulatory requirements.

If the FDA or a comparable foreign regulatory authority approves any of our product candidates, the manufacturing processes, labeling, packaging, distribution, import, export, adverse event reporting, storage, advertising, promotion, monitoring, and recordkeeping for the product will be subject to extensive and ongoing regulatory requirements. These requirements include submissions of safety and other post-marketing information and reports, establishment registration and listing, as well as continued compliance with cGMPs and GCPs for any clinical trials that we conduct post-approval. Any regulatory approvals that we receive for our product candidates may also be subject to limitations on the approved indicated uses for which the product may be marketed or to the conditions of approval, or contain requirements for potentially costly post-marketing studies, including Phase 4 clinical trials, and surveillance to monitor the safety and efficacy of the product. The FDA may also require a REMS in order to approve our product candidates, which could entail requirements for a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools. Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with our third-party

 

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manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may result in, among other things:

 

   

restrictions on the marketing or manufacturing of the product, withdrawal of the product from the market, or voluntary or mandatory product recalls;

 

   

manufacturing delays and supply disruptions where regulatory inspections identify observations of noncompliance requiring remediation;

 

   

revisions to the labeling, including limitation on approved uses or the addition of additional warnings, contraindications or other safety information, including boxed warnings;

 

   

imposition of a REMS which may include distribution or use restrictions;

 

   

requirements to conduct additional post-market clinical trials to assess the safety of the product;

 

   

clinical trial holds;

 

   

fines, warning letters or other regulatory enforcement action;

 

   

refusal by the FDA to approve pending applications or supplements to approved applications filed by us or suspension or revocation of approvals;

 

   

product seizure or detention, or refusal to permit the import or export of products; and

 

   

injunctions or the imposition of civil or criminal penalties.

The FDA’s and other regulatory authorities’ policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any regulatory approval that we may have obtained, which would adversely affect our business, prospects and ability to achieve or sustain profitability.

Healthcare legislative reform discourse and potential or enacted measures may have a material adverse impact on our business and results of operations and legislative or political discussions surrounding the desire for and implementation of pricing reforms may adversely impact our business.

In both the United States and certain foreign jurisdictions, there have been a number of legislative and regulatory changes to the health care system that could impact our ability to sell our products profitably. In particular, in 2010, the ACA was enacted. Since its enactment, there have been numerous judicial, administrative, executive, and legislative challenges to certain aspects of the ACA. It is unclear how other healthcare reform measures of the Biden administrations or other efforts, if any, to challenge repeal or replace the ACA, will impact our business.

Other legislative changes have been proposed and adopted in the United States since the ACA was enacted. Additionally, there has been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices. Specifically, there have been several recent U.S. Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs.

At a federal level, President Biden signed an Executive Order on July 9, 2021 affirming the administration’s policy to (i) support legislative reforms that would lower the prices of prescription drug and biologics, including by allowing Medicare to negotiate drug prices, by imposing inflation caps, and, by supporting the development and market entry of lower-cost generic drugs and biosimilars; and (ii) support the enactment of a public health insurance option. Among other things, the Executive Order also directs the U.S. Department of Health and Human Services (“HHS”) to provide a report on actions to combat excessive pricing of prescription drugs,

 

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enhance the domestic drug supply chain, reduce the price that the Federal government pays for drugs, and address price gouging in the industry; and directs the FDA to work with states and Indian Tribes that propose to develop section 804 Importation Programs in accordance with the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, and the FDA’s implementing regulations. FDA released such implementing regulations on September 24, 2020, which went into effect on November 30, 2020, providing guidance for states to build and submit importation plans for drugs from Canada. On September 25, 2020, the HHS’s Centers for Medicare & Medicaid Services (“CMS”) stated that drugs imported by states under this rule will not be eligible for federal rebates under Section 1927 of the Social Security Act and manufacturers would not report these drugs for “best price” or Average Manufacturer Price purposes. Since these drugs are not considered covered outpatient drugs, CMS further stated it will not publish a National Average Drug Acquisition Cost for these drugs. If implemented, importation of drugs from Canada may materially and adversely affect the price we receive for any of our product candidates. Further, on November 20, 2020 CMS issued an Interim Final Rule implementing the Most Favored Nation, or MFN, Model under which Medicare Part B reimbursement rates would have been calculated for certain drugs and biologicals based on the lowest price drug manufacturers receive in Organization for Economic Cooperation and Development countries with a similar gross domestic product per capita. However, on August 6, 2021 CMS announced a proposed rule to rescind the Most Favored Nations rule. Additionally, on December 2, 2020, HHS published a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law. The rule also creates a new safe harbor for price reductions reflected at the point-of-sale, as well as a safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers. On November 30, 2020, HHS published a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law. The rule also creates a new safe harbor for price reductions reflected at the point-of-sale, as well as a safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers. Further, implementation of these changes and new safe harbors for point-of-sale reductions in price for prescription pharmaceutical products and pharmacy benefit manager service fees are currently under review by the Biden administration and may be amended or repealed. Although a number of these and other proposed measures may require authorization through additional legislation to become effective, and the Biden administration may reverse or otherwise change these measures, both the Biden administration and Congress have indicated that it will continue to seek new legislative measures to control drug costs. The effect of these legislative and executive activities on our business model and operations is currently unclear.

At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

We are subject to federal and state laws and regulations related to privacy, data protection, information security and consumer protection across different markets where we conduct our business. Our actual or perceived failure to comply with such obligations could harm our business.

We are subject to laws and regulations related to, among other things, privacy, data protection, information security and consumer protection across different markets were we conduct our business in those markets. Such laws and regulations are constantly evolving and changing and are likely to remain uncertain for the foreseeable future. Our actual or perceived failure to comply with such obligations could have an adverse effect on our business, operating results and financial operations. For example, on June 28, 2018, California enacted the California Consumer Privacy Act (“CCPA”), which took effect on January 1, 2020. The CCPA creates individual privacy rights for California consumers, increases the privacy and security obligations of entities handling certain personal information, requires new disclosures to California individuals and affords such individuals new abilities to opt out of certain sales of personal information, and provides for civil penalties for violations as well as a private right of action for data breaches that is expected to increase data breach litigation. Additionally, the

 

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Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (“HITECH”) and its implementing regulations, and as amended again by the Modifications to the HIPAA Privacy, Security, Enforcement and Breach Notification Rules Under HITECH and the Genetic Information Nondiscrimination Act; Other Modifications to the HIPAA Rules published in January 2013 (commonly referred to as the “Final HIPAA Omnibus Rule”), imposes certain obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information without appropriate authorization by covered entities subject to the Final HIPAA Omnibus Rule. There are European and other foreign law equivalents of each of such laws with similar requirements. Complying with these numerous, complex, and often changing regulations is expensive and difficult, and failure to comply with any privacy laws or data security laws or any security incident or breach involving the misappropriation, loss or other unauthorized processing, use or disclosure of sensitive or confidential patient, consumer or other personal information, whether by us, one of our collaborators or another third party, could adversely affect our business, financial condition, and results of operations, including but not limited to investigation costs, material fines and penalties, compensatory, special, punitive, and statutory damages, litigation, consent orders regarding our privacy and security practices, requirements that we provide notices, credit monitoring services, and/or credit restoration services or other relevant services to impacted individuals, adverse actions against our licenses to do business, reputational damage and injunctive relief.

European data collection is also governed by restrictive regulations governing the use, processing and cross-border transfer of personal information. The collection, use, storage, disclosure, transfer, or other processing of personal data regarding individuals in the European Union (the “EU”), including personal health data, is subject to the EU General Data Protection Regulation (“GDPR”), which imposes strict requirements for processing the personal data of individuals within the European Economic Area (the “EEA”). The GDPR is directly applicable in each EU member state and is extended to the EEA. The GDPR is wide-ranging in scope and imposes numerous requirements on companies that process personal data, including requirements relating to processing health and other sensitive data, obtaining consent of the individuals to whom the personal data relates, providing information to individuals regarding data processing activities, implementing safeguards to protect the security and confidentiality of personal data, providing notification of data breaches, and taking certain measures when engaging third-party processors. The GDPR implements more stringent operational requirements than its predecessor legislation. Compliance with the GDPR will be a rigorous and time-intensive process that may increase our cost of doing business or require us to change our business practices, and despite those efforts, there is a risk that we may be subject to fines and penalties, litigation, and reputational harm in connection with our European activities. For example, the GDPR applies extraterritorially, requires us to make more detailed disclosures to data subjects, requires disclosure of the legal basis on which we can process personal data, makes it harder for us to obtain valid consent for collecting and processing personal data (including data from clinical trials), requires the appointment of data protection officers when sensitive personal data, such as health data, is processed on a large scale, provides more robust rights for data subjects, introduces mandatory data breach notification through the EU, imposes additional obligations on us when contracting with service providers and requires us to adopt appropriate privacy governance, including policies, procedures, training, and data audit. The GDPR provides that EEA countries may establish their own laws and regulations limiting the processing of personal data, including genetic, biometric, or health data, which could limit our ability to use and share personal data or could cause our costs to increase. Among other requirements, the GDPR regulates transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States, and the efficacy and longevity of current transfer mechanisms between the EU and the United States remains uncertain. For example, in 2016, the EU and United States agreed to a transfer framework for data transferred from the EU to the United States, called the Privacy Shield, but the Privacy Shield was invalidated in July 2020 by the Court of Justice of the European Union (“CJEU”). The CJEU upheld the adequacy of the Standard Contractual Clauses (“SCCs”), a standard form of contract approved by the European Commission as an adequate personal data transfer mechanism, it made clear that reliance on them alone may not necessarily be sufficient in all circumstances. New SCCs were adopted by the European Commission on June 4, 2021, replacing the 2001, 204, and 2010 SCCs that were previously in use. Use of the SCCs must nonetheless now be assessed on a case-by-case basis taking into account the legal regime applicable

 

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in the destination country, in particular applicable surveillance laws and rights of individuals and additional measures and/or contractual provisions may need to be put in place, however, the nature of these additional measures is currently uncertain.

We cannot assure you that our third-party service providers with access to our or our customers’, suppliers’, trial patients’ and employees’ personally identifiable and other sensitive or confidential information will not breach contractual obligations imposed by us, or that they will not experience data security breaches or attempts thereof, which could have a corresponding effect on our business, including putting us in breach of our obligations under privacy laws and regulations and/or which could in turn adversely affect our business, results of operations, and financial condition. We cannot assure you that our contractual measures and our own privacy and security-related safeguards will protect us from the risks associated with the third-party processing, use, storage, and transmission of such information. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, and prospects.

Our internal computer systems, or those used by our contractors or consultants, may fail or experience security breaches or other unauthorized or improper access.

Despite the implementation of security measures, our internal computer systems, and those of our contract research organizations (“CROs”) and other third parties on which we rely, are vulnerable to privacy and information security incidents, such as data breaches, damage from computer viruses and unauthorized access, malware, natural disasters, fire, terrorism, war and telecommunication, electrical failures, cyber-attacks or cyber-intrusions over the Internet, attachments to emails, persons inside our organization or persons with access to systems inside our organization. The risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. While we have not experienced any such material system failure or security breach to our knowledge to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our development programs and our business operations. For example, the loss of clinical trial data from completed, ongoing or future clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. Likewise, our ability to commercialize products depends on third parties to conduct clinical trials and manufacture products, and similar events relating to their computer systems could also have a material adverse effect on our business.

Unauthorized disclosure of sensitive or confidential data, including personally identifiable information, whether through a breach of computer systems, systems failure, employee negligence, fraud or misappropriation, or otherwise, or unauthorized access to or through our information systems and networks, whether by our employees or third parties, could result in negative publicity, legal liability and damage to our reputation. Unauthorized disclosure of personally identifiable information could also expose us to sanctions for violations of data privacy laws and regulations around the world. To the extent that any disruption or security breach resulted in a loss of or damage to our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and the further development of our product candidates could be delayed.

As we become more dependent on information technologies to conduct our operations, cyber incidents, including deliberate attacks and attempts to gain unauthorized access to computer systems and networks, may increase in frequency and sophistication. These threats pose a risk to the security of our systems and networks, the confidentiality and the availability and integrity of our data and these risks apply both to us, and to third parties on whose systems we rely for the conduct of our business. Because the techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently and often are not recognized until launched against a target, we and our partners may be unable to anticipate these techniques or to implement adequate preventative measures. Further, we do not have any control over the operations of the facilities or technology of our cloud and service providers. Our systems, servers and platforms and those of our service providers may be vulnerable to computer viruses or physical or electronic break-ins that our or their

 

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security measures may not detect. Individuals able to circumvent such security measures may misappropriate our confidential or proprietary information, disrupt our operations, damage our computers or otherwise impair our reputation and business. We may need to expend significant resources and make significant capital investment to protect against security breaches or to mitigate the impact of any such breaches. There can be no assurance that we or our third-party providers will be successful in preventing cyber-attacks or successfully mitigating their effects. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and the further development and commercialization of our future product candidates could be delayed.

If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could have a material adverse effect on the success of our business.

We are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the handling, use, storage, treatment and disposal of hazardous materials and wastes. Our operations involve the use of hazardous and flammable materials, including chemicals and biological and radioactive materials. Our operations also produce hazardous waste products. We generally contract with third parties for the disposal of these materials and wastes. We cannot eliminate the risk of contamination or injury from these materials. In the event of contamination or injury resulting from our use of hazardous materials, we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costs associated with civil or criminal fines and penalties.

Although we maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. We do not maintain insurance for environmental liability or toxic tort claims that may be asserted against us in connection with our storage or disposal of biological, hazardous or radioactive materials.

We are subject to U.S. and certain foreign export and import controls, sanctions, embargoes, anti-corruption laws and anti-money laundering laws and regulations. Compliance with these legal standards could impair our ability to compete in domestic and international markets. We can face criminal liability and other serious consequences for violations, which can harm our business.

We are subject to export control and import laws and regulations, including the U.S. Export Administration Regulations, U.S. Customs regulations, various economic and trade sanctions regulations administered by the U.S. Treasury Department’s Office of Foreign Assets Controls, the U.S. Foreign Corrupt Practices Act of 1977, as amended, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, the USA PATRIOT Act and other state and national anti-bribery and anti-money laundering laws in the countries in which we conduct activities. Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, contractors, and other collaborators from authorizing, promising, offering or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or private sector. We may engage third parties for clinical trials outside of the United States, to sell our products abroad once we enter a commercialization phase and/or to obtain necessary permits, licenses, patent registrations, and other regulatory approvals. We have direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals, universities and other organizations. We can be held liable for the corrupt or other illegal activities of our employees, agents, contractors and other collaborators, even if we do not explicitly authorize or have actual knowledge of such activities. Any violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm and other consequences.

 

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Inadequate funding for the FDA, the SEC and other government agencies, including from government shut downs, or other disruptions to these agencies’ operations, could hinder their ability to hire and retain key leadership and other personnel, prevent new products and services from being developed or commercialized in a timely manner or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business.

The ability of the FDA to review and approve new products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel, and accept payment of user fees, and statutory, regulatory, and policy changes. Average review times at the agency have fluctuated in recent years as a result. In addition, government funding of the SEC and other government agencies on which our operations may rely, including those that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable.

Disruptions at the FDA and other agencies may also slow the time necessary for new drugs to be reviewed and/or approved by necessary government agencies, which would adversely affect our business. For example, over the last several years, the U.S. government has shut down several times, and certain regulatory agencies, such as the FDA and the SEC, have had to furlough critical FDA, SEC, and other government employees and stop critical activities. If a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business. Further, future government shutdowns could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.

Additionally, since March 2020, when foreign and domestic inspections of facilities were largely placed on hold due to the COVID-19 pandemic, the FDA has been working to resume routine surveillance, bioresearch monitoring and pre-approval inspections on a prioritized basis. The FDA has developed a rating system to assist in determining when and where it is safest to conduct prioritized domestic inspections. As of May 2021, certain inspections, such as foreign preapproval, surveillance, and for-cause inspections that are not deemed mission critical, remain temporarily postponed. In April 2021, the FDA issued guidance for industry formally announcing plans to employ remote interactive evaluations, using risk management methods, to meet user fee commitments and goal dates and in May 2021 announced plans to continue progress toward resuming standard operational levels. Should the FDA determine that an inspection is necessary for approval and an inspection cannot be completed during the review cycle due to restrictions on travel, and the FDA does not determine a remote interactive evaluation to be adequate, the agency has stated that it generally intends to issue a complete response letter or defer action on the application until an inspection can be completed. Additionally, as of March 18, 2021, the FDA noted it is continuing to ensure timely reviews of applications for medical products during the COVID-19 pandemic in line with its user fee performance goals and conducting mission critical domestic and foreign inspections to ensure compliance of manufacturing facilities with FDA quality standards. However, the FDA may not be able to continue its current pace and approval timelines could be extended, including where a pre-approval inspection or an inspection of clinical sites is required and due to the COVID-19 pandemic and travel restrictions the FDA is unable to complete such required inspections during the review period. In 2020 and 2021, a number of companies announced receipt of complete response letters due to the FDA’s inability to complete required inspections for their applications. Regulatory authorities outside the United States may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic and may experience delays in their regulatory activities.

Risks Related to Holdco

Holdco will incur increased costs as a result of operating as a public company, and its management will devote substantial time to new compliance initiatives.

If Holdco completes the Business Combination and becomes a public company, it will incur significant legal, accounting and other expenses that it did not incur as a private company, and these expenses may increase even more after Holdco is no longer an emerging growth company, as defined in Section 2(a) of the Securities

 

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Act. As a public company, Holdco will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules adopted, and to be adopted, by the SEC and the Nasdaq. Holdco’s management and other personnel will need to devote a substantial amount of time to these compliance initiatives. Moreover, Holdco expects these rules and regulations to substantially increase its legal and financial compliance costs and to make some activities more time consuming and costly. The increased costs will increase Holdco’s net loss. For example, these rules and regulations could make it more difficult and more expensive for Holdco to obtain director and officer liability insurance and as a result, Holdco may be forced to accept reduced policy limits or incur substantially higher costs to maintain the same or similar coverage. Holdco cannot predict or estimate the amount or timing of additional costs it may incur to respond to these requirements. The impact of these requirements could also make it more difficult for Holdco to attract and retain qualified persons to serve on its board of directors or as executive officers.

Holdco’s management has limited experience in operating a public company.

Holdco’s executive officers have limited experience in the management of a publicly traded company. Holdco’s management team may not successfully or effectively manage its transition to a public company that will be subject to significant regulatory oversight and reporting obligations under federal securities laws. Their limited experience in dealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage in that it is likely that an increasing amount of their time may be devoted to these activities which will result in less time being devoted to the management and growth of the Combined Company. Holdco may not have adequate personnel with the appropriate level of knowledge, experience, and training in the accounting policies, practices or internal controls over financial reporting required of public companies in the U.S. The development and implementation of the standards and controls necessary for the Combined Company to achieve the level of accounting standards required of a public company in the U.S. may require costs greater than expected. It is possible that the Combined Company will be required to expand its employee base and hire additional employees to support its operations as a public company, which will increase its operating costs in future periods.

There can be no assurance that the Holdco Common Stock that will be issued in connection with the Business Combination will be approved for listing on the Nasdaq or, if approved, will continue to be so listed following the closing of the Business Combination, or that Holdco will be able to comply with the continued listing standards of Nasdaq.

Holdco intends to apply for the listing of the Holdco Common Stock and Holdco Warrants on Nasdaq. If Nasdaq denies its application for failure to meet the listing standards or if Holdco subsequently does not satisfy any additional listing standards, Holdco and its stockholders could face significant material adverse consequences including:

 

   

a limited availability of market quotations for its securities;

 

   

reduced liquidity for its securities;

 

   

a determination that Holdco Common Stock is a “penny stock” which will require brokers trading in the Holdco Common Stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for its securities;

 

   

a limited amount of news and analyst coverage; and

 

   

a decreased ability to issue additional securities or obtain additional financing in the future.

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” If the Holdco Common Stock is listed on Nasdaq, they will be covered securities. Although the states are preempted

 

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from regulating the sale of the Combined Company’s securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. While Holdco is not aware of a state, other than the State of Idaho, having used these powers to prohibit or restrict the sale of securities issued by blank check companies, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if the Combined Company was not listed on Nasdaq, its securities would not be covered securities and it would be subject to regulation in each state in which it offers its securities.

If the Combined Company fails to maintain effective internal controls over financial reporting, the price of Holdco securities may be adversely affected.

The Combined Company will be required to establish and maintain appropriate internal controls over financial reporting. Failure to establish those controls, or any failure of those controls once established, could adversely affect the Combined Company’s public disclosures regarding its business, financial condition or results of operations. In addition, management’s assessment of internal controls over financial reporting may identify weaknesses and conditions that need to be addressed in the Combined Company’s internal controls over financial reporting, or other matters that may raise concerns for investors. Any actual or perceived weaknesses and conditions that need to be addressed in the Combined Company’s internal controls over financial reporting, or disclosure of management’s assessment of the Combined Company’s internal controls over financial reporting, may have an adverse impact on the price of Holdco securities.

The Combined Company’s failure to timely and effectively implement controls and procedures required by Section 404(a) (“Section 404(a)”) of the Sarbanes-Oxley Act that will be applicable to it after the Business Combination is consummated could have a material adverse effect on its business, operating results and financial condition.

Holdco is not currently subject to Section 404 of the Sarbanes-Oxley Act. However, following the consummation of the Business Combination, the Combined Company will be required to provide management’s attestation on internal controls. The standards required for a public company under Section 404(a) are significantly more stringent than those required of Comera as a privately held company. Management may not be able to effectively and timely implement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements that will be applicable after the Business Combination. If the Combined Company is not able to implement the additional requirements of Section 404(a) in a timely manner or with adequate compliance, it may not be able to assess whether its internal controls over financial reporting are effective or may result in a finding that there is a material weakness in the Combined Company’s internal controls over financial reporting, which may subject it to adverse regulatory consequences and could harm investor confidence and the market price of its securities.

There may be sales of a substantial amount of Holdco Common Stock after the Business Combination by the current OTR Stockholders and/or Comera Stockholders, and these sales could cause the price of Holdco’s securities to fall.

After the Business Combinations, there will be approximately 25,842,017 shares of Holdco Common Stock outstanding including 2,611,838 shares of Holdco Common Stock held by the Sponsor and [●] shares of Holdco Common Stock held by the Comera Stockholders that will be subject to certain lock-up arrangements. Of the issued and outstanding shares of OTR Common Stock that were issued prior to the Business Combination, all will be freely transferable, except for any shares held by our “affiliates,” as that term is defined in Rule 144 under the Securities Act, and shares subject to lock-up arrangements. Following completion of the Business Combination, Holdco expects that approximately [●]% of the outstanding shares of Holdco Common Stock will be held by entities affiliated with Holdco and its executive officers and directors.

 

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After the Business Combination and pursuant to the Registration Rights and Lock-Up Agreement, certain stockholders will be entitled to demand that Holdco registers the resale of their securities subject to certain minimum requirements. These stockholders will also have certain “piggyback” registration rights with respect to registration statements filed subsequent to the Business Combination.

Upon effectiveness of any registration statement Holdco files pursuant to the Registration Rights and Lock-Up Agreement, and upon the expiration of the lock-up periods applicable to the parties to the Registration Rights and Lock-Up Agreement, these parties may sell large amounts of Holdco Common Stock in the open market or in privately negotiated transactions, which could have the effect of increasing the volatility in the share price of Holdco Common Stock or putting significant downward pressure on the price of Holdco Common Stock.

Sales of substantial amounts of Holdco Common Stock in the public market after the Business Combination, or the perception that such sales will occur, could adversely affect the market price of Holdco Common Stock and make it difficult for us to raise funds through securities offerings in the future.

A market for Holdco’s securities may not continue, which would adversely affect the liquidity and price of its securities.

Following the Business Combination, the price of Holdco Common Stock and Holdco Warrants may fluctuate significantly due to the market’s reaction to the Business Combination and general market and economic conditions. An active trading market for Holdco Common Stock and Holdco Warrants following the Business Combination may never develop or, if developed, it may not be sustained. In addition, the price of Holdco Common Stock and Holdco Warrants after the Business Combination can vary due to general economic conditions and forecasts, its general business condition and the release of its financial reports. If its securities are not listed on, or become delisted from, the Nasdaq for any reason, and are quoted on the OTC Bulletin Board, an inter-dealer automated quotation system for equity securities that is not a national securities exchange, the liquidity and price of its securities may be more limited than if it were quoted or listed on the Nasdaq or another national securities exchange. You may be unable to sell your Holdco securities unless a market can be established or sustained.

If, following the Business Combination, securities or industry analysts do not publish or cease publishing research or reports about the Combined Company, its business, or its market, or if they change their recommendations regarding Holdco Common Stock adversely, then the price and trading volume of Holdco Common Stock or Holdco Warrants could decline.

The trading market for Holdco Common Stock and Holdco Warrants will be influenced by the research and reports that industry or securities analysts may publish about the Combined Company, its business, its market, or its competitors. Securities and industry analysts do not currently, and may never, publish research on OTR or the Combined Company. If no securities or industry analysts commence coverage of the Combined Company, Holdco Common Stock and Holdco Warrant price and trading volume would likely be negatively impacted. If any of the analysts who may cover the Combined Company change their recommendation regarding Holdco Common Stock and Holdco Warrants adversely, or provide more favorable relative recommendations about Holdco’s competitors, the price of Holdco Common Stock and Holdco Warrants would likely decline. If any analyst who may cover OTR were to cease coverage of the Combined Company or fail to regularly publish reports on it, Holdco could lose visibility in the financial markets, which could cause the price or trading volume of Holdco Common Stock or Holdco Warrant to decline.

The JOBS Act permits “emerging growth companies” like Holdco to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies.

Holdco currently qualifies as an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such,

 

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Holdco takes advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as it continues to be an emerging growth company, including the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act. As a result, Holdco stockholders may not have access to certain information they deem important. Holdco will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of the IPO, (b) in which Holdco has total annual gross revenue of at least $1.07 billion, or (c) in which Holdco is deemed to be a large accelerated filer, which means the market value of Holdco common equity that is held by non-affiliates equals or exceeds $700.0 million as of the end of the prior fiscal year’s second fiscal quarter; and (2) the date on which Holdco has issued more than $1.00 billion in non-convertible debt securities during the prior three-year period.

Holdco cannot predict if investors will find Holdco Common Stock and Holdco Warrants less attractive because it relies on these exemptions. If some investors find Holdco Common Stock or Holdco Warrants less attractive as a result, there may be a less active trading market and share price for Holdco Common Stock or Holdco Warrants may be more volatile. Holdco does not expect to qualify as an emerging growth company after the last day of the fiscal year in which the Business Combination is consummated and may incur increased legal, accounting and compliance costs associated with Section 404 of the Sarbanes-Oxley Act.

Comera’s directors and officers may have interests in the Business Combination different from the interests of Comera’s stockholders.

Executive officers of Comera negotiated the terms of the Business Combination Agreement with their counterparts at OTR, and the Comera Board of Directors has considered the Business Combination and the terms of the Business Combination Agreement and unanimously approved and declared that the Business Combination Agreement, the Business Combination and the other transactions contemplated by the Business Combination Agreement, upon the terms and conditions set forth in the Business Combination Agreement, are advisable and in the best interest of Comera and its stockholders and recommended that Comera Stockholders approve the Comera Business Combination Proposal. In considering these facts and the other information contained in this proxy statement/prospectus, you should be aware that Comera’s executive officers and directors may have financial interests in the Business Combination that may be different from, or in addition to, the interests of Comera’s stockholders. The Comera Board of Directors was aware of and considered these interests, among other matters, in reaching the determination to unanimously approve the terms of the Business Combination and in recommending to Comera’s stockholders that they vote to approve the Business Combination. For a detailed discussion of the special interests that Comera’s directors and executive officers may have in the Business Combination, please see the section entitled “The Business Combination — Interests of Comera’s Directors and Executive Officers in the Business Combination” beginning on page 128.

Risks Related to OTR and the Business Combination

We may fail to realize the strategic and financial benefits currently anticipated from the Business Combination.

The future success of the Business Combination, including anticipated benefits, depends, in part, on our ability to optimize our operations as a public company. The optimization of our operations following the Business Combination will be a complex, costly and time-consuming process and if we experience difficulties in this process, the anticipated benefits may not be realized fully or at all, or may take longer to realize than expected, which could have an adverse effect on us for an undetermined period. There can be no assurances that we will realize the potential operating efficiencies, synergies and other benefits currently anticipated from the Business Combination.

Some of the factors involved in this are outside of our control, and any one of them could result in delays, increased costs, decreases in the amount of potential revenues, potential cost savings, and diversion of

 

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management’s time and energy, which could materially affect our business, financial condition and results of operations.

The requirements of being a public company may strain the Combined Company’s resources and divert management’s attention, and the increases in legal, accounting and compliance expenses that will result from the proposed business combination may be greater than we anticipate.

As a public company, the Combined Company will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and the Nasdaq rules. The requirements of these rules and regulations will impact the Combined Company’s legal, accounting and compliance expenses, make some activities more difficult, time-consuming or costly and place strain on its personnel, systems and resources. The Sarbanes-Oxley Act requires, among other things, that the Combined Company maintain effective disclosure controls and procedures and internal control over financial reporting. Ensuring that the Combined Company will have adequate internal financial and accounting controls and procedures in place is a costly and time-consuming effort that needs to be re-evaluated frequently. We do not expect that the Combined Company will initially have an internal audit group, and the Combined Company may need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge. Implementing any appropriate changes to the Combined Company’s internal controls may require specific compliance training for the Combined Company’s directors, officers and employees, entail substantial costs, and take a significant period of time to complete. Such changes may not, however, be effective in maintaining the adequacy of the Combined Company’s internal controls and any failure to maintain that adequacy, or consequent inability to produce accurate financial statements on a timely basis, could increase the Combined Company’s operating costs and could materially impair its ability to operate its business. Moreover, effective internal controls are necessary for the Combined Company to produce reliable financial reports and are important to help prevent fraud.

In accordance with the Nasdaq rules, unless the Combined Company is eligible for an exemption, it will be required to maintain a majority of independent directors on the board. The various rules and regulations applicable to public companies make it more difficult and more expensive for the Combined Company to maintain directors’ and officers’ liability insurance, and the Combined Company may be required to accept reduced coverage or incur substantially higher costs to maintain coverage. If the Combined Company is unable to maintain adequate directors’ and officers’ insurance, its ability to recruit and retain qualified officers and directors will be significantly curtailed.

We expect that the rules and regulations applicable to public companies will result in the Combined Company incurring substantial additional legal and financial compliance costs. These costs will decrease the Combined Company’s net income or increase its net loss and may require it to reduce costs in other areas of its business.

There may be tax consequences of the Business Combination that may adversely affect holders of OTR Common Stock, OTR Warrants, or Comera Common Stock.

Although we expect the exchange of OTR Common Stock and Comera Common Stock for Holdco Common Stock pursuant to the Business Combination to qualify as a tax-free exchange for U.S. federal income tax purposes, the requirements for tax-free treatment are complex and qualification for such treatment could be adversely affected by events or actions that occur following the Business Combination that are beyond OTR’s and Comera’s control. To the extent the Business Combination does not so qualify, it could result in the imposition of substantial taxes on the holders of OTR Common Stock, OTR Warrants, and Comera Common Stock.

The appropriate U.S. federal income tax treatment of the OTR Warrants in connection with the Business Combination is uncertain and depends on whether the OTR Merger, in addition to qualifying as an exchange described in Section 351(a) of the Code, will also qualify as a “reorganization” under Section 368 of the Code. It

 

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is possible that a U.S. holder of OTR Warrants could be treated as exchanging such OTR Warrants and OTR Common Stock, if any, for “new” Holdco Warrants and Holdco Common Stock, if any, in a transaction that qualifies as a “reorganization” under Section 368 of the Code. Alternatively, it is also possible that a U.S. holder of OTR Warrants could be treated as transferring its OTR Warrants and OTR Common Stock, if any, to Holdco in an exchange governed only by Section 351 of the Code (and not by Section 368 of the Code), in which case such U.S. holder would recognize gain (but not loss) in an amount equal to the lesser of (i) the amount of gain realized by such holder (generally, the excess of (x) the sum of the fair market values of the Holdco Warrants treated as received by such holder and the Holdco Common Stock received by such holder, if any, over (y) such holder’s aggregate adjusted tax basis in the OTR Warrants and OTR Common Stock, if any, exchanged therefor) and (ii) the fair market value of the Holdco Warrants received by such holder in such exchange.

There are many requirements that must be satisfied in order for the OTR Merger to qualify as a “reorganization” under Section 368 of the Code, some of which are based upon factual determinations and others are fundamental to corporate reorganizations. For example, to qualify as a reorganization, the acquiring corporation must either continue the acquired corporation’s historical business or use a significant portion of the acquired corporation’s historical business assets in a business. Because OTR is a blank check company, it is unclear whether its historic business is sufficient to satisfy this requirement. In addition, reorganization treatment could be adversely affected by events or actions that occur prior to or at the time of the OTR Merger, some of which are outside the control of OTR. Accordingly, due to the factual uncertainty and the lack of authority, Greenberg Traurig, LLP is unable to opine with respect to the OTR Merger’s qualification as a reorganization under Section 368 of the Code.

The requirements for tax-free treatment are discussed in more detail under the section titled “Material U.S. Federal Income Tax Considerations—U.S. Holders—The Business Combination.” If you are a U.S. holder (as defined in Material U.S. Federal Income Tax Considerations—U.S. Holders) exchanging OTR Common Stock or Comera Common Stock in the Business Combination or holding OTR Warrants at the time of the Business Combination, you are urged to consult your tax advisor to determine the tax consequences thereof.

Subsequent to the consummation of the Business Combination, the Combined Company may be required to take write-downs or write-offs, or the Combined Company may be subject to restructuring, impairment or other charges that could have a significant negative effect on the Combined Company’s business, financial condition and results of operations as well as the price of our stock, which could cause you to lose some or all of your investment.

Even though we have conducted extensive due diligence on Comera, we cannot assure you that this diligence identified all material issues that may be present, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of Comera’s and outside of our control will not later arise. As a result of these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or other charges that could result in our reporting losses. Even if our due diligence successfully identified certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about our securities or us. Accordingly, any stockholder or warrant holder who chooses to remain a stockholder or warrant holder, respectively, following our initial business combination could suffer a reduction in the value of their securities. Such stockholders and warrant holders are unlikely to have a remedy for such reduction in value.

If the Business Combination’s benefits do not meet the expectations of investors or securities analysts, the market price of our securities or, following the consummation of the business combination, the Combined Company’s securities, may decline.

The market price of our common stock may decline as a result of our Business Combination if we do not achieve the perceived benefits of our Business Combination as rapidly, or to the extent anticipated by, financial

 

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analysts or the effect of our Business Combination on our financial results is not consistent with the expectations of financial analysts. Accordingly, holders of our common stock following the consummation of our Business Combination may experience a loss as a result of a decline in the market price of such common stock. In addition, a decline in the market price of our common stock following the consummation of our Business Combination could adversely affect our ability to issue additional securities and to obtain additional financing in the future.

OTR may not be able to consummate an initial business combination within the required time period, in which case it would cease all operations except for the purpose of winding up and it would redeem the Public Shares and liquidate.

OTR’s Sponsor, executive officers and directors have agreed that OTR must complete its initial business combination within 18 months from the closing of its IPO, or May 19, 2022. OTR may not be able to consummate an initial business combination within such time period. However, OTR’s ability to complete its initial business combination may be negatively impacted by general market conditions, volatility in the capital and debt markets and the other risks described herein.

If OTR is unable to consummate its initial business combination within the required time period, it will, as promptly as reasonably possible but not more than five business days thereafter, distribute the aggregate amount then on deposit in the Trust Account (net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses), pro rata to the Public Stockholders by way of redemption and cease all operations except for the purposes of winding up of its affairs, as further described herein. This redemption of Public Stockholders from the Trust Account shall be effected as required by function of OTR’s amended and restated certificate of incorporation and prior to any voluntary winding up.

For illustrative purposes, based on funds in the Trust Account of approximately $107.1 on September 30, 2021, the estimated per share redemption price would have been approximately $10.25.

OTR’s stockholders cannot be sure of the market value of the Holdco Common Stock to be issued upon completion of the Business Combination.

The holders of OTR Common Stock issued and outstanding immediately prior to the effective time of the Business Combination will receive one share of Holdco Common Stock in exchange for each share of OTR Common Stock held by them, rather than a number of shares with a particular fixed market value. The market value of OTR Common Stock at the time of the Business Combination may vary significantly from its price on the date the Business Combination Agreement was executed or the date of the registration statement of which this prospectus is a part. Because the exchange ratio of the shares will not be adjusted to reflect any changes in the market prices of OTR Common Stock, the market value of the Holdco Common Stock issued in the Business Combination and the OTR Common Stock surrendered in the Business Combination may be higher or lower than the value of these shares on earlier dates. 100% of the consideration to be received by OTR’s stockholders will be Holdco Common Stock. Following consummation of the Business Combination, the market price of Holdco’s securities may be influenced by many factors, some of which are beyond its control, including those described above and the following:

 

   

changes in financial estimates by analysts;

 

   

announcements by it or its competitors of significant contracts, productions, acquisitions or capital commitments;

 

   

fluctuations in its quarterly financial results or the quarterly financial results of companies perceived to be similar to it;

 

   

general economic conditions;

 

   

changes in market valuation of similar companies;

 

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terrorist acts;

 

   

changes in its capital structure, such as future issuances of securities or the incurrence of additional debt;

 

   

future sales of Holdco Common Stock;

 

   

regulatory developments in the U.S.;

 

   

litigation involving Holdco, its subsidiaries or its general industry; and

 

   

additions or departures of key personnel.

OTR’s board of directors did not obtain a fairness opinion in determining whether to proceed with the Business Combination and, as a result, the terms may not be fair from a financial point of view to the Public Stockholders.

In analyzing the Business Combination, OTR’s management conducted significant due diligence on Comera. For a complete discussion of the factors utilized by OTR’s board of directors in approving the business combination, see the section entitled, “The Business Combination — OTR’s Board of Directors’ Reasons for the Approval of the Business Combination.” OTR’s board of directors believes because of the financial skills and background of its directors, it was qualified to conclude that the Business Combination was fair from a financial perspective to its stockholders and that Comera’s fair market value was at least 80% of our net assets (excluding any taxes payable on interest earned).

Notwithstanding the foregoing, OTR’s board of directors did not obtain a fairness opinion to assist it in its determination. OTR’s board of directors may be incorrect in its assessment of the Business Combination.

Unlike some other business combination agreements with blank check companies, the Business Combination Agreement does not have a specified maximum redemption threshold. The absence of such a redemption threshold will make it easier for OTR to consummate the Business Combination even if a substantial number of OTR Stockholders redeem.

Since the Business Combination Agreement has no specified maximum redemption threshold, the terms and conditions of the Business Combination is different in this respect from the terms and conditions in the transaction agreements governing some business combinations with blank check companies. As a result, OTR may be able to consummate the Business Combination even though a substantial number of Public Stockholders have redeemed their shares. Redemptions of Public Shares by Public Stockholders will decrease the amount of cash available to Holdco following the Closing.

If OTR Stockholders fail to comply with the procedures for tendering their shares, such shares may not be redeemed.

This proxy statement/prospectus describes the various procedures that must be complied with in order for a Public Stockholder to validly redeem its Public Shares. In the event that an OTR Stockholder fails to comply with these procedures, its shares may not be redeemed.

OTR cannot be certain as to the number of Public Shares that will be redeemed and the potential impact to Public Stockholders who do not elect to redeem their Public Shares.

There is no guarantee that a Public Stockholder’s decision whether to redeem its Public Shares for a pro rata portion of the Trust Account will put the Public Stockholder in a better future economic position. We can give no assurance as to the price at which a Public Stockholder may be able to sell its Holdco Common Stock in the future following the Closing or its shares of OTR Common Stock following any alternative business

 

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combination. Certain events following the consummation of any initial business combination, including the Business Combination, and including redemptions of Public Shares may cause an increase or decrease in the share price of OTR, and may result in a lower value realized now than a Public Stockholder might realize in the future had the Public Stockholder not redeemed its Public Shares. Similarly, if a Public Stockholder does not redeem its Public Shares, the Public Stockholder will bear the risk of ownership of the Holdco Common Stock after the consummation of any initial business combination, and there can be no assurance that a Public Stockholder can sell its shares in the future for a greater amount than the redemption price for Public Shares. A Public Stockholder should consult its own tax and/or financial advisor for assistance on how this may affect its individual situation.

On [●], 2022, the closing price per share of OTR Common Stock was $[●]. Public Stockholders should be aware that while we are unable to predict the price per share of Holdco Common Stock following the consummation of the Business Combination (and accordingly we are unable to calculate the potential impact of redemptions on the per share market price of the Holdco Common Stock owned by non-redeeming Public Stockholders), increased levels of redemptions by Public Stockholders may be a result of the price per share of OTR Common Stock falling below the redemption price. We expect that more Public Stockholders may elect to redeem their Public Shares if the share price of the OTR Common Stock is below the redemption price at the time of the Closing, which price would have been approximately $10.25 per share as of [●], 2022, and we expect that more Public Stockholders may elect not to redeem their Public Shares if the share price of the OTR Common Stock is above the redemption price at the time of the Closing. Each Public Share that is redeemed will represent both (i) a reduction, equal to the amount of the redemption price, of the cash that will be available to Holdco following the consummation of the Business Combination and (ii) an increase in each Public Stockholder’s pro rata ownership interest in Holdco following the consummation of the Business Combination.

OTR or Comera may waive one or more of the conditions to the Business Combination.

OTR or Comera may agree to waive, in whole or in part, some of the conditions to its obligations to complete the Business Combination, to the extent permitted by OTR’s amended and restated certificate of incorporation, the Comera certificate of incorporation and applicable laws. For example, it is a condition to OTR’s obligations to close the Busines Combination that certain of Comera’s representations and warranties are true and correct in all respects as of the Closing, except where the failure of such representations and warranties to be true and correct, taken as a whole, does not result in a material adverse effect. However, if OTR’s board determines that it is in OTR Stockholders’ best interest to waive any such breach, then OTR’s board of directors may elect to waive that condition and consummate the Business Combination.

Notwithstanding the foregoing, certain closing conditions may not be waived due to the parties’ organizational documents, applicable law, or otherwise. The following closing conditions may not be waived: receipt of the requisite stockholder approvals, the Registration Statement having been declared effective and the absence of any law or order that would prohibit the consummation of the Business Combinations. The foregoing closing conditions are the only closing conditions to the Business Combinations that may not be waived. All other closing conditions to the Business Combinations may be waived by OTR or Comera. See the section “The Business Combinations Proposal — The Merger Agreement and the Transaction and Combination Agreement — Conditions to the Closing of the Business Combinations; Termination” for further information.

The OTR Warrants are accounted for as liabilities and the changes in value of the OTR Warrants could have a material effect on OTR’s financial results.

On April 12, 2021, the Acting Chief Accountant and Acting Director of the Division of Corporation Finance of the SEC published a statement on the SEC’s website indicating that the terms of the public and private warrants issued by many special purpose acquisition companies may need to be accounted for as liabilities, rather than as equity (the “SEC Warrant Accounting Statement”). As a result of the SEC Warrant Accounting Statement, OTR, along with many other current and former special purpose acquisition companies, concluded

 

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that the warrants should be presented as liabilities with subsequent fair value remeasurement and engaged a valuation firm to determine the fair market value of its warrants. Accordingly, OTR reevaluated the accounting treatment of its Public Warrants to purchase 5,223,675 shares of OTR Class A Common Stock and Private Warrants to purchase 5,817,757 shares of OTR Class A Common Stock, and determined to classify all of the warrants as derivative liabilities measured at fair value, with changes in fair value each period reported in earnings.

As a result, included on OTR’s balance sheet as of December 31, 2021 contained elsewhere in this proxy statement/prospectus are derivative liabilities related to embedded features contained within the OTR Warrants. Accounting Standards Codification 815, Derivatives and Hedging, provides for the remeasurement of the fair value of such derivatives at each balance sheet date, with a resulting non-cash gain or loss related to the change in the fair value being recognized in earnings in the statements of operations.

OTR’s Sponsor, executive officers and directors have potential conflicts of interest in recommending that stockholders vote in favor of approval of the Business Combination Proposal and approval of the other proposals described in this proxy statement/prospectus.

When considering OTR’s board of directors’ recommendation that its stockholders vote in favor of the approval of the Business Combination Proposal, OTR’s stockholders should be aware that the Sponsor and certain of OTR’s executive officers and directors have interests in the Business Combination that may be different from, or in addition to, the interests of OTR’s stockholders. These interests include:

 

   

the beneficial ownership of the Sponsor, which is controlled by Nicholas J. Singer, OTR’s Chairman and Chief Executive Officer, of an aggregate of 8,429,595 shares of OTR Common Stock, consisting of:

 

   

2,611,838 Founder Shares purchased by the Sponsor for an aggregate price of $25,000 (reflecting certain forfeitures to OTR in October and November of 2020 of 7,187,500 Founder Shares originally purchased in August 2020); and

 

   

5,817,757 shares of OTR Common Stock underlying Private Warrants, purchased by the Sponsor at a price of $1.00 per Private Warrant for an aggregate purchase price of approximately $5.8 million;

all of which shares and warrants would become worthless if OTR does not complete a business combination within the applicable time period, as the Sponsor has waived any right to redemption with respect to these shares. Such shares and warrants have an aggregate market value of approximately $[●] and $[●], respectively, based on the closing price of OTR Common Stock of $[●] and the closing price of OTR Warrants of $[●] on the Nasdaq on [●], 2022, the most recent practicable date;

 

   

the economic interests in the Sponsor held by certain of OTR’s officers and directors, which gives them an indirect pecuniary interest in the shares of OTR Common Stock and OTR Warrants held by the Sponsor, and which interests would also become worthless if OTR does not complete a business combination within the applicable time period, including the following:

 

   

in exchange for serving on OTR’s board of directors, (i) each of Mr. Gray, Mr. Besner and Mr. Rozwadowski received, or was promised to receive following the Closing, an economic interest in the Sponsor equivalent to 10,000 shares of OTR Common Stock and (ii) Mr. Neithardt received economic interest in the Sponsor equivalent to 50,613 shares of OTR Common Stock;

 

   

in exchange for serving on OTR’s board of directors and as an officer of OTR, (i) Mr. Singer received economic interest in the Sponsor equivalent to 602,347 shares of OTR Common Stock and (ii) Mr. Anderson received economic interest in the Sponsor equivalent to 15,000 shares of OTR Common Stock; and

 

   

other than Mr. Besner, each member of OTR’s board of directors made investments in the equity of the Sponsor as follows: (i) Mr. Singer, indirectly through certain entities, made an investment

 

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of $762,634, which gives Mr. Singer an economic interest in the Sponsor equivalent to an additional 261,172 shares of OTR Common Stock and 762,634 OTR Warrants, (ii) Mr. Anderson, indirectly through certain entities, made an investment of $25,000, which gives Mr. Anderson an economic interest in the Sponsor equivalent to an additional 8,562 shares of OTR Common Stock and 25,000 OTR Warrants, (iii) Mr. Neithardt, indirectly through certain entities, made an investment of $862,633, which gives Mr. Neithardt an economic interest in the Sponsor equivalent to an additional 295,418 shares of OTR Common Stock and 862,633 OTR Warrants, (iv) Mr. Gray made an investment of $100,000, which gives Mr. Gray an economic interest in the Sponsor equivalent to an additional 34,246 shares of OTR Common Stock and 100,000 OTR Warrants, and (v) Mr. Rozwadowski made an investment of $225,000, which gives Mr. Rozwadowski an economic interest in the Sponsor equivalent to an additional 61,875 shares of OTR Common Stock and 225,000 OTR Warrants;

 

   

the fact that Sponsor paid $25,000 or approximately $0.0096 per share for the Founders Shares (of which it currently holds 2,611,838), which such Founder Shares, if unrestricted and freely tradeable, would be valued at approximately $[●], based on the closing price of OTR Common Stock on [●], 2022, and that such shares will be worthless if a business combination is not consummated and that the Sponsor and its affiliates can earn a positive rate of return on their investment even if OTR’s public stockholders experience a negative return following the consummation of the Business Combination;

 

   

the anticipated appointment of William A. Wexler, as a director of the Combined Company following the Closing and his eligibility to participate in Holdco’s director compensation program following the consummation of the Business Combination;

 

   

the Sponsor or its affiliates or OTR’s officers and directors may make working capital loans to OTR prior to the closing of an initial business combination, up to $2,500,000 of which may be convertible into warrants similar to the Private Warrants at a price of $1.00 per warrant at the option of the lender, which may not be repaid if an initial business combination is not completed; the 2,500,000 warrants would have an aggregate market value of approximately $[●] million based on the last sale price of $[●] of the OTR Warrants on Nasdaq on [●], 2022. As of [●], 2022, no such working capital loans were outstanding;

 

   

the Sponsors, and OTR’s officers and directors or any of their respective affiliates are entitled to reimbursement for all out-of-pocket expenses incurred in connection with activities on OTR’s behalf such as identifying potential target businesses and performing due diligence on suitable business combinations (with no cap or ceiling on such reimbursement), but will not receive reimbursement for any out-of-pocket expenses to the extent such expenses exceed the amount not required to be retained in the Trust Account, unless an initial business combination is consummated. As of the date hereof, there were no unreimbursed out-of-pocket expenses; and

 

   

the continued indemnification of current directors and officers of OTR and the continuation of directors’ and officers’ liability insurance after the Business Combination.

These interests may influence OTR’s board of directors in making their recommendation that you vote in favor of the approval of the Business Combination Proposal. In particular, the existence of the interests described above may incentivize OTR’s officers and directors to complete an initial business combination, even if on terms less favorable to OTR’s stockholders compared to liquidating OTR, because, among other things, if OTR is liquidated without completing an initial business combination, the Founder Shares and Private Warrants would be worthless (which, if unrestricted and freely tradable, would be worth an aggregate of approximately $[●] based on the closing price of OTR Common Stock on [●], 2022), out-of-pocket expenses advanced by the Sponsor and loans made by the Sponsor to OTR would not be repaid to the extent such amounts exceed cash held by OTR outside of the Trust Account (which such expenses and loans, as of [●], amounted to $[●]). You should also read the section entitled “The Business Combination — Interests of OTR’s Directors and Officers in the Business Combination.”

 

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The exercise of discretion by OTR’s directors and officers in agreeing to changes to the terms of or waivers of closing conditions in the Business Combination Agreement may result in a conflict of interest when determining whether such changes to the terms of the Business Combination Agreement or waivers of conditions are appropriate and in the best interests of OTR Stockholders.

In the period leading up to the Closing, other events may occur that, pursuant to the Business Combination Agreement, would require OTR to agree to amend the Business Combination Agreement, to consent to certain actions or to waive rights that it is entitled to under those agreements. Such events could arise because of changes in the course of Comera’s business, a request by Comera to undertake actions that would otherwise be prohibited by the terms of the Business Combination Agreement or the occurrence of other events (including those that would have a material adverse effect on Comera’s business) and would entitle OTR to terminate the Business Combination Agreement. In any of such circumstances, it would be in OTR’s discretion, acting through OTR’s board of directors, to grant its consent or waive its rights. The existence of the financial and personal interests of the directors described elsewhere in this proxy statement/prospectus may result in a conflict of interest on the part of one or more of the directors between what he or she may believe is best for OTR and its securityholders and what he or she may believe is best for himself or herself or his or her affiliates in determining whether or not to take the requested action. As of the date of this proxy statement/prospectus, OTR does not believe there will be any changes or waivers that its directors and officers would be likely to make after stockholder approval of the Business Combinations has been obtained. While certain changes could be made without further stockholder approval, if there is a change to the terms of the transaction that would have a material impact on the OTR Stockholders, OTR will be required to circulate a new or amended proxy statement/prospectus or supplement thereto and resolicit the vote of its stockholders with respect to the Business Combination Proposal.

OTR’s stockholders will have a reduced ownership and voting interest after consummation of the Business Combination and will exercise less influence over management.

After the completion of the Business Combination, OTR’s stockholders will own a smaller percentage of Holdco than they currently own of OTR. Upon completion of the Business Combination and assuming the Earn-Out Shares are earned, it is anticipated that OTR’s stockholders, will own approximately 45.7%, of the Holdco Common Stock issued and outstanding immediately after the consummation of the Business Combination. Consequently, OTR’s stockholders, as a group, will have reduced ownership and voting power in Holdco compared to their ownership and voting power in OTR.

OTR’s Sponsor, executive officers and directors have agreed to vote in favor of the Business Combination, regardless of how the Public Stockholders vote.

Unlike many other blank check companies in which the founders, executive officers and directors agree to vote their founder shares in accordance with the majority of the votes cast by the public stockholders in connection with an initial business combination, OTR’s Sponsor, executive officers and directors have agreed (and their permitted transferees will agree), pursuant to the terms of a letter agreement entered into with OTR, to vote any shares of OTR Common Stock held by them in favor of the Business Combination. We expect that OTR’s Sponsor, executive officers and directors (and their permitted transferees) will own at least approximately 19.7% of the issued and outstanding shares of OTR Common Stock at the time of any such stockholder vote. Accordingly, it is more likely that the necessary stockholder approval will be received than would be the case if such persons agreed to vote their shares in accordance with the majority of the votes cast by the Public Stockholders.

OTR’s ability to successfully effect the Business Combination and the Combined Company’s ability to successfully operate the business thereafter will be largely dependent upon the efforts of certain key personnel of Comera, all of whom we expect to stay with the Combined Company following the Business Combination. The loss of such key personnel could negatively impact the operations and financial results of the combined business.

OTR’s ability to successfully effect the Business Combination and the Combined Company’s ability to successfully operate the business following the Closing is dependent upon the efforts of certain key personnel of

 

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Comera. Although we expect key personnel to remain with the Combined Company following the Business Combination, there can be no assurance that they will do so. It is possible that Comera will lose some key personnel, the loss of which could negatively impact the operations and profitability of the Combined Company. Furthermore, following the Closing, certain of the key personnel of Comera may be unfamiliar with the requirements of operating a company regulated by the SEC, which could cause the Combined Company to have to expend time and resources helping them become familiar with such requirements.

There are risks to OTR Stockholders who are not affiliates of the Sponsor of becoming stockholders of Holdco through the Business Combination rather than acquiring securities of Comera directly in an underwritten public offering, including no independent due diligence review by an underwriter and conflicts of interest of the Sponsor.

Because there is no independent third-party underwriter involved in the Business Combination or the issuance of Holdco Common Stock and Holdco Warrants in connection therewith, investors will not receive the benefit of any outside independent review of OTR’s and Comera’s respective finances and operations. Underwritten public offerings of securities conducted by a licensed broker-dealer are subjected to a due diligence review by the underwriter or dealer manager to satisfy statutory duties under the Securities Act, the rules of Financial Industry Regulatory Authority, Inc. (“FINRA”) and the national securities exchange where such securities are listed. Additionally, underwriters or dealer-managers conducting such public offerings are subject to liability for any material misstatements or omissions in a registration statement filed in connection with the public offering. As no such review will be conducted in connection with the Business Combination, OTR Stockholders must rely on the information in this proxy statement/prospectus and will not have the benefit of an independent review and investigation of the type normally performed by an independent underwriter in a public securities offering. Although OTR performed a due diligence review and investigation of Comera in connection with the Business Combination, OTR has different incentives and objectives in the Business Combination than an underwriter would in a traditional initial public offering. The lack of an independent due diligence review and investigation may increase the risk of an investment in Holdco because it may not have uncovered facts that would be important to a potential investor.

In addition, because Holdco will not become a public reporting company by means of a traditional underwritten initial public offering, securities or industry analysts may not provide, or may be less likely to provide, coverage of Holdco. Investment banks may also be less likely to agree to underwrite securities offerings on behalf of Holdco than they might if Holdco became a public reporting company by means of a traditional underwritten initial public offering, because they may be less familiar with Holdco as a result of more limited coverage by analysts and the media. The failure to receive research coverage or support in the market for the Holdco’s Common Stock could have an adverse effect on Holdco’s ability to develop a liquid market for Holdco’s Common Stock.

Certain of OTR’s officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by OTR and, accordingly, may have conflicts of interest in allocating their time and determining to which entity a particular business opportunity should be presented.

Until OTR consummates its initial business combination, it intends to engage in the business of identifying and combining with one or more businesses. The Sponsor and OTR’s officers and directors are, and may in the future become, affiliated with entities (such as operating companies or investment vehicles) that are engaged in a similar business, including other special purpose acquisition companies with a class of securities registered under the Exchange Act.

OTR’s officers and directors also may become aware of business opportunities which may be appropriate for presentation to OTR and the other entities to which they owe certain fiduciary or contractual duties. OTR’s amended and restated certificate of incorporation provides that it renounces its interest in any corporate

 

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opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as OTR’s director or officer and such opportunity is one OTR is legally and contractually permitted to undertake and would otherwise be reasonable for OTR to pursue, and to the extent the director or officer is permitted to refer that opportunity to OTR without violating any legal obligation.

In the absence of the “corporate opportunity” waiver in OTR’s amended and restated certificate of incorporation, certain candidates would not be able to serve as an officer or director. OTR believes it substantially benefits from having representatives who bring significant, relevant and valuable experience to its management, and, as a result, the inclusion of the “corporate opportunity” waiver in OTR’s amended and restated certificate of incorporation provides it with greater flexibility to attract and retain the officers and directors that it feels are the best candidates.

However, the personal and financial interests of OTR’s directors and officers may influence their motivation in timely identifying and selecting a target business and completing a business combination. The different timelines of competing business combinations could cause OTR’s directors and officers to prioritize a different business combination over finding a suitable acquisition target for OTR’s initial business combination. Consequently, OTR’s directors’ and officers’ discretion in identifying and selecting a suitable target business may result in a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate and in OTR stockholders’ best interest, which could negatively impact the timing for a business combination. OTR is not aware of any such conflicts of interest and does not believe that any such conflicts of interest impacted OTR’s search for an acquisition target.

The Combined Company may redeem your unexpired Holdco Warrants prior to their exercise at a time that is disadvantageous to you, thereby making your Holdco Warrants worthless.

The Combined Company will have the ability to redeem outstanding Holdco Warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the last reported sales price of Holdco Common Stock equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Combined Company gives notice of redemption. If and when the Holdco Warrants become redeemable by the Combined Company, the Combined 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. Redemption of the outstanding Holdco Warrants could force you (i) to exercise your Holdco Warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your Holdco Warrants at the then-current market price when you might otherwise wish to hold your Holdco Warrants or (iii) to accept the nominal redemption price which, at the time the outstanding Holdco Warrants are called for redemption, is likely to be substantially less than the market value of your Holdco Warrants. None of the Private Warrants will be redeemable by the Combined Company so long as they are held by their initial purchasers or their permitted transferees.

We may issue additional shares of Holdco Common Stock or shares of preferred stock under an employee incentive plan upon or after consummation of the Business Combination, which would dilute the interest of our stockholders.

The Holdco Charter authorizes the issuance of 150,000,000 shares of common stock, and 1,000,000 shares of preferred stock, in each case, par value $0.0001 per share. We may issue a substantial number of additional shares of Holdco Common Stock or shares of preferred stock under an employee incentive plan upon or after consummation of the Business Combination. The issuance of additional Holdco Common Stock or preferred shares:

 

   

may significantly dilute the equity interest of investors from the IPO, who will not have preemption rights in respect of such an issuance;

 

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may subordinate the rights of holders of shares of Holdco Common Stock if one or more classes of preferred stock are created, and such preferred shares are issued, with rights senior to those afforded to Holdco Common Stock;

 

   

could cause a change in control if a substantial number of shares of Holdco Common Stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; and

 

   

may adversely affect prevailing market prices for our Holdco Common Stock and/or Holdco Warrants.

The Holdco Charter will contain anti-takeover provisions that could adversely affect the rights of our stockholders.

The Holdco Charter will contain provisions to limit the ability of others to acquire control of Holdco or cause it to engage in change-of-control transactions, including, among other things:

 

   

provisions that authorize its board of directors, without action by its stockholders, to issue additional shares of Holdco Common Stock and preferred stock with preferential rights determined by its board of directors;

 

   

provisions that permit only a majority of its board of directors, the chairperson of the board of directors or the chief executive officer to call stockholder meetings and therefore do not permit stockholders to call special meetings of the stockholders;

 

   

provisions limiting stockholders’ ability to act by written consent; and

 

   

a staggered board whereby our directors are divided into three classes, with each class subject to retirement and re-election once every three years on a rotating basis.

These provisions could have the effect of depriving Holdco’s stockholders of an opportunity to sell their Holdco Common Stock at a premium over prevailing market prices by discouraging third parties from seeking to obtain control of our company in a tender offer or similar transaction. With its staggered board of directors, at least two annual or special meetings of stockholders will generally be required in order to effect a change in a majority of its directors. Holdco’s staggered board of directors can discourage proxy contests for the election of its directors and purchases of substantial blocks of its shares by making it more difficult for a potential acquirer to gain control of its board of directors in a relatively short period of time.

The Holdco Charter will provide, subject to limited exceptions, that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for certain stockholder litigation matters, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or stockholders.

The Holdco Charter provides that unless Holdco consents in writing to the selection of an alternative forum, and subject to applicable jurisdictional requirements, the sole and exclusive forum for (1) any derivative action or proceeding brought on behalf of Holdco, (2) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, employee, agent or shareholder of Holdco to Holdco or the Holdco shareholders, (3) any action asserting a claim arising pursuant to any provision of the DGCL, the Holdco Charter, or (4) any action asserting a claim governed by the internal affairs doctrine shall be the Court of Chancery of the State of Delaware (or, if the Court of Chancery of the State of Delaware lacks jurisdiction over such action or proceeding, then the United States District Court for the District of Delaware or another court of the State of Delaware). The Holdco Charter also provides that, unless Holdco consents in writing to the selection of an alternative forum, the federal district courts of the United States will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act

 

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or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction.

The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage such lawsuits against us and our directors, officers, and other employees. Alternatively, if a court were to find the choice of forum provision contained in the amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, results of operations, and financial condition.

Additionally, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. As noted above, the amended and restated certificate of incorporation will provide that the federal district courts of the United States of America will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. Accordingly, there is uncertainty as to whether a court would enforce such provision. Our stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.

Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and consented to the forum provisions in the Holdco Charter.

We may be the target of securities class action and derivative lawsuits which could result in substantial costs and may delay or prevent the Business Combination from being completed.

Securities class action lawsuits and derivative lawsuits are often brought against public companies that have entered into merger or business combination agreements. Even if the lawsuits are without merit, defending against these claims can result in substantial costs and divert management time and resources. An adverse judgment could result in monetary damages, which could have a negative impact on OTR’s or Comera’s liquidity and financial condition. Additionally, if a plaintiff is successful in obtaining an injunction prohibiting completion of the Business Combination, then that injunction may delay or prevent the Business Combination from being completed, which may adversely affect OTR’s or Comera’s or, if the Business Combination is completed but delayed, the Combined Company’s business, financial position and results of operations. We cannot predict whether any such lawsuits will be filed.

The Combined Company may be subject to securities litigation, which is expensive and could divert management attention.

Following the Business Combination, the Combined Company’s share price may be volatile and, in the past, companies that have experienced volatility in the market price of their stock have been subject to securities litigation, including class action litigation. The Combined Company may be the target of this type of litigation in the future. Litigation of this type could result in substantial costs and diversion of management’s attention and resources, which could have a material adverse effect on the Combined Company’s business, financial condition, and results of operations. Any adverse determination in litigation could also subject the Combined Company to significant liabilities.

Because we have no current plans to pay cash dividends on Holdco Common Stock for the foreseeable future, you may not receive any return on investment unless you sell Holdco Common Stock for a price greater than that which you paid for it.

We may retain future earnings, if any, for future operations, expansion and debt repayment and have no current plans to pay any cash dividends for the foreseeable future. Any decision to declare and pay dividends as a

 

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public company in the future will be made at the discretion of Holdco’s board of directors and will depend on, among other things, our results of operations, financial condition, cash requirements, contractual restrictions and other factors that Holdco’s board of directors may deem relevant. In addition, our ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness we or our subsidiaries incur. As a result, you may not receive any return on an investment in Holdco Common Stock unless you sell Holdco Common Stock for a price greater than that which you paid for it. See the section entitled “Market Price and Dividend Information.”

General Risk Factors

Comera’s business is subject to the risks of earthquakes, fires, floods and other natural catastrophic events, global pandemics and interruptions by man-made problems, such as terrorism. Material disruptions of Comera’s business or information systems resulting from these events could adversely affect its operating results.

A significant natural disaster, such as an earthquake, fire, flood, hurricane or significant power outage or other similar events, such as infectious disease outbreaks or pandemic events, including the ongoing COVID-19 pandemic, could have an adverse effect on Comera’s business and operating results. The ongoing COVID-19 pandemic may have the effect of heightening many of the other risks described in this “Risk Factors” section, such as the demand for Comera’s products, its ability to achieve or maintain profitability and its ability to raise additional capital in the future. In addition, natural disasters, acts of terrorism or war could cause disruptions in Comera’s remaining manufacturing operations, Comera’s or its customers’ or channel partners’ businesses, Comera’s suppliers’ or the economy as a whole. Comera also relies on information technology systems to communicate among its workforce and with third parties. Any disruption to Comera’s communications, whether caused by a natural disaster or by manmade problems, such as power disruptions, could adversely affect its business. Comera does not have a formal disaster recovery plan or policy in place and does not currently require that its suppliers’ partners have such plans or policies in place. To the extent that any such disruptions result in delays or cancellations of orders or impede its suppliers’ ability to timely deliver product components, or the deployment of its products, Comera’s business, operating results and financial condition would be adversely affected.

Interruption or failure of Comera’s information technology and communications systems could impact Comera’s ability to effectively provide its products and services.

Comera plans to include services and functionality that utilize data connectivity to monitor performance and timely capture opportunities to enhance performance and functionality. The availability and effectiveness of Comera’s services depend on the continued operation of information technology and communications systems. Comera’s systems will be vulnerable to damage or interruption from, among others, physical theft, fire, terrorist attacks, natural disasters, power loss, war, telecommunications failures, viruses, denial or degradation of service attacks, ransomware, social engineering schemes, insider theft or misuse or other attempts to harm Comera’s systems. Comera utilizes reputable third-party service providers or vendors for all of its data other than its source code, and these providers could also be vulnerable to harms similar to those that could damage Comera’s systems, including sabotage and intentional acts of vandalism causing potential disruptions. Some of Comera’s systems will not be fully redundant, and Comera’s disaster recovery planning cannot account for all eventualities. Any problems with Comera’s third-party cloud hosting providers could result in lengthy interruptions in Comera’s business. In addition, Comera’s services and functionality are highly technical and complex technology which may contain errors or vulnerabilities that could result in interruptions in Comera’s business or the failure of its systems.

 

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Comera is subject to cybersecurity risks to operational systems, security systems, infrastructure, and customer data processed by Comera or third-party vendors or suppliers and any material failure, weakness, interruption, cyber event, incident or breach of security could prevent Comera from effectively operating its business.

Comera is at risk for interruptions, outages and breaches of: operational systems, including business, financial, accounting, product development, data processing or production processes, owned by Comera or its third-party vendors or suppliers; facility security systems, owned by Comera or its third-party vendors or suppliers; in-product technology owned by Comera or its third-party vendors or suppliers; or customer or driver data that Comera processes or its third-party vendors or suppliers process on its behalf. Such cyber incidents could materially disrupt operational systems; result in loss of intellectual property, trade secrets or other proprietary or competitively sensitive information; compromise certain information of customers, employees, suppliers, drivers or others; or jeopardize the security of Comera’s facilities. A cyber incident could be caused by disasters, insiders (through inadvertence or with malicious intent) or malicious third parties (including nation-states or nation-state supported actors) using sophisticated, targeted methods to circumvent firewalls, encryption and other security defenses, including hacking, fraud, trickery or other forms of deception. The techniques used by cyber attackers change frequently and may be difficult to detect for long periods of time. Although Comera maintains information technology measures designed to protect itself against intellectual property theft, data breaches and other cyber incidents, such measures will require updates and improvements, and Comera cannot guarantee that such measures will be adequate to detect, prevent or mitigate cyber incidents. The implementation, maintenance, segregation and improvement of these systems requires significant management time, support and cost. Moreover, there are inherent risks associated with developing, improving, expanding and updating current systems, including the disruption of Comera’s data management, procurement, production execution, finance, supply chain and sales and service processes. These risks may affect Comera’s ability to manage its data and inventory, procure parts or supplies or produce, sell, deliver and service its products, adequately protect its intellectual property or achieve and maintain compliance with, or realize available benefits under, applicable laws, regulations and contracts. Comera cannot be sure that the systems upon which it relies, including those of its third-party vendors or suppliers, will be effectively implemented, maintained or expanded as planned. If Comera does not successfully implement, maintain or expand these systems as planned, its operations may be disrupted, its ability to accurately and timely report its financial results could be impaired, and deficiencies may arise in its internal control over financial reporting, which may impact Comera’s ability to certify its financial results. Moreover, Comera’s proprietary information or intellectual property could be compromised or misappropriated and its reputation may be adversely affected. If these systems do not operate as Comera expects them to, Comera may be required to expend significant resources to make corrections or find alternative sources for performing these functions.

A significant cyber incident could impact production capability, harm Comera’s reputation, cause Comera to breach its contracts with other parties or subject Comera to regulatory actions or litigation, any of which could materially affect Comera’s business, prospects, financial condition and operating results. In addition, Comera’s insurance coverage for cyber-attacks may not be sufficient to cover all the losses it may experience as a result of a cyber-incident.

The requirements of being a public company may strain Comera’s resources and divert management’s attention, and the increases in legal, accounting and compliance expenses that will result from the proposed transaction may be greater than Comera anticipates.

Comera may incur significant costs associated with its public company corporate governance and reporting requirements. This may divert the attention of Comera’s management from other business concerns, which could have a material adverse effect on its business, financial condition and results of operations.

 

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UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

Pursuant to applicable legislation, we are omitting any financial statements for the nine months ended September 30, 2021, and the year ended December 31, 2019, because they relate to historical periods that we believe will not be required to be included in this proxy statement/prospectus at the time of the contemplated offering. We intend to amend this Registration Statement to include all financial information required by Regulation S-X prior to effectiveness of this Registration Statement.

The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2021 give pro forma effect to the Business Combination as if it had occurred on January 1, 2021. The unaudited pro forma condensed combined balance sheet as of December 31, 2021 gives pro forma effect to the Business Combination as if it was completed on December 31, 2021.

The unaudited pro forma condensed combined financial information is based on and should be read in conjunction with:

 

   

the accompanying notes to the unaudited pro forma condensed combined financial information;

 

   

the historical financial statements of OTR as of and for the year ended December 31, 2021, and the related notes, included elsewhere in this proxy statement/prospectus;

 

   

the historical financial statements of Comera as of and for the year ended December 31, 2021, and the related notes, included elsewhere in this proxy statement/prospectus; and

 

   

other information relating to OTR and Comera included in this proxy statement/prospectus, including the Business Combination Agreement and the description of certain terms thereof set forth under “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement”, as well as the disclosures contained in the sections titled “OTR Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Comera Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

The pro forma financial information has been prepared in accordance with Regulation S-X Article 11, Pro Forma Financial Information, as amended by the final rule, Amendments to Financial Disclosures about Acquired and Disposed Businesses, as adopted by the SEC in May 2020 (“Article 11”). The amended Article 11 became effective on January 1, 2021. The unaudited pro forma condensed combined financial statements have been presented for illustrative purposes only and do not necessarily reflect what the combined company’s financial condition or results of operations would have been had the Business Combination occurred on the dates indicated. Further, the unaudited pro forma condensed combined financial information also may not be useful in predicting the future financial condition and results of operations of the combined company. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors. The unaudited pro forma transaction accounting adjustments represent management’s estimates based on information available as of the date of these unaudited pro forma condensed combined financial statements and are subject to change as additional information becomes available and analyses are performed.

On January 31, 2022, OTR, Holdco, Comera Merger Sub, OTR Merger Sub and Comera entered into the Business Combination Agreement, pursuant to which (i) Comera Merger Sub will be merged with and into Comera, with Comera surviving the Comera Merger as a direct wholly-owned subsidiary of Holdco and (ii) OTR Merger Sub will be merged with and into OTR, with OTR surviving the OTR Merger as a direct wholly-owned subsidiary of Holdco.

The unaudited pro forma condensed combined financial information has been prepared using two alternative levels of redemption of shares of OTR Class A Common Stock into cash:

 

   

Scenario 1 — No redemption: This presentation applies the assumption that no Public Stockholders exercise redemption rights with respect to their redeemable OTR Class A Common Stock upon consummation of the Business Combination; and

 

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Scenario 2 — Maximum redemptions of OTR Class A Common Stock: This presentation assumes that Public Stockholders holding approximately 10,447,350 shares of redeemable OTR Class A Common Stock will exercise their redemption rights upon consummation of the Business Combination at a redemption price of approximately $10.25 per share, which is the maximum amount of redemptions that could occur and still ensure that OTR meets its requirement to maintain net tangible assets of at least $5,000,001.

As a result of the Business Combination, if none of the redeemable OTR Class A Common Stock is redeemed, the former stockholders of Comera and former stockholders of OTR will own approximately [●]% and [●]%, respectively, of Holdco.

As a result of the Business Combination, if the maximum number of shares of OTR Class A Common Stock is redeemed, after taking into consideration the minimum cash condition, the former stockholders of Comera and former stockholders of OTR will own approximately [●]% and [●]%, respectively, of Holdco.

In addition, an equity incentive plan (comprised of a to-be determined number of shares of Holdco Common Stock at Closing prior to any redemptions) will be adopted at the Closing initially aimed to be comprised of 10.0% of Holdco’s fully diluted shares outstanding (such 10.0% to be inclusive of the unvested incentive equity awards assumed by OTR at Closing). The equity incentive plan will be in line with other U.S. public companies and will be created for the benefit of Holdco’s management, the Holdco Board and employees. The final impact of the equity incentive plan has not been included in the unaudited pro forma condensed combined financial statement as it cannot be reliably estimated at this stage.

For a detailed understanding of the pro forma adjustments and the total basic and diluted shares outstanding as a result of the Business Combination, see Note [●] to these unaudited pro forma condensed combined financial statements. The pro forma adjustments have been prepared excluding the impact of post balance sheet events that are not the result of the Business Combination.

 

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COMPARATIVE SHARE INFORMATION

 

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THE SPECIAL MEETING OF OTR STOCKHOLDERS

The OTR Special Meeting

OTR is furnishing this proxy statement/prospectus to you as part of the solicitation of proxies by its board of directors for use at the special meeting in lieu of the 2022 annual meeting of stockholders to be held on [●], 2022, and at any adjournment or postponement thereof. This proxy statement/prospectus is first being mailed on or about [●], 2022 to all OTR stockholders of record as of [●], 2022, the record date for the special meeting. This proxy statement/prospectus provides you with information you need to know to be able to vote or instruct your vote to be cast at the special meeting of stockholders.

Date, Time and Place of the Special Meeting

In light of public health concerns regarding the coronavirus (COVID-19) pandemic, the special meeting will be held via live webcast at [●], on [●], 2022, at [●], or such other date, time and place to which such special meeting may be adjourned or postponed. The special meeting can be accessed by visiting [], where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen to the special meeting by dialing [●] (toll-free within the U.S. and Canada) or [●] (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is [●], but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the special meeting by means of remote communication. Please have your control number, which can be found on your proxy card, to join the special meeting. If you do not have a control number, please contact the transfer agent, Continental Stock Transfer & Trust Company, at (917) 262-2373 or by e-mail at proxy@continentalstock.com.

Purpose of the Special Meeting

At the OTR special meeting of stockholders, OTR will ask the OTR stockholders to vote in favor of the following proposals:

 

   

The Business Combination Proposal — a proposal to approve the adoption of the Business Combination Agreement and the Business Combination (Proposal No. 1).

 

   

The Charter Amendment Proposal — a proposal to consider and vote on, on a non-binding advisory basis, three separate governance proposals relating to the material differences between OTR’s current amended and restated certificate of incorporation and the Amended and Restated Certificate of Incorporation of Holdco (Proposal Nos. 2A – 2C).

 

   

The Equity Incentive Award Plan Proposal — a proposal to approve and adopt the equity incentive award plan established to be effective after the Closing of the Business Combination (Proposal No. 3).

 

   

The Adjournment Proposal — a proposal to authorize the adjournment of the special meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based on the tabulated vote at the time of the special meeting, there are not sufficient votes to approve the Business Combination Proposal (Proposal No. 4).

Recommendation of the OTR Board of Directors

OTR’s board of directors believes that each of the proposals to be presented at the special meeting of stockholders is in the best interests of OTR and its stockholders and unanimously recommends that its stockholders vote “FOR” each of the proposals.

When you consider the recommendation of OTR’s board of directors in favor of approval of the Business Combination Proposal, you should keep in mind that certain of OTR’s board of directors and officers have

 

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interests in the Business Combination that are different from, or in addition to, your interests as a stockholder. These interests include, among other things:

 

   

the beneficial ownership of the Sponsor, which is controlled by Nicholas J. Singer, OTR’s Chairman and Chief Executive Officer, of an aggregate of 8,429,595 shares of OTR Common Stock, consisting of:

 

   

2,611,838 Founder Shares purchased by the Sponsor for an aggregate price of $25,000 (reflecting certain forfeitures to OTR in October and November of 2020 of 7,187,500 Founder Shares originally purchased in August 2020); and

 

   

5,817,757 shares of OTR Common Stock underlying Private Warrants, purchased by the Sponsor at a price of $1.00 per Private Warrant for an aggregate purchase price of approximately $5.8 million;

all of which shares and warrants would become worthless if OTR does not complete a business combination within the applicable time period, as the Sponsor has waived any right to redemption with respect to these shares. Such shares and warrants have an aggregate market value of approximately $[●] and $[●], respectively, based on the closing price of OTR Common Stock of $[●] and the closing price of OTR Warrants of $[●] on the Nasdaq on [●], 2022, the most recent practicable date;

 

   

the economic interests in the Sponsor held by certain of OTR’s officers and directors, which gives them an indirect pecuniary interest in the shares of OTR Common Stock and OTR Warrants held by the Sponsor, and which interests would also become worthless if OTR does not complete a business combination within the applicable time period, including the following:

 

   

in exchange for serving on OTR’s board of directors, (i) each of Mr. Gray, Mr. Besner and Mr. Rozwadowski received, or was promised to receive following the Closing, an economic interest in the Sponsor equivalent to 10,000 shares of OTR Common Stock and (ii) Mr. Neithardt received economic interest in the Sponsor equivalent to 50,613 shares of OTR Common Stock;

 

   

in exchange for serving on OTR’s board of directors and as an officer of OTR, (i) Mr. Singer received economic interest in the Sponsor equivalent to 602,347 shares of OTR Common Stock and (ii) Mr. Anderson received economic interest in the Sponsor equivalent to 15,000 shares of OTR Common Stock; and

 

   

other than Mr. Besner, each member of OTR’s board of directors made investments in the equity of the Sponsor as follows: (i) Mr. Singer, indirectly through certain entities, made an investment of $762,634, which gives Mr. Singer an economic interest in the Sponsor equivalent to an additional 261,172 shares of OTR Common Stock and 762,634 OTR Warrants, (ii) Mr. Anderson, indirectly through certain entities, made an investment of $25,000, which gives Mr. Anderson an economic interest in the Sponsor equivalent to an additional 8,562 shares of OTR Common Stock and 25,000 OTR Warrants, (iii) Mr. Neithardt, indirectly through certain entities, made an investment of $862,633, which gives Mr. Neithardt an economic interest in the Sponsor equivalent to an additional 295,418 shares of OTR Common Stock and 862,633 OTR Warrants, (iv) Mr. Gray made an investment of $100,000, which gives Mr. Gray an economic interest in the Sponsor equivalent to an additional 34,246 shares of OTR Common Stock and 100,000 OTR Warrants, and (v) Mr. Rozwadowski made an investment of $225,000, which gives Mr. Rozwadowski an economic interest in the Sponsor equivalent to an additional 61,875 shares of OTR Common Stock and 225,000 OTR Warrants;

 

   

the fact that Sponsor paid $25,000 or approximately $0.0096 per share for the Founders Shares (of which it currently holds 2,611,838), which such Founder Shares, if unrestricted and freely tradeable, would be valued at approximately $[●], based on the closing price of OTR Common Stock on [●], 2022, and that such shares will be worthless if a business combination is not consummated and that the Sponsor and its affiliates can earn a positive rate of return on their investment even if OTR’s public stockholders experience a negative return following the consummation of the Business Combination;

 

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the anticipated appointment of William A. Wexler, as a director of the Combined Company following the Closing and his eligibility to participate in Holdco’s director compensation program following the consummation of the Business Combination;

 

   

the Sponsor or its affiliates or OTR’s officers and directors may make working capital loans to OTR prior to the closing of an initial business combination, up to $2,500,000 of which may be convertible into warrants similar to the Private Warrants at a price of $1.00 per warrant at the option of the lender, which may not be repaid if an initial business combination is not completed; the 2,500,000 warrants would have an aggregate market value of approximately $[●] million based on the last sale price of $[●] of the OTR Warrants on Nasdaq on [●], 2022. As of [●], 2022, no such working capital loans were outstanding;

 

   

the Sponsors, and OTR’s officers and directors or any of their respective affiliates are entitled to reimbursement for all out-of-pocket expenses incurred in connection with activities on OTR’s behalf such as identifying potential target businesses and performing due diligence on suitable business combinations (with no cap or ceiling on such reimbursement), but will not receive reimbursement for any out-of-pocket expenses to the extent such expenses exceed the amount not required to be retained in the Trust Account, unless an initial business combination is consummated. As of the date hereof, there were no unreimbursed out-of-pocket expenses; and

 

   

the continued indemnification of current directors and officers of OTR and the continuation of directors’ and officers’ liability insurance after the Business Combination.

These interests may influence OTR’s board of directors in making their recommendation that you vote in favor of the approval of the Business Combination Proposal. In particular, the existence of the interests described above may incentivize OTR’s officers and directors to complete an initial business combination, even if on terms less favorable to OTR’s stockholders compared to liquidating OTR, because, among other things, if OTR is liquidated without completing an initial business combination, the Founder Shares and Private Warrants would be worthless (which, if unrestricted and freely tradable, would be worth an aggregate of approximately $[●] based on the closing price of OTR Common Stock on [●], 2022), out-of-pocket expenses advanced by the Sponsor and loans made by the Sponsor to OTR would not be repaid to the extent such amounts exceed cash held by OTR outside of the Trust Account (which such expenses and loans, as of [●], amounted to $[●]). You should also read the section entitled “The Business Combination — Interests of OTR’s Directors and Officers in the Business Combination.”

Record Date and Voting

You will be entitled to vote or direct votes to be cast at the special meeting of stockholders if you owned shares of OTR Common Stock at the close of business on [●], 2022, which is the record date for the special meeting of stockholders. You are entitled to one vote for each share of OTR Common Stock that you owned as of the close of business on the record date. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker, bank or other nominee to ensure that votes related to the shares you beneficially own are properly counted. On the record date, there were [●] shares of OTR Common Stock outstanding, of which [●] are Founder Shares held by the Sponsor.

The Sponsor has agreed to vote all of its Founder Shares and any Public Shares acquired by it in favor of the Business Combination Proposal. The issued and outstanding OTR Warrants do not have voting rights at the special meeting of stockholders.

Voting Your Shares

Each share of OTR Common Stock that you own in your name entitles you to one vote on each of the proposals for the special meeting of stockholders. Your one or more proxy cards show the number of shares of OTR Common Stock that you own.

 

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If you are a holder of record, there are two ways to vote your shares of OTR Common Stock at the special meeting of stockholders:

 

   

Voting by Mail. You can vote by completing, signing and returning the enclosed proxy card in the postage-paid envelope provided. If you hold your shares in “street name” through a bank, broker or other nominee, you will need to follow the instructions provided to you by your bank, broker or other nominee to ensure that your shares are represented and voted at the applicable special meeting(s). If you vote by proxy card, your “proxy,” whose name is listed on the proxy card, will vote your shares as you instruct on the proxy card. If you sign and return the proxy card but do not give instructions on how to vote your shares, your shares of OTR Common Stock will be voted as recommended by OTR’s board of directors. OTR encourages you to sign and return the proxy card even if you plan to attend the special meeting so that your shares will be voted if you are unable to attend the special meeting.

 

   

Voting at the Special Meeting via the Virtual Meeting Platform. You can attend the special meeting and vote in person via the virtual meeting platform. The special meeting can be accessed by visiting [], where you will be able to listen to the meeting live and vote during the meeting. Additionally, you have the option to listen to the special meeting by dialing [●] (toll-free within the U.S. and Canada) or [●] (outside of the U.S. and Canada, standard rates apply). The passcode for telephone access is [●], but please note that you cannot vote or ask questions if you choose to participate telephonically. Please note that you will only be able to access the special meeting by means of remote communication. If your shares of OTR Common Stock are registered directly in your name, you are considered the stockholder of record and you have the right to vote in person via the virtual meeting platform at the special meeting. If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or other nominee, you should follow the instructions provided by your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the record holder of your shares with instructions on how to vote your shares or, if you wish to attend the special meeting and vote in person via the virtual meeting platform, you will need to contact your broker, bank or nominee to obtain a legal proxy that will authorize you to vote these shares. Please have your control number, which can be found on your proxy card, to join the special meeting. If you do not have a control number, please contact the transfer agent.

Who Can Answer Your Questions About Voting Your Shares

If you have any questions about how to vote or direct a vote in respect of your shares of OTR Common Stock, you may contact our proxy solicitor at:

[●]

[●]

Telephone: [●]

Banks and brokers can call collect at: [●]

Email: [●]

Quorum and Vote Required for the OTR Proposals

A quorum of OTR’s stockholders is necessary to hold a valid meeting. A quorum will be present at the special meeting of stockholders if a majority of the voting power of the OTR Common Stock outstanding and entitled to vote at the meeting is represented in person or by proxy. Abstentions will count as present for the purposes of establishing a quorum.

The approval of the Business Combination Proposal requires the affirmative vote of the holders of a majority of the then outstanding shares of OTR Common Stock and the Charter Amendment Proposal, Equity Incentive Award Plan Proposal and Adjournment Proposal require the affirmative vote in person (which would include presence at a virtual meeting) or by proxy of the holders of a majority of the then outstanding shares of OTR Common Stock present and entitled to vote at the special meeting and voted in connection with the applicable proposal.

 

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Abstentions and Broker Non-Votes

Under the rules of various national and regional securities exchanges, your broker, bank or nominee cannot vote your shares with respect to non-discretionary matters unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank or nominee. OTR believes the proposals presented to its stockholders will be considered non-discretionary and therefore your broker, bank or nominee cannot vote your shares without your instruction. If you do not provide instructions with your proxy, your bank, broker or other nominee may deliver a proxy card expressly indicating that it is NOT voting your shares; this indication that a bank, broker or nominee is not voting your shares is referred to as a “broker non-vote.”

Abstentions will be counted for purposes of determining the presence of a quorum at the special meeting of OTR stockholders. For purposes of approval, abstentions will have the same effect as a vote “against” the Business Combination Proposal and will have no effect on the Charter Amendment Proposal, Equity Incentive Award Plan Proposal or Adjournment Proposal, if presented. Broker non-votes will have the same effect as a vote “against” the Business Combination Proposal and will have no effect on the remaining proposals.

Revocability of Proxies

If you are a stockholder of record and you give a proxy, you may revoke it at any time before it is exercised by doing any one of the following:

 

   

you may send another proxy card with a later date;

 

   

you may notify OTR’s secretary in writing before the annual meeting that you have revoked your proxy; or

 

   

you may attend the special meeting virtually and submit a ballot through the virtual meeting platform during the special meeting, as indicated above.

If you hold your shares in “street name,” you should contact your broker, bank or nominee to change your instructions on how to vote.

Appraisal or Dissenters’ Rights

No appraisal or dissenters’ rights are available to holders of shares of OTR Common Stock or OTR Warrants in connection with the Business Combination.

Solicitation of Proxies

OTR will pay the cost of soliciting proxies for the special meeting. OTR has engaged [●] to assist in the solicitation of proxies for the special meeting. OTR has agreed to pay [●] a fee of $[●]. OTR will reimburse [●] for reasonable out-of-pocket expenses and will indemnify [●] and its affiliates against certain claims, liabilities, losses, damages and expenses. OTR also will reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of shares of OTR Common Stock for their expenses in forwarding soliciting materials to beneficial owners of OTR Common Stock and in obtaining voting instructions from those owners. OTR’s directors, officers and employees may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person. They will not be paid any additional amounts for soliciting proxies.

Stock Ownership

As of the record date, the Sponsor beneficially owned an aggregate of approximately [●]% of the outstanding shares of OTR Common Stock. The Sponsor has agreed to vote all of its Founder Shares and any Public Shares acquired by it in favor of the Business Combination Proposal. As of the date of this proxy statement/prospectus, the Sponsor has not acquired any Public Shares.

 

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PROPOSALS TO BE CONSIDERED BY OTR’S STOCKHOLDERS

PROPOSAL NO. 1 — THE BUSINESS COMBINATION PROPOSAL

THE BUSINESS COMBINATION

The Background of the Business Combination

OTR is a blank check company that was incorporated in Delaware on July 23, 2020, formed for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization, recapitalization, or other similar business combination with one or more businesses. The Business Combination was the result of an extensive search for a potential transaction utilizing the global network and investing and operating experience of our management team and the OTR board of directors. The terms of the Business Combination were the result of extensive arm’s-length negotiations between OTR’s management team, in consultation with its board of directors and financial and legal advisors, the Sponsor, and representatives of Comera, in consultation with Comera’s financial and legal advisors.

Comera’s management team and board of directors, together with its financial and legal advisors, reviewed and evaluated potential strategic opportunities and alternatives with a view to enhancing stockholder value. Such opportunities and alternatives included, among other things, capital markets transactions and possible acquisitions.

The following is a brief description of the background of these negotiations, the Business Combination, and related transactions. The following does not purport to catalogue every conversation among representatives of OTR, Comera and other parties.

On November 19, 2020, OTR consummated its IPO of 10,000,000 OTR Units at an offering price of $10.00 per Unit, with each Unit consisting of one share of OTR Common Stock and one-half of one OTR Warrant, resulting in gross proceeds of $100.0 million (before underwriting discounts and commissions and offering expenses). The underwriters were granted a 45-day option from the date of the final prospectus relating to the IPO to purchase up to 1,500,000 additional Units (the “Over-Allotment Units”) to cover over-allotments, if any, at $10.00 per Unit. On November 19, 2020, the underwriters partially exercised their over-allotment option resulting in the purchase of an additional 447,350 Units. The underwriters waived their right to exercise the remaining over-allotment option on December 21, 2020.

Simultaneously with the closing of the IPO, OTR consummated the private placement of 5,650,000 warrants (each, a “Private Warrant” and collectively, the “Private Warrants”) to the Sponsor, each exercisable to purchase one share of Class A Common Stock at $11.50 per share, at a price of $1.00 per Private Warrant, generating gross proceeds to us of $5.7 million. In connection with the partial exercise of the underwriter’s over-allotment option, our Sponsor purchased an additional 167,757 Private Warrants at a price of $1.00 per Private Warrant, generating additional gross proceeds of $167,757.

Prior to the consummation of the IPO, neither OTR, nor anyone on its behalf, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a transaction with OTR.

OTR’s efforts to identify a prospective target business was not limited to a particular industry or geographic region. OTR’s management considered a variety of factors in evaluating prospective target businesses, including, but not limited to, the following:

 

   

financial condition and results of operation;

 

   

growth potential;

 

   

brand recognition and potential;

 

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experience and skill of management and availability of additional personnel;

 

   

capital requirements;

 

   

competitive position;

 

   

barriers to entry;

 

   

stage of development of the products, processes or services;

 

   

existing distribution and potential for expansion;

 

   

degree of current or potential market acceptance of the products, processes or services;

 

   

proprietary aspects of products and the extent of intellectual property or other protection for products or formulas;

 

   

impact of regulation on the business;

 

   

regulatory environment of the industry;

 

   

costs associated with effecting the business combination;

 

   

industry leadership, sustainability of market share and attractiveness of market industries in which a target business participates; and

 

   

macro competitive dynamics in the industry within which the company competes.

After its IPO, OTR’s officers and directors commenced an active search for prospective businesses or assets to acquire in an initial business combination. Representatives of OTR were contacted by, and representatives of OTR contacted, numerous individuals, financial advisors and other entities who offered to present ideas for business combination opportunities. OTR’s officers and directors and their affiliates also brought to OTR’s attention target business candidates.

During that period, OTR’s officers:

 

   

developed a list of more than 240 potential acquisition candidates;

 

   

entered into preliminary discussion with approximately 150 of those companies in the period from November 23, 2020, through January 20, 2022;

 

   

entered into non-disclosure agreements with approximately 60 target companies in the period from December 4, 2020, to January 12, 2022;

 

   

had in person, telephonic or email discussions with approximately 60 of those companies, of which approximately 30 were actively pursued (including Comera) by engaging in significant due diligence and detailed discussions directly with the senior executives and/or stockholders;

 

   

submitted indications of interest or letters of intent to 11 acquisition candidates (including Comera); and

 

   

discussed various targets at OTR’s regularly scheduled board meetings.

Of the approximately 150 potential targets with which OTR engaged in preliminary discussions, approximately 100 were eliminated prior to conducting substantive due diligence due to the potential target companies’ financial profile, growth and profitability metrics, valuation of the target company, industry trends or lack of public company readiness.

Below is a summary of the 10 acquisition candidates (other than Comera) where OTR submitted an indication of interest or a letter of intent to the acquisition candidate:

On December 2, 2020, a representative of Guggenheim Securities, LLC (“Guggenheim”) reached out to OTR to see if OTR might be interested in a potential business combination with a company that develops

 

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AI-powered LiDAR systems for vehicle autonomy and other applications. OTR entered into a non-disclosure agreement with the potential target on December 4, 2020; and on December 7, 2020, OTR’s management team held an initial videoconference with the target’s management team and representatives from Guggenheim to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence which included industry research, expert calls, and review of company materials. After several more discussions internally and with Guggenheim and the target, OTR sent target a draft letter of intent on December 17, 2020. OTR, Guggenheim, and the target proceeded to have several more discussions regarding the terms of the proposal. On January 20, 2021, Guggenheim informed OTR of the target’s decision not to proceed with OTR’s proposal due to the parties’ inability to agree upon the valuation of the target.

On January 10, 2021, a representative of Pan American Finance, LLC (“PanAm Finance”) reached out to OTR to see if OTR might be interested in a potential business combination with a company that develops biological agents for various commercial industries. PanAm Finance informed OTR that the potential target was in the early stages of exploring financing options and it likely would not pursue a transaction until late 2021 or early 2022. OTR entered into a non-disclosure agreement with the potential target on February 4, 2021; and on February 4, 2021, OTR’s management team held an initial videoconference with the target’s management team and representatives from PanAm Finance to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence, which included industry research, expert calls, and review of company materials. On November 14, 2021, a representative of Nomura Securities International, Inc (“Nomura”) reached out to OTR to inform OTR that PanAm Finance had briefed Nomura on their discussions in February 2021 and that Nomura would be kicking off a formal process with the target to explore a potential business combination transaction with a special purpose acquisition company (a “SPAC”). After several more discussions internally and with Nomura and the target, OTR sent target a draft letter of intent to the target on December 17, 2021. OTR, Nomura, and the target proceeded to have several more discussions regarding the terms of the proposal. On January 7, 2022, the target and OTR made the mutual decision not to proceed with the proposed transaction due to timing of the target’s audited financials.

In February 2021, a representative of Nomura reached out to OTR to see if OTR might be interested in a potential business combination with a company that operates in the “better-for-you” frozen foods segment. OTR entered into a non-disclosure agreement with the target on February 8, 2021; and on February 17, 2021, OTR’s management team held an initial videoconference with the potential target’s management team and representatives from Nomura to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence, which included industry research and review of company materials. After several more discussions internally and with Nomura and the target, OTR sent the target a draft letter of intent on April 20, 2021. OTR, Nomura, and the target proceeded to have several more discussions regarding the terms of the proposal. On June 15, 2021, Nomura informed OTR of the target’s intent to pursue a traditional IPO and that it would not be proceeding with OTR’s proposal.

On February 10, 2021, a representative of Farvahar Partners reached out to OTR to see if OTR might be interested in a potential business combination with a digital media company. OTR entered into a non-disclosure agreement with the potential target on February 9, 2021; and on February 10, 2021, OTR’s management team held an initial videoconference with the target’s management team and representatives from Farvahar Partners to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence, which included industry research and review of company materials. After several more discussions internally and with Farvahar Partners and the target, OTR sent target a draft letter of intent on March 22, 2021. OTR, Farvahar Partners, and the target proceeded to have several more discussions regarding the terms of the proposal. On May 26, 2021, Farvahar Partners informed OTR of the target’s intent to delay a SPAC transaction until later in the year in order to maximize shareholder value. OTR reached out to the target on July 22, 2021, but discussions regarding a potential transaction did not further materialize.

On March 2, 2021, a representative of Canaccord Genuity Group Inc. (“Canaccord”) reached out to OTR to see if OTR might be interested in a potential business combination with a company that uses advanced machine

 

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learning technology and privacy-forward solutions to deliver impactful advertising campaigns for marketers. OTR entered into a non-disclosure agreement with the potential target on March 5, 2021; and on March 18, 2021, OTR’s management team held an initial videoconference with the target’s management team and representatives from Canaccord to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence, which included industry research and review of company materials. After several more discussions internally and with Canaccord and the target, OTR sent target a draft letter of intent to the target on March 28, 2021. Shortly thereafter, Canaccord informed OTR of the target’s decision not to proceed with OTR’s proposal due to the parties’ inability to agree upon the valuation of the target.

On March 12, 2021, a representative of RBC Capital Markets (“RBC”) reached out to OTR to see if OTR might be interested in a potential business combination with a company that manufactures athletic protective equipment. OTR entered into a non-disclosure agreement with the potential target on April 16, 2021; and on March 25, 2021, OTR’s management team held an initial videoconference with the target’s management team and representatives from RBC to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence, which included industry research and review of company materials. After several more discussions internally and with RBC and the target, OTR sent target a draft letter of intent to the target on July 12, 2021. OTR, RBC, and the target proceeded to have several more discussions regarding the terms of the proposal. On August 6, 2021, RBC and OTR mutually agreed not to proceed with the proposal due to the inability to agree upon the valuation of the target.

On September 7, 2021, a representative of Mirabaud Securities Limited (“Mirabaud”) reached out to OTR to see if OTR might be interested in a potential business combination with a company that manufactures and supplies wind towers, offshore structures, and large castings in Europe. OTR entered into a non-disclosure agreement with the potential target on October 8, 2021; and on October 13, 2021, OTR’s management team held an initial videoconference with the target’s management team and representatives from Mirabaud to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence, which included industry research, expert calls, and review of company materials. After several more discussions internally and with Mirabaud and the target, OTR sent the target a draft letter of intent on October 28, 2021. OTR, Mirabaud, and the target proceeded to have several more discussions regarding the terms of the proposal. On November 3, 2021, OTR informed Mirabaud of its decision to withdraw its proposal as the two parties were unable to agree to terms around exclusivity.

On September 14, 2021, a representative of Guggenheim reached out to OTR to see if OTR might be interested in a potential business combination with a company that designs and markets small modular reactors. OTR entered into a non-disclosure agreement with the potential target on September 20, 2021; and on September 21, 2021, OTR’s management team held an initial videoconference with the target’s management team and representatives from Guggenheim to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence, which included industry research, expert calls, and review of company materials. After several more discussions internally and with Guggenheim and the target, OTR sent the target a draft letter of intent on September 28, 2021. OTR, Guggenheim, and the target proceeded to have several more discussions regarding the terms of the proposal. In November 2021, Guggenheim informed OTR of the target’s decision not to proceed with OTR’s proposal and that it would instead be partnering with a different SPAC .

On September 17, 2021, a representative of Stifel Financial Corp. (“Stifel”) reached out to OTR to see if OTR might be interested in a potential business combination with a company that provides experiential family entertainment. OTR entered into a non-disclosure agreement with the potential target on September 23, 2021; and on November 16, 2021, OTR received company materials and conducted due diligence, which included industry research, expert calls, and review of company materials. After several more discussions internally and with Stifel and the target, OTR sent the target a draft letter of intent on November 23, 2021. OTR, Stifel, and the target proceeded to have several more discussions regarding the terms of the proposal. On December 13, 2021, Stifel informed OTR of the target’s decision not to proceed with OTR’s proposal and instead decided to delay a transaction for 9 months to grow its business further.

 

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On September 23, 2021, a representative of BNP Paribas SA (“BNP”), reached out to OTR to see if OTR might be interested in a potential business combination with a company that designs and markets rapid DNA technology. OTR entered into a non-disclosure agreement with the potential target on October 26, 2021; and on October 26, 2021, OTR’s management team held an initial videoconference with the target’s management team and representatives from BNP to introduce the OTR team to the target and to learn more about the target. After the initial call, OTR conducted further due diligence, which included industry research, expert calls, and review of company materials. After several more discussions internally and with BNP and the target, OTR sent the target a draft letter of intent on November 18, 2021. OTR, BNP, and the target then proceeded to have several more discussions regarding the terms of the proposal. OTR then made the decision not to proceed with the transaction due to timing of the target’s audited financials.

The potential targets that OTR actively pursued covered a variety of industries, including: Consumer; Energy; Power and Utilities; Entertainment; Financial Technology and Specialty Finance; Green and Renewables; Industrials and Manufacturing; Infrastructure; Transportation and Logistics; Business Services; Technology and Telecommunications; Media and Advertising; and Metals and Mining. OTR’s due diligence on potential targets included review of each business’s management, stockholders, business model, valuation, balance sheet and historical and projected financials, in each case to the extent made available, among other due diligence workstreams. The decision to pursue a business combination with Comera over other potential targets included, but was not limited to, one or more of the following reasons:

 

   

a difference in valuation expectations between OTR and the senior executives or stockholders of the other potential targets, particularly in competitive processes where the potential target chose to pursue other bids;

 

   

the decision by the potential targets to pursue alternative strategic transactions or to postpone their review of strategic alternatives;

 

   

the maturity of the business of the potential target companies, the companies’ financial performance and other factors identified during OTR’s due diligence review and the presence of other potential business combination opportunities that more closely met OTR’s criteria and guidelines, including Comera;

 

   

the level of engagement by, and advanced negotiations and discussions with, Comera as compared to other potential targets where engagement was more limited and negotiations and discussions did not progress as rapidly or productively; and

 

   

OTR’s and its board’s belief, based on their preliminary evaluation and the terms of the non-binding letter of intent, that Comera was the most attractive potential business combination target that met its key criteria in a target.

OTR decided to pursue a combination with Comera because it determined that Comera represented a compelling opportunity, particularly due to the Company’s proprietary technology platform, strategic partnerships, and large addressable market. Comera also underwent a leadership transformation in 2021 and realigned its business model to focus on higher value opportunities, which we also found compelling.

In early 2021, the Chairman of OTR received an email from Charles Cherington, a stockholder of Comera, regarding his possible interest in participating in a transaction with Comera either through OTR or independent from OTR through another investment vehicle owned by him.

On May 17, 2021, Comera executed a confidentiality agreement with OTR and an entity affiliated with the Chairman of OTR, at which time Comera provided both entities with a management presentation.

On June 6, 2021, the Chairman of OTR had a telephonic meeting with the Executive Chairman of Comera to discuss his possible interest in participating in a private placement by Comera through an investment vehicle independent from OTR.

 

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On June 24, 2021, the Chairman of OTR told Comera that neither his separate entity nor OTR would participate in a transaction with Comera at that time.

On December 3, 2021, the Chairman of OTR had a telephonic meeting with Comera’s financial advisor, Maxim Group LLC (“Maxim”), on which Maxim raised the possibility of Comera as a potential acquisition candidate for OTR, noting that Comera recently had several high-quality executives join its leadership team and had also made commercial progress with its partnerships.

During the first week of December 2021, Comera began working on a draft letter of intent and term sheet for the transaction. Thereafter, throughout the month of December 2021, members of OTR’s management held internal meetings to discuss their assessment of Comera, the terms of a potential transaction and their estimates of Comera’s enterprise value, including factors such as the value of comparable companies in Comera’s industry and the strength of Comera’s growth prospects.

On December 5, 2021, the Chairman of OTR had a telephonic meeting with Charles Cherington regarding a possible transaction between OTR and Comera. Later that day, the Executive Chairman of Comera provided an overview of Comera’s team to the Chairman of OTR, and the two exchanged email correspondence to set up a meeting for December 8, 2021. Due to the COVID-19 pandemic and shelter in place orders, all meetings and calls were held by videoconference.

Following this correspondence and prior to the management meeting on December 8, 2021, OTR’s management held a meeting to discuss its current pipeline of acquisition candidates, including Comera. At this meeting, the Chairman of OTR summarized conversations regarding Comera that he had conducted in prior days.

On December 8, 2021, Comera held a meeting with representatives of OTR at which Comera gave a presentation regarding its current and planned business and its views regarding a potential business combination transaction.

On December 12, 2021, the Chairman of OTR met with Charles Cherington and David Soane, another stockholder of Comera, to discuss Comera as a potential acquisition candidate for OTR.

On December 13, 2021, representatives of Comera held a management presentation meeting with representatives of OTR. During the meeting, the parties discussed Comera’s business, the general terms of a potential transaction and certain potential competitive advantages related to Comera’s product offerings. Later that day, representatives of OTR discussed management’s favorable assessment of Comera in comparison to other acquisition candidates, the submission of an initial non-binding letter of intent and related deal terms, including valuation parameters and comparable companies, and market conditions. The parties agreed that Comera satisfied OTR’s investment criteria and guidelines and supported submitting an initial draft letter of intent to Comera.

Based on the discussions and negotiations with other potential targets, Comera emerged as a frontrunner with which to pursue a business combination.

On December 14, 2021, Comera submitted a non-binding letter of intent to OTR. The draft term sheet included with the letter of intent contemplated entering into a business combination between OTR and Comera for aggregate consideration based on a pre-money enterprise value of Comera of $177.5 million and a pre-money equity value of $185 million. The term sheet also included provisions contemplating a post-closing equity incentive plan comprised of 10% of Holdco’s fully diluted shares, a ten-member board of directors (with OTR designating one director), closing conditions, a six-month lock-up for certain Comera Stockholders that would terminate early if certain thresholds are achieved with respect to Holdco’s post-closing stock price, a to-be-specified expense cap for OTR and a mutual exclusivity provision that would restrict both OTR and Comera from soliciting or discussing any alternative transactions.

 

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On December 15, 2021, Comera provided access to a virtual data room containing additional due diligence materials for OTR’s review, including a full financial model.

On December 16, 2021 and December 17, 2021, representatives of OTR had a telephonic conference with representatives of their counsel, Greenberg, to discuss the draft letter of intent. After conducting a comparable companies valuation analysis and based on current market conditions, OTR discussed ascribing a pre-money enterprise valuation $142.5 million to Comera, which was $35 million less than the initial valuation proposed by Comera. We also discussed removing the expense cap and changing the exclusivity language to be more in line with what we had reviewed in the market.

On December 20, 2021, OTR provided comments to the letter of intent and related term sheet to Maxim. The revised version contemplated a pre-money enterprise value of $142.5 million and a pre-money equity value of $150 million (which would include all holders of options, warrants and other equity interests). The revised version also contemplated a post-closing equity incentive plan comprised of 7.5% of Holdco’s fully diluted shares, a seven-member board of directors (with OTR designating two directors), a lock-up for applicable Comera Stockholders that would be the same as that stipulated with respect to the Sponsor’s shares in OTR’s Form S-1 Registration Statement (i.e., one year with early termination if certain thresholds are achieved with respect to Holdco’s post-closing stock price), no OTR expense cap and an exclusivity provision that would restrict OTR from executing any letter of intent or definitive agr