Hennessy Capital Investment Corp. VIII (HCIC) risk factors, FY2025 10-K

Other

1. 01Risks Relating to HCIC’s Search for, Consummation of, or Inability to Consummate, a Business Combination and Post-Business Combination Risks
2. 02Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for HCIC to negotiate and complete an initial business combination
3. 03Investors’ only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of their right to redeem their shares from HCIC for cash, unless HCIC seeks shareholder approval of the initial business combination
4. 04The ability of HCIC’s public shareholders to redeem their shares for cash may make its financial condition unattractive to potential business combination targets, which may make it difficult for HCIC to enter into an initial business combination with a target
5. 05The ability of HCIC’s public shareholders to exercise redemption rights with respect to a large number of its shares may not allow HCIC to complete the most desirable business combination or optimize its capital structure
6. 06HCIC has until the date that is 24 months from the closing of its initial public offering, or until such earlier liquidation date as its board of directors may approve, to consummate its initial business combination
7. 07If a shareholder fails to receive notice of HCIC’s offer to redeem HCIC’s public shares in connection with the initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed
8. 08If HCIC does not consummate an initial business combination within 24 months from the closing of its initial public offering, HCIC’s public shareholders may be forced to wait beyond such time before redemption from HCIC’s trust account
9. 09Investors will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate their investment, therefore, shareholders may be forced to sell their public shares or share rights, potentially at a loss
10. 10Investors will not be entitled to protections normally afforded to investors of many other SPACs
11. 11If third parties bring claims against HCIC, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.00 per share
12. 12HCIC’s directors may decide not to enforce the indemnification obligations of its sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to HCIC’s public shareholders
13. 13HCIC may not have sufficient funds to satisfy indemnification claims of its directors and executive officers
14. 14HCIC’s shareholders may be held liable for claims by third parties against HCIC to the extent of distributions received by them upon redemption of their shares
15. 15HCIC may not hold an annual general meeting until after the consummation of its initial business combination, which could delay the opportunity for HCIC’s shareholders to elect directors
16. 16After HCIC’s initial business combination, it is possible that a majority of HCIC’s directors and officers will live outside the United States and all of HCIC’s assets will be located outside the United States; therefore investors may not be able to enforce federal securities laws or their other legal rights
17. 17HCIC may seek business combination opportunities in industries or sectors which may or may not be outside of its management’s area of expertise
18. 18HCIC may seek business combination opportunities with a high degree of complexity that require significant operational improvements, which could delay or prevent it from achieving its desired results
19. 19HCIC may seek business combination opportunities with an early-stage financially unstable business or an entity lacking an established record of revenue, cash flow or earnings, which could subject it to volatile revenues, cash flows or earnings or difficulty in retaining key personnel
20. 20Because HCIC is not limited to any particular business or specific geographic location or any specific target businesses with which to pursue its initial business combination, shareholders will be unable to ascertain the merits or risks of any particular target business’ operations
21. 21HCIC is not required to obtain a fairness opinion and consequently, shareholders may have no assurance from an independent source that the price HCIC is paying for the business is fair to the company from a financial point of view
22. 22Transactions in connection with or in anticipation of HCIC’s initial business combination and its structure thereafter may not be tax-efficient to its shareholders and share right holders. As a result of HCIC’s business combination, its tax obligations may be more complex, burdensome and uncertain
23. 23Because HCIC must furnish its shareholders with target business financial statements, it may lose the ability to complete an otherwise advantageous initial business combination with some prospective target businesses
24. 24Compliance obligations under the Sarbanes-Oxley Act may make it more difficult for HCIC to effectuate its initial business combination, require substantial financial and management resources, and increase the time and costs of completing an initial business combination
25. 25HCIC does not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for HCIC to complete an initial business combination with which a substantial majority of its shareholders do not agree
26. 26Certain agreements related to HCIC’s initial public offering may be amended or waived without shareholder approval
27. 27HCIC may be unable to obtain additional financing to complete its initial business combination or to fund the operations and growth of a target business, which could compel HCIC to restructure or abandon a particular business combination
28. 28HCIC’s initial shareholders may exert a substantial influence on actions requiring a shareholder vote, potentially in a manner that shareholders do not support
29. 29A 1% U.S. federal excise tax on stock buybacks could be imposed on redemptions of HCIC’s shares if it were to become a “covered corporation” in the future
30. 30HCIC may issue notes or other debt securities, or otherwise incur substantial debt, to complete an initial business combination, which may adversely affect its leverage and financial condition and thus negatively impact the value of its shareholders’ investment
31. 31HCIC may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder its ability to complete its initial business combination and give rise to increased costs and risks that could negatively impact its operations and profitability
32. 32HCIC may attempt to complete its initial business combination with a private company about which little information is available, which may result in an initial business combination with a company that is not as profitable as it suspected, if at all
33. 33Changes in international trade policies, tariffs and treaties affecting imports and exports may have a material adverse effect on HCIC’s search for an initial business combination target or the performance or business prospects of a post-business combination company
34. 34Recent increases in inflation in the United States and elsewhere could make it more difficult for HCIC to complete its initial business combination

Risks Relating to HCIC’s Sponsor and Management Team

1. 35The nominal purchase price paid by HCIC’s sponsor for the founder shares may result in significant dilution to the implied value of public shares upon the consummation of HCIC’s initial business combination
2. 36The value of the founder shares following completion of HCIC’s initial business combination is likely to be substantially higher than the nominal price paid for them, even if the trading price of HCIC’s ordinary shares at such time is substantially less than $10.00 per share
3. 37HCIC is dependent upon its executive officers and directors and their departure, or a reduction in the amount of time they can dedicate to HCIC’s initial business combination, could adversely affect HCIC’s ability to operate
4. 38Since HCIC’s sponsor, officers and directors will lose their entire investment in HCIC if its initial business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for HCIC’s initial business combination
5. 39HCIC’s officers and directors will allocate some of their time to other businesses, thereby causing conflicts of interest in their determination as to how much time to devote to HCIC’s affairs. This conflict of interest could have a negative impact on HCIC’s ability to complete its initial business combination
6. 40HCIC’s officers and directors also may become aware of business opportunities which may be appropriate for presentation to HCIC and the other entities to which they owe certain fiduciary or contractual duties
7. 41HCIC’s officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with its interests
8. 42HCIC may engage in an initial business combination with one or more target businesses that have relationships with entities that may be affiliated with members of its management team, its sponsor or existing holders, which may raise potential conflicts of interest
9. 43HCIC’s management may not be able to maintain control of a target business after its initial business combination
10. 44Members of HCIC’s management team and companies affiliated thereof have been, and may from time to time be, involved in legal proceedings or governmental investigations unrelated to HCIC’s business

Risks Relating to HCIC’s Securities

1. 45The securities in which HCIC invests the funds held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the per-share redemption amount received by public shareholders may be less than $10.00 per share
2. 46If HCIC is deemed to be an investment company under the Investment Company Act, it may be required to institute burdensome compliance requirements and its activities may be restricted, which may make it difficult for HCIC to complete its initial business combination
3. 47If HCIC’s circumstances change over time, HCIC will update its disclosure to reflect how such changes impact the risk that it may be considered to be operating as an unregistered investment company
4. 48Nasdaq may delist HCIC’s securities from trading on its exchange, which could limit investors’ ability to make transactions in HCIC’s securities and subject HCIC to additional trading restrictions
5. 49Additionally, HCIC’s units and share rights will not be traded after completion of its initial business combination
6. 50The grant of registration rights to HCIC’s initial shareholders may make it more difficult to complete its initial business combination, and the future exercise of such rights may adversely affect the market price of HCIC’s Class A ordinary shares
7. 51Unlike many other similarly structured SPACs, HCIC’s initial shareholders will receive additional Class A ordinary shares if HCIC issues shares to consummate an initial business combination
8. 52Because each unit contains one right to receive one-twelfth (1/12) of one Class A ordinary share upon the consummation of HCIC’s initial business combination, and only whole shares will be issued in exchange for share rights, the units may be worth less than units of other SPACs
9. 53A market for HCIC’s securities may not develop, which would adversely affect the liquidity and price of HCIC’s securities
10. 54Redeeming shareholders may be unable to sell their securities when they wish to in the event that the proposed business combination is not approved
11. 55Provisions in HCIC’s amended and restated memorandum and articles of association may inhibit a takeover of HCIC, which could limit the price investors might be willing to pay in the future for HCIC’s Class A ordinary shares and could entrench management
12. 56HCIC is subject to changing law and regulations regarding regulatory matters, corporate governance and public disclosure that have increased both its costs and the risk of non-compliance
13. 57HCIC is a newly incorporated company with no operating history and no revenues, and investors have no basis on which to evaluate its ability to achieve its business objective
14. 58Past performance by HCIC’s management team and their respective affiliates may not be indicative of future performance of an investment in HCIC
15. 59HCIC may reincorporate in another jurisdiction in connection with its initial business combination and such reincorporation may result in taxes imposed on shareholders or share right holders
16. 60HCIC may reincorporate in or transfer by way of continuation to another jurisdiction in connection with its initial business combination, and the laws of such jurisdiction may govern some or all of its future material agreements, and it may not be able to enforce its legal rights
17. 61An investment in HCIC’s securities may result in uncertain U.S. federal income tax consequences
18. 62Cyber incidents or attacks directed at HCIC could result in information theft, data corruption, operational disruption and/or financial loss
19. 63Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect HCIC’s business, including its ability to negotiate and complete its initial business combination and results of operations
20. 64Because HCIC is incorporated under the laws of the Cayman Islands, shareholders may face difficulties in protecting their interests, and shareholders’ ability to protect their rights through the U.S. federal courts may be limited
21. 65Holders of Class A ordinary shares will not be entitled to vote on any appointment or removal of directors and to continue HCIC in a jurisdiction outside the Cayman Islands prior to HCIC’s initial business combination