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As filed with the Securities and Exchange Commission on June 8, 2022
Registration No. 333-259743
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 5
to
Form F-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
TH International Limited
(Exact name of registrant as specified in its charter)
Cayman Islands
5812
Not Applicable
(State or other jurisdiction of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification No.)
2501 Central Plaza
227 Huangpi North Road
Shanghai, People’s Republic of China, 200003
+86-021-6136-6616
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Cogency Global Inc.
122 East 42nd Street, 18th Floor
New York, NY 10168
+1(800) 221-0102
(Name, address, including zip code, and telephone number, including area code, of agent for service)
With copies to:
Daniel Dusek
Joseph Raymond Casey
Ram Narayan
Kirkland & Ellis International LLP
26th Floor, Gloucester Tower
The Landmark
15 Queen’s Road Central
Hong Kong
Tel: +852-3761-3300
Steve Lin
Kirkland & Ellis International LLP
29th Floor, China World Office 2
No.1 Jian Guo Men Wai Avenue
Beijing 100004, P.R. China
Tel: +86 10-5737-9300
John Owen
Omar Pringle
Morrison & Foerster LLP
250 W. 55th Street
New York, NY 10019
Tel: +1-212-468-8036
Marcia Ellis
Ruomu Li
Morrison & Foerster LLP
33th Floor, Edinburgh Tower
The Landmark
15 Queen’s Road Central
Hong Kong, China
Tel: +852-2585-0888
Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after the effective date of this registration statement and on completion of the business combination described in the enclosed proxy statement/prospectus.
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. ☐
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) ☐
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
Emerging growth company ☒
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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. †☐
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

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The information in this proxy statement/prospectus is not complete and may be changed. The registrant may not issue these securities until the registration statement filed with the Securities and Exchange Commission is effective. The proxy statement/prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted.
PRELIMINARY, SUBJECT TO COMPLETION, DATED JUNE 8, 2022
PROXY STATEMENT FOR EXTRAORDINARY GENERAL MEETING OF SHAREHOLDERS OF
SILVER CREST ACQUISITION CORPORATION
PROSPECTUS FOR UP TO
43,125,000 ORDINARY SHARES,
26,150,000 WARRANTS AND
26,150,000 ORDINARY SHARES UNDERLYING WARRANTS OF
TH INTERNATIONAL LIMITED
The board of directors of Silver Crest Acquisition Corporation, a Cayman Islands exempted company (“Silver Crest”), has unanimously approved the Agreement and Plan of Merger (“Original Merger Agreement”), dated as of August 13, 2021, by and among Silver Crest, TH International Limited, a Cayman Islands exempted company (“THIL”), and Miami Swan Ltd, a Cayman Islands exempted company and a wholly-owned subsidiary of THIL (“Merger Sub”), as amended by Amendment No. 1 to the Agreement and Plan of Merger, dated as of January 30, 2022 (“Amendment No. 1 to the Merger Agreement”) and Amendment No. 2 to the Agreement and Plan of Merger, dated March 9, 2022 ( “Amendment No. 2 to the Merger Agreement”), in each case by and among Silver Crest, THIL and Merger Sub. The Original Merger Agreement as so amended and as may be further amended from time to time is referred to as the “Merger Agreement.” Pursuant to the Merger Agreement, Merger Sub will merge with and into Silver Crest (such merger, the “First Merger”), with Silver Crest surviving the First Merger as a wholly owned subsidiary of THIL (Silver Crest as the surviving entity of the First Merger, the “Surviving Entity”). Immediately following the consummation of the First Merger and as part of the same overall transaction, the Surviving Entity will merge with and into THIL (such merger, the “Second Merger” and together with the First Merger, the “Mergers”), with THIL surviving the Second Merger (such transactions, collectively, the “Business Combination”). As a result of the Business Combination, and upon consummation of the Business Combination and the other transactions contemplated by the Merger Agreement (such transactions, collectively, the “Transactions”), the shareholders of Silver Crest will become shareholders of THIL.
Pursuant to the Merger Agreement, (i) immediately prior to the effective time of the First Merger (the “First Effective Time”), each Class B ordinary share of Silver Crest, par value $0.0001 per share (“Silver Crest Class B Shares”), outstanding immediately prior to the First Effective Time will be automatically converted into one Class A ordinary share of Silver Crest, par value $0.0001 per share (“Silver Crest Class A Shares” and together with the Silver Crest Class B Shares, the “Silver Crest Ordinary Shares”) and, after giving effect to such automatic conversion, at the First Effective Time and as a result of the First Merger, each Silver Crest Class A Share outstanding immediately prior to the First Effective Time will automatically be converted into the right of the holder thereof to receive one ordinary share of THIL, with a par value per share to be calculated pursuant to the methodology set forth in the Merger Agreement (“THIL Ordinary Shares”), after giving effect to the Share Split (as defined below), and (ii) each issued and outstanding warrant to purchase Silver Crest Class A Shares (“Silver Crest Warrants”) will be assumed by THIL and converted into a corresponding warrant to purchase THIL Ordinary Shares (“THIL Warrants”). Immediately prior to the First Effective Time, the Silver Crest Class A Shares and the public Silver Crest Warrants comprising each issued and outstanding Silver Crest Unit (as defined below), consisting of one Silver Crest Class A Share and one-half of one public Silver Crest Warrant, will be automatically separated and the holder thereof will be deemed to hold one Silver Crest Class A Share and one-half of one public Silver Crest Warrant. Accordingly, there will be no THIL units nor any Nasdaq listing of THIL units following the consummation of the Business Combination. No fractional public Silver Crest Warrants will be issued in connection with such separation such that if a holder of such Silver Crest Units would be entitled to receive a fractional public Silver Crest Warrant upon such separation, the number of public Silver Crest Warrants to be issued to such holder upon such separation will be rounded down to the nearest whole number of public Silver Crest Warrants and no cash will be paid in lieu of such fractional public Silver Crest Warrants.
Immediately prior to the First Effective Time, THIL will effect a share split of each THIL Ordinary Share into such number of THIL Ordinary Shares, calculated in accordance with the terms of the Merger
Agreement, such that each THIL Ordinary Share will have a deemed value of $10.00 per share on a fully diluted basis, based on THIL’s implied valuation immediately prior to the consummation of the Business Combination, after giving effect to such share split (the “Share Split”). Unless otherwise indicated, this proxy statement/prospectus does not reflect the Share Split.
Proposals to approve the Merger Agreement and the other matters discussed in this proxy statement/prospectus will be presented at the extraordinary general meeting of Silver Crest shareholders scheduled to
be held on           , 2022 at           and in virtual format.
Silver Crest’s securities, namely the Units (as defined below) (trading symbol “SLCRU”), Silver Crest Class A Shares (trading symbol “SLCR”) and Public Warrants (as defined below) (trading symbol
“SLCRW”), are currently listed on Nasdaq. The Units, Silver Crest Class A Shares and Public Warrants will cease trading upon consummation of the Business Combination and will be delisted from Nasdaq and deregistered under the Exchange Act.
Although THIL is not currently a public reporting company, following the effectiveness of the registration statement of which this proxy statement/prospectus is a part and the closing of the Business Combination
(the “Closing”), THIL will become subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). THIL intends to apply for listing of THIL Ordinary Shares on the Nasdaq Stock Market (“Nasdaq”) under the proposed symbol “THCH” and listing of THIL Warrants on Nasdaq under the proposed symbol “THCHW” to be effective at the consummation of the Business Combination. It is a condition of the consummation of the Transactions that THIL Ordinary Shares and THIL Warrants are approved for listing on Nasdaq (subject only to official notice of issuance thereof). While trading on Nasdaq is expected to begin on the first business day following the date of completion of the Business Combination, there can be no assurance that THIL Ordinary Shares and THIL Warrants will be listed on Nasdaq or that a viable and active trading market will develop. See “Risk Factors — Risks Related to THIL’s Securities” for more information.
THIL is an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, and is therefore eligible to take advantage of certain reduced reporting requirements otherwise applicable to
other public companies.
THIL is also a “foreign private issuer” as defined in the Exchange Act, and will be exempt from certain rules under the Exchange Act that impose certain disclosure obligations and procedural requirements for proxy solicitations under Section 14 of the Exchange Act. In addition, THIL’s officers, directors and principal shareholders will be exempt from the reporting and “short-swing” profit recovery provisions under Section 16 of the Exchange Act. Moreover, THIL will not be required to file periodic reports and financial statements with the Securities and Exchange Commission as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act.
THIL is a Cayman Islands holding company that conducts its operations in mainland China through wholly owned subsidiaries. THIL is not a Chinese operating company and does not directly own any substantive
business operations in mainland China. The securities registered herein are securities of THIL, not those of its operating companies. Therefore, investors in THIL will not directly hold any equity interests in its operating companies. This holding company structure involves unique risks to investors. For example, PRC regulatory authorities could disallow this operating structure and limit or hinder THIL’s ability to conduct its business through, receive dividends from or transfer funds to the operating companies or list on a U.S. or other foreign exchange, which could cause the value of THIL’s securities to significantly decline or become worthless. In addition, THIL and its subsidiaries incorporated under the laws of the People’s Republic of China (the “PRC Subsidiaries”) face various legal and operational risks associated with doing business in China. For a detailed description of the risks related to THIL’s holding company structure and doing business in China, see “Risk Factors — Risks Related to Doing Business in China.” These risks arise from, among other things, PRC governmental authorities’ significant oversight and discretion over the business and financing activities of its PRC Subsidiaries, the complex and evolving PRC legal system, frequent changes in laws, regulations and government policies, uncertainties and inconsistencies regarding the interpretation and enforcement of laws and regulations, difficulties or delays in obtaining regulatory approvals for listing on a foreign stock exchange or conducting certain business activities and increasing oversight on cybersecurity and data privacy and potential anti-monopoly actions related to the PRC government’s recently issued statements and instituted regulatory actions. These risks could result in a material change in the post-combination operations of THIL’s PRC Subsidiaries and significantly limit or completely hinder THIL’s ability to list on a U.S. or other foreign stock exchange, to accept foreign investments and to offer or continue to offer securities to foreign investors. THIL and its PRC Subsidiaries are also subject to various restrictions on intercompany fund transfers and foreign exchange control under current PRC laws and regulations and could be subject to additional, more onerous restrictions under new PRC laws and regulations that may come into effect in the future. For example, THIL’s PRC Subsidiaries may pay dividends only out of their accumulated after-tax profits upon satisfaction of relevant statutory conditions and procedures, if any, determined in accordance with PRC accounting standards and regulations; each of the PRC Subsidiaries is required to set aside at least 10% of its after-tax profits each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of its registered capital; the PRC Subsidiaries are required to complete certain procedural requirements related to foreign exchange control in order to make dividend payments in foreign currencies; a withholding tax, at the rate of 10% or lower, is payable by the PRC Subsidiaries upon dividend remittance; approval from or registration with competent PRC government authorities is required where Renminbi is to be converted into foreign currency and remitted out of mainland China to pay capital expenses, such as the repayment of loans denominated in foreign currencies; loans by THIL to its PRC Subsidiaries to finance their operations shall not exceed certain statutory limits and must be registered with the local counterpart of the State Administration of Foreign Exchange (the “SAFE”); and any capital contribution from THIL to its PRC Subsidiaries is required to be registered with the competent PRC government authorities. Due to potential interventions in or the imposition of restrictions and limitations by the PRC government on the ability of THIL or its PRC Subsidiaries to transfer cash and/or non-cash assets based on existing or new PRC laws and regulations, cash and/or non-cash assets located in mainland China or held by THIL’s PRC Subsidiaries, such as Tim Hortons (China) Holdings Co., Ltd. (“Tim Hortons China”) and Tim Hortons (Shanghai) Food and Beverage Co., Ltd., may not be available to fund THIL’s foreign currency needs or any foreign operations that THIL may have in the future or for other uses outside of mainland China, and THIL may not be able to effectively utilize the proceeds from the Business Combination and related financings to fund the operations or liquidity needs of its PRC Subsidiaries. For a detailed description of the restrictions and related risks, see “Summary — The Parties to the Business Combination — TH International — Corporate Structure,” “Risk Factors — Risks Related to Doing Business in China — Restrictions on our subsidiaries on paying dividends or making other payments to us under existing or new laws and regulations of the PRC and the HKSAR may restrict our ability to satisfy our liquidity requirements” and “Risk Factors — Risks Related to Doing Business in China — Foreign exchange controls may limit our ability to effectively utilize our revenues and the proceeds from the Business Combination and related financings and adversely affect the value of your investment.” Based on the experience of its management team, THIL does not believe that remittance of cash and/or non-cash assets from Hong Kong, including cash and/or non-cash assets held by TH Hong Kong International Limited (“THHK”), a wholly-owned subsidiary of THIL incorporated under the laws of the Hong Kong Special Administrative Region (the “HKSAR”), is subject to the aforementioned interventions, restrictions and limitations by the PRC government or similar interventions, restrictions or limitations from the government of the HKSAR, nor does THIL believe such interventions, restrictions and limitations will be imposed on THHK or any future Hong Kong subsidiary that THIL may have in the foreseeable future. To the extent that THIL’s cash and/or non-cash assets in Hong Kong or any cash and/or non-cash assets held by its Hong Kong Subsidiaries are subject to the aforementioned interventions, restrictions and limitations by the PRC government or the government of the HKSAR, then, as a result of such interventions, restrictions and limitations, such cash/assets may not be available to pay dividends to THIL, to fund the operations of THIL’s subsidiaries outside Hong Kong or to be used outside of Hong Kong for other purposes. As of the date of this proxy statement/prospectus, neither THIL nor any of its subsidiaries have made any dividends or distributions to their parent companies or any investor, and there has been no transfer of capital expenses among THIL and its subsidiaries. As of the date of this proxy statement/prospectus, THIL has transferred an aggregate of US$180.0 million in cash to THHK as capital injections and shareholder loans, and THHK has transferred an aggregate of US$134.0 million in cash to Tim Hortons China, a wholly-owned PRC subsidiary of THHK, and US$25.0 million in cash to Tim Hortons (Shanghai) Food and Beverage Co., Ltd., a wholly-owned PRC subsidiary of Tim Hortons China, as capital injections. THIL currently does not have a specific timetable on when to settle the amounts owed within the company and plans to distribute cash dividends after it becomes profitable. See page F-11 of THIL’s audited historical consolidated financial statements included elsewhere in this proxy statement/prospectus for additional information on the amount of cash balances held at financial institutions in mainland China, Hong Kong and the Cayman Islands as of December 31, 2020 and 2021. Any determination to pay dividends in the future will be at the discretion of THIL’s board of directors. THIL does not currently have any cash management policy that dictates how funds shall be transferred between THIL and its subsidiaries, including its PRC Subsidiaries, THHK and any other non-PRC subsidiaries that it may have in the future, or among its subsidiaries. In addition, on December 16, 2021, the Public Company Accounting Oversight Board (the “PCAOB”) issued a report on its determination that it is unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong because of positions taken by local authorities. THIL’s auditors, who are headquartered in mainland China, are subject to the determinations announced by the PCAOB. As a result, the PCAOB has been and currently is unable to inspect THIL’s auditors. On December 2, 2021, the SEC adopted final amendments implementing the disclosure and submission requirements under the Holding Foreign Companies Accountable Act (the “HFCAA”), pursuant to which the SEC will (i) identify an issuer as a “Commission-Identified Issuer” if the issuer has filed an annual report containing an audit report issued by a registered public accounting firm that the PCAOB has determined it is unable to inspect or investigate completely because of the position taken by the authority in the foreign jurisdiction and (ii) impose a trading prohibition on the issuer after it is identified as a Commission-Identified Issuer for three consecutive years. The Accelerating Holding Foreign Companies Accountable Act, which was passed by the U.S. Senate in June 2021, (the “AHFCAA”), if enacted, would shorten the three-consecutive-year compliance period under the HFCAA to two consecutive years and, as a result, reduce the time before the potential trading prohibition against or delisting of THIL’s securities. The fact that the PCAOB has been and currently is unable to inspect THIL’s auditors could deprive investors of the benefits of such inspections and cause THIL’s securities to be delisted under the HFCAA and the AHFCAA. The delisting of THIL’s securities, or the threat of such securities being delisted, may materially and adversely affect the value of your investment. For a detailed description of the related risks, see “Risk Factors — Risks Related to Doing Business in China — The PCAOB has been and currently is unable to inspect our auditor. Our securities may be delisted under the HFCAA if the PCAOB is unable to inspect our auditors for three consecutive years after we are identified by the SEC as a Commission-Identified Issuer, or two consecutive years if the AHFCAA is enacted. The delisting of our securities, or the threat of our securities being delisted, may materially and adversely affect the value of your investment. Additionally, the inability of the PCAOB to conduct inspections deprives investors of the benefits of such inspections.
Assuming that none of the holders of Silver Crest Class A Shares (the “Silver Crest Public Shareholders”) demand redemption and there are no Dissenting Silver Crest Shareholders (as defined below) (the “No
Redemptions Scenario”) and the PIPE Investment (as defined below) is fully funded at the Closing and excluding (i) shares reserved for THIL’s granted share options and restricted share units subject to vesting, (ii) shares subject to certain earn-out provisions (the “Earn-out Shares”), (iii) shares issuable at THIL’s discretion upon the Closing under an Equity Support Agreement (the “Equity Support Shares”), the maximum amount of which depends on the level of redemptions and the actual size of the PIPE Investment, and shares issuable after the Closing under a committed equity facility, the amount of which either depends on the fair market value of our shares or is to be determined at our discretion and (iv) shares underlying the warrants issued in Silver Crest’s initial public offering and THIL’s outstanding convertible notes, it is anticipated that, immediately after the Closing, the existing shareholders of THIL will own approximately 74.67% of the outstanding THIL Ordinary Shares (and Peter Yu, our Chairman and the Managing Partner of Cartesian Capital Group, LLC (“Cartesian”), will indirectly own approximately 43.55% of the outstanding THIL Ordinary Shares through Pangaea Two Acquisition Holdings XXIIA Limited, an existing shareholder of THIL that is controlled by him, and another affiliate of Cartesian that is participating in the PIPE Investment), Silver Crest Public Shareholders will own approximately 20.10% of the outstanding THIL Ordinary Shares, and Silver Crest Management LLC (the “Sponsor”) will own approximately 2.80% of the outstanding THIL Ordinary Shares. Assuming maximum redemption by Silver Crest Public Shareholders and excluding shares reserved for THIL’s granted share options and restricted share units subject to vesting (the “Maximum Redemptions Scenario”), it is anticipated that, immediately after the Closing, the existing shareholders of THIL will own approximately 90.97% of the outstanding THIL Ordinary Shares (and Mr. Yu will indirectly own approximately 53.05% of the outstanding THIL Ordinary Shares), Silver Crest Public Shareholders will own approximately 2.84% of the outstanding THIL Ordinary Shares, and the Sponsor will own approximately 3.42% of the outstanding THIL Ordinary Shares. In addition, under the same assumptions, Mr. Yu is anticipated to own over 50% of the equity interest and voting power of the combined company immediately following the Closing if Silver Crest Public Shareholders holding 22,135,130 or more Silver Crest Class A Shares decide to exercise their redemption rights, which would give Peter Yu the ability to control the outcome of matters submitted to shareholders for approval, including the appointment or removal of directors (subject to the certain limitations described elsewhere in this registration statement/proxy statement). As a result, the combined company may qualify as a “controlled company” within the meaning of Nasdaq’s corporate governance standards and will have the option not to comply with certain requirements to which companies that are not controlled companies are subject, including the requirement that a majority of its board of directors shall consist of independent directors and the requirement that its nominating and corporate governance committee and compensation committee shall be composed entirely of independent directors. In the event that the combined company qualifies as a “controlled company,” THIL does not intend to take advantage of these exemptions. However, THIL cannot guarantee that this may not change going forward. In addition, it is expected that four out of the nine members of THIL’s board of directors after the Closing, including Peter Yu, will be executives of Cartesian.
The accompanying proxy statement/prospectus provides Silver Crest shareholders with detailed information about the Business Combination and other matters to be considered at the extraordinary general meeting
of Silver Crest. We encourage you to read the entire accompanying proxy statement/prospectus, including the Annexes and other documents referred to therein, carefully and in their entirety. You should also carefully consider the risk factors described in “Risk Factors” beginning on page 36 of the accompanying proxy statement/prospectus.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued in connection with the Business Combination, or determined if this
proxy statement/prospectus is accurate or adequate. Any representation to the contrary is a criminal offense.
This proxy statement/prospectus is dated           , 2022, and is first being mailed to Silver Crest shareholders on or about           , 2022.

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REFERENCES TO ADDITIONAL INFORMATION
This proxy statement/prospectus incorporates important business and financial information about THIL and Silver Crest that is not included in or delivered with this proxy statement/prospectus. This information is available to you without charge upon written or oral request. If you would like to receive any of the additional information, please contact:
Silver Crest Acquisition Corporation
Suite 3501, 35/F, Jardine House,
1 Connaught Place, Central, Hong Kong
Telephone: +852-2165-9000
To obtain timely delivery of the documents, you must request them no later than five business days before the date of the extraordinary general meeting, or no later than                 , 2022.
For additional information, see “Where You Can Find More Information” on page 242.
 

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Notice of Extraordinary General Meeting of Shareholders
of Silver Crest Acquisition Corporation
To Be Held on                 , 2022
TO THE SHAREHOLDERS OF SILVER CREST ACQUISITION CORPORATION:
NOTICE IS HEREBY GIVEN that an extraordinary general meeting of shareholders of Silver Crest Acquisition Corporation (“Silver Crest”), a Cayman Islands exempted company, will be held at                 a.m. Eastern Time, on                 , 2022 at                 and virtually over the Internet by means of a live audio webcast at https://                 (the “extraordinary general meeting”). Due to health concerns stemming from                the COVID-19 pandemic, and to support the health and well-being of our shareholders, we encourage shareholders to attend the extraordinary general meeting virtually via the live webcast. You are cordially invited to attend and participate in the extraordinary general meeting online by visiting
https://                 . The extraordinary general meeting will be held for the following purposes:
1.
Proposal No. 1 — The Business Combination Proposal — to consider and vote upon, as an ordinary resolution, a proposal to approve and authorize the Agreement and Plan of Merger, dated as of August 13, 2021, by and among Silver Crest, TH International Limited, a Cayman Islands exempted company (“THIL”), and Miami Swan Ltd, a Cayman Islands exempted company and a wholly-owned subsidiary of THIL (“Merger Sub”) (such agreement as amended by Amendment No. 1 to the Agreement and Plan of Merger, dated as of January 30, 2022 (the “Amendment No. 1 to the Merger Agreement”) and Amendment No. 2 to the Agreement and Plan of Merger, dated March 9, 2022, in each case by and among Silver Crest, THIL and Merger Sub, and as may be further amended from time to time, the “Merger Agreement”), a copy of which is attached to this proxy statement/prospectus as Annex A, and the transactions contemplated therein, including the business combination whereby Merger Sub will merge with and into Silver Crest (the “First Merger”), with Silver Crest surviving the First Merger as a wholly owned subsidiary of THIL, and immediately thereafter and as part of the same overall transaction, Silver Crest (as the surviving entity of the First Merger) will merge with and into THIL, with THIL surviving the merger (the “Business Combination Proposal”);
2.
Proposal No. 2 — The Merger Proposal — to consider and vote upon, as a special resolution, a proposal to approve and authorize the First Merger and the Plan of Merger by and among Silver Crest, Merger Sub and THIL, substantially in the form attached to this proxy statement/prospectus as Annex C (the “Merger Proposal”); and
3.
Proposal No. 3 — The Adjournment Proposal — to consider and vote upon, as an ordinary resolution, a proposal to adjourn the extraordinary general meeting to a later date or dates to be determined by the chairman of the extraordinary general meeting, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the extraordinary general meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote (the “Adjournment Proposal”).
We also will transact any other business as may properly come before the extraordinary general meeting or any adjournment or postponement thereof.
The full text of the resolutions to be voted on at the extraordinary general meeting is as follows:
Resolution No. 1 — The Business Combination Proposal
RESOLVED, as an ordinary resolution, that Silver Crest’s entry into the Agreement and Plan of Merger, dated as of August 13, 2021, by and among Silver Crest Acquisition Corporation (“Silver Crest”), TH International Limited (“THIL”) and Miami Swan Ltd (“Merger Sub”) (as amended by Amendment No. 1 to the Agreement and Plan of Merger, dated as of January 30, 2022 and Amendment No. 2 to the Agreement and Plan of Merger, dated March 9, 2022, in each case by and among Silver Crest, THIL and Merger Sub, and as may be further amended from time to time, the “Merger Agreement”), a copy of which is attached to the accompanying proxy statement/prospectus as Annex A, pursuant to which, among other things, Merger Sub will merge with and into Silver Crest, with Silver Crest surviving the merger, and immediately
 

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thereafter and as part of the same overall transaction, Silver Crest will merge with and into THIL, with THIL surviving the merger, in accordance with the terms and subject to the conditions of the Merger Agreement, and the transactions contemplated by the Merger Agreement be and are hereby authorized, approved, ratified and confirmed in all respects.”
Resolution No. 2 — The Merger Proposal
RESOLVED, as a special resolution, that the Plan of Merger, by and among Silver Crest Acquisition Corporation (“Silver Crest”), Miami Swan Ltd (“Merger Sub”) and TH International Limited (“THIL”), substantially in the form attached to the accompanying proxy statement/prospectus as Annex C (the “Plan of Merger”), and the merger of Merger Sub with and into Silver Crest with Silver Crest surviving the merger as a wholly owned subsidiary of THIL be and are hereby authorized, approved and confirmed in all respects and that Silver Crest be and is hereby authorized to enter into the Plan of Merger.”
Resolution No. 3 — The Adjournment Proposal
RESOLVED, as an ordinary resolution, that the adjournment of the extraordinary general meeting to a later date or dates to be determined by the chairman of the extraordinary general meeting, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more proposals at the extraordinary general meeting, be and is hereby approved.”
The items of business listed above are more fully described elsewhere in the proxy statement/prospectus. Whether or not you intend to attend the extraordinary general meeting, we urge you to read the proxy statement/prospectus in its entirety, including the annexes and accompanying financial statements, before voting. IN PARTICULAR, WE URGE YOU TO CAREFULLY READ THE SECTION IN THE PROXY STATEMENT/PROSPECTUS ENTITLED “RISK FACTORS.”
Only holders of record of Silver Crest Ordinary Shares at the close of business on June 6, 2022 (the “record date”) are entitled to notice of the extraordinary general meeting and to vote and have their votes counted at the extraordinary general meeting and any adjournments or postponements of the extraordinary general meeting.
After careful consideration, Silver Crest’s board of directors has determined that each of the proposals listed is fair to and in the best interests of Silver Crest and its shareholders and unanimously recommends that you vote or give instruction to vote “FOR” each of the proposals set forth above. When you consider the recommendations of Silver Crest’s board of directors, you should keep in mind that Silver Crest’s directors and officers may have interests in the Business Combination that conflict with, or are different from, your interests as a shareholder of Silver Crest. See the section in the proxy statement/prospectus entitled “Proposal One—The Business Combination Proposal—Interests of Certain Persons in the Business Combination.”
The closing of the Business Combination is conditioned on approval of the Business Combination Proposal and the Merger Proposal. If either of these proposals is not approved and the applicable closing condition in the Merger Agreement is not waived, then Silver Crest will not consummate the Business Combination. The Adjournment Proposal is not conditioned on the approval of any other proposal listed above.
All Silver Crest shareholders at the close of business on the record date are cordially invited to attend the extraordinary general meeting, which will be held at                 and virtually over the Internet by means of a live audio webcast at https://                 . To ensure your representation at the extraordinary general meeting, however, you are urged to complete, sign, date and return the enclosed proxy card as soon as possible in the postage-paid return envelope provided and, in any event so as to be received by Silver Crest no later than at                 a.m. Eastern Time, on                 , 2022, being 48 hours before the time appointed for the holding of the extraordinary general meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting). In the case of joint shareholders, where more than one of the joint shareholder purports to appoint a proxy, only the appointment submitted by the most senior holder (being the first named holder in respect of the shares in Silver Crest’s register of members) will be accepted. If you are a holder of record of Silver
 

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Crest Ordinary Shares at the close of business on the record date, you may also cast your vote at the extraordinary general meeting. If you hold your Silver Crest Ordinary Shares in “street name,” which means your shares are held of record by a broker, bank or nominee, you must instruct your broker or bank on how to vote the shares you beneficially own or, if you wish to attend and vote at the extraordinary general meeting, you must obtain a legal proxy from the shareholder of record and e-mail a copy (a legible photograph is sufficient) of your proxy to proxy@continentalstock.com no later than 72 hours prior to the extraordinary general meeting. Holders should contact their broker, bank or nominee for instructions regarding obtaining a legal proxy. Holders who e-mail a valid legal proxy will be issued a meeting control number that will allow them to register to attend and participate in the extraordinary general meeting virtually. You will receive an e-mail prior to the meeting with a link and instructions for entering the extraordinary general meeting.
A complete list of Silver Crest shareholders of record entitled to vote at the extraordinary general meeting will be available for ten days before the extraordinary general meeting at the principal executive offices of Silver Crest for inspection by shareholders during business hours for any purpose germane to the extraordinary general meeting.
Voting on all resolutions at the extraordinary general meeting will be conducted by way of a poll rather than on a show of hands. On a poll, votes are counted according to the number of Silver Crest Ordinary Shares registered in each shareholder’s name which are voted, with each Silver Crest Ordinary Share carrying one vote.
Your vote is important regardless of the number of shares you own. Whether you plan to attend the extraordinary general meeting, please complete, sign, date and return the enclosed proxy card as soon as possible in the envelope provided. Submitting a proxy now will NOT prevent you from being able to attend and vote in person at the extraordinary general meeting. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly voted and counted.
If you have any questions or need assistance voting your Silver Crest Ordinary Shares, please contact D.F. King & Co., Inc. at +1-800-967-7635. Questions can also be sent by email to SLCR@dfking.com. This notice of extraordinary general meeting is and the proxy statement/prospectus relating to the Business Combination will be available at https://                 .
Thank you for your participation. We look forward to your continued support.
By Order of the Board of Directors
Leon Meng
Chairman of the Board of Directors
                 , 2022
IF YOU RETURN YOUR SIGNED PROXY CARD WITHOUT AN INDICATION OF HOW YOU WISH TO VOTE, YOUR SHARES WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS.
ALL HOLDERS (“SILVER CREST PUBLIC SHAREHOLDERS”) OF SILVER CREST CLASS A SHARES ISSUED IN SILVER CREST’S INITIAL PUBLIC OFFERING (THE “PUBLIC SHARES”) HAVE THE RIGHT TO HAVE THEIR PUBLIC SHARES REDEEMED FOR CASH IN CONNECTION WITH THE PROPOSED BUSINESS COMBINATION. SILVER CREST PUBLIC SHAREHOLDERS 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 PUBLIC SHARES REDEEMED FOR CASH.
THIS MEANS THAT ANY SILVER CREST PUBLIC SHAREHOLDER 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, SILVER CREST PUBLIC SHAREHOLDERS MUST DEMAND THAT SILVER CREST REDEEM THEIR PUBLIC SHARES AND EITHER TENDER
 

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THEIR SHARE CERTIFICATES (IF ANY) TO CONTINENTAL STOCK TRANSFER & TRUST COMPANY, SILVER CREST’S TRANSFER AGENT, OR DELIVER THEIR PUBLIC SHARES TO THE TRANSFER AGENT ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DEPOSIT/WITHDRAWAL AT CUSTODIAN (DWAC) SYSTEM, IN EACH CASE NO LATER THAN TWO (2) BUSINESS DAYS PRIOR TO THE EXTRAORDINARY GENERAL MEETING. IF THE BUSINESS COMBINATION IS NOT COMPLETED, THEN THESE SHARES WILL NOT BE REDEEMED FOR CASH AND WILL BE RETURNED TO YOU OR YOUR ACCOUNT. IF YOU HOLD THE SHARES IN STREET NAME, YOU WILL NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BANK OR BROKER TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. ANY HOLDER THAT HOLDS PUBLIC SHARES BENEFICIALLY THROUGH A NOMINEE MUST IDENTIFY ITSELF BY LEGAL NAME, PHONE NUMBER AND ADDRESS TO SILVER CREST IN CONNECTION WITH ANY REDEMPTION ELECTION IN ORDER TO VALIDLY REDEEM SUCH PUBLIC SHARES. SEE “EXTRAORDINARY GENERAL MEETING OF SILVER CREST SHAREHOLDERS — REDEMPTION RIGHTS” FOR MORE SPECIFIC INSTRUCTIONS.
 

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ABOUT THIS PROXY STATEMENT/PROSPECTUS
This proxy statement/prospectus, which forms a part of a registration statement on Form F-4 filed with the SEC by THIL, constitutes a prospectus of THIL under Section 5 of the Securities Act of 1933, as amended (the “Securities Act”), with respect to the THIL Ordinary Shares and THIL Warrants to be issued to Silver Crest securityholders in connection with the Business Combination. This document also constitutes a proxy statement of Silver Crest under Section 14(a) of the Exchange Act, and the rules thereunder, and a notice of meeting with respect to the extraordinary general meeting of Silver Crest shareholders to consider and vote upon the proposals to adopt the Business Combination Proposal (as described below) , to adopt the Merger Proposal (as described below) and, if necessary, to adopt the Adjournment Proposal (as described below):
1.
Proposal No. 1 — The Business Combination Proposal — to consider and vote upon, as an ordinary resolution, a proposal to approve and authorize the Agreement and Plan of Merger, dated as of August 13, 2021, by and among Silver Crest, TH International Limited (“THIL”) and Miami Swan Ltd, a Cayman Islands exempted company and a wholly-owned subsidiary of THIL (“Merger Sub”) (such agreement, as amended by Amendment No. 1 to the Agreement and Plan of Merger, dated as of January 30, 2022 and Amendment No. 2 to the Agreement and Plan of Merger, dated March 9, 2022, in each case by and among Silver Crest, THIL and Merger Sub, and as may be further amended from time to time, the “Merger Agreement”), a copy of which is attached to this proxy statement/prospectus as Annex A, and the transactions contemplated therein, including the business combination whereby Merger Sub will merge with and into Silver Crest (the “First Merger”), with Silver Crest surviving the First Merger as a wholly owned subsidiary of THIL, and immediately thereafter and as part of the same overall transaction, Silver Crest (as the surviving entity of the First Merger) will merge with and into THIL, with THIL surviving the merger (the “Business Combination Proposal”);
2.
Proposal No. 2 — The Merger Proposal — to consider and vote upon, as a special resolution, a proposal to approve and authorize the First Merger and the Plan of Merger by and among Silver Crest, Merger Sub and THIL, substantially in the form attached to this proxy statement/prospectus as Annex C (the “Merger Proposal”); and
3.
Proposal No. 3 — The Adjournment Proposal — to consider and vote upon, as an ordinary resolution, a proposal to adjourn the extraordinary general meeting to a later date or dates to be determined by the chairman of the extraordinary general meeting, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the extraordinary general meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote (the “Adjournment Proposal”).
Unless otherwise indicated or the context otherwise requires, all references in this proxy statement/prospectus to “THIL” refer to TH International Limited together with its subsidiaries. All references in this proxy statement/prospectus to “Silver Crest” refer to Silver Crest Acquisition Corporation.
 
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MARKET, INDUSTRY AND OTHER DATA
This proxy statement/prospectus contains estimates, projections and other information concerning the industry in which THIL’s subsidiaries operate, including market size and growth of the markets in which it participates, that are based on industry publications and reports and forecasts prepared by its management. In some cases, THIL does not expressly refer to the sources from which these estimates and information are derived. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to these estimates. THIL has not independently verified the accuracy or completeness of the data contained in these industry publications and reports. The industry in which THIL’s subsidiaries operate 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.” These and other factors could cause results to differ materially from those expressed in these publications and reports.
The sources of certain statistical data, estimates, and forecasts contained in this proxy
statement/prospectus include independent industry reports from Global Market Trajectory & Analytics
and the Department of Agriculture Foreign Agricultural Service.
Certain estimates of market opportunity, including internal estimates of the addressable market for THIL’s subsidiaries and forecasts of market growth, included in this proxy statement/prospectus may prove inaccurate. Market opportunity estimates and growth forecasts, whether obtained from third-party sources or developed internally, are subject to significant uncertainty and are based on assumptions and estimates that may prove to be inaccurate. The estimates and forecasts in this proxy statement/prospectus relating to the size of THIL’s target market, market demand and adoption, capacity to address this demand, and pricing may prove to be inaccurate. The addressable market THIL estimates may not materialize for many years, if ever, and even if the markets in which it competes meet the size estimates in this proxy statement/prospectus, THIL could fail to successfully address or compete in such markets, if at all.
Certain monetary amounts, percentages and other figures included in this proxy statement/prospectus have been subject to rounding adjustments. Certain other amounts that appear in this proxy
statement/prospectus may not sum due to rounding.
 
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STATEMENT REGARDING TIM HORTONS
TIM HORTONS® is a registered trademark of Tim Hortons Restaurants International GmbH (“THRI”), a subsidiary of Restaurant Brands International Inc. (“RBI”). The offering of securities pursuant to the transaction has not been endorsed by RBI or any its subsidiaries, affiliates, officers, directors, agents, employees or advisors; other than in their capacity, as applicable, as a director of THIL. The grant of a “Tim Hortons” franchise to THIL in mainland China, Hong Kong and Macau by THRI should not be construed as an express or implied approval or endorsement of any statement regarding performance of THIL and/or its subsidiaries (financial or otherwise) in this proxy statement/prospectus. In making an investment decision, an investor must rely on its own examination of THIL and the terms of the Transactions.
The enforcement or waiver of any obligation of THIL under the applicable franchise agreements is generally a matter of the franchisor’s sole discretion. No investor should rely on any representation, assumption or belief that THRI will enforce or waive particular obligations of THIL under those agreements.
TRADEMARKS, TRADE NAMES AND SERVICE MARKS
THIL has proprietary rights to trademarks used in this proxy statement/prospectus that are important to its business, many of which are registered under applicable intellectual property laws. This proxy
statement/prospectus also contains trademarks, trade names and service marks of other companies, which are the property of their respective owners. Solely for convenience, trademarks, trade names and service marks referred to in this proxy statement/prospectus may appear without the ®, ™ or SM symbols, but such references are not intended to indicate, in any way, that THIL will not assert, to the fullest extent permitted under applicable law, its rights or the right of the applicable licensor to these trademarks, trade names and service marks. THIL 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 THIL by, any other parties.
IMPORTANT INFORMATION ABOUT EXCHANGE RATES
Certain information presented in this proxy statement/prospectus has been converted from Renminbi to U.S. dollars at a rate of RMB6.3521 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on December 31, 2021. Exchange rates fluctuate, and such fluctuation can be significant.
 
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SELECTED DEFINITIONS
“Ancillary Documents”
means the Sponsor Voting and Support Agreement, the Registration Rights Agreement, the Plan of Merger, the Second Plan of Merger, THIL’s equity incentive plan, as modified pursuant to the Merger Agreement, the THIL Shareholder Lock-Up and Support Agreement, the Sponsor Lock-Up Agreement and each other agreement, document, instrument and/or certificate entered into in connection with the Merger Agreement or therewith and any and all exhibits and schedules thereto.
“Board” means the board of directors of THIL after the closing of the Business Combination.
“BofA Securities”
means Merrill Lynch (Asia Pacific) Limited.
“Cayman Companies Law”
means the Companies Act (as amended) of the Cayman Islands.
“Dissent Rights”
means the right of each holder of record of Silver Crest Ordinary Shares to dissent in respect of the First Merger pursuant to Section 238 of the Cayman Companies Law.
“Dissenting Silver Crest Shareholders”
means holders of Dissenting Silver Crest Shares.
“Dissenting Silver Crest Shares”
means Silver Crest Ordinary Shares that are (i) issued and outstanding immediately prior to the First Effective Time and (ii) held by Silver Crest shareholders who have validly exercised their Dissent Rights (and not waived, withdrawn, lost or failed to perfect such rights).
“Exchange Act”
means the Securities Exchange Act of 1934, as amended.
“First Effective Time”
means the effective time of the First Merger.
“Founder Shares”
means the 8,625,000 Silver Crest Class B Shares held by the Sponsor, which were acquired for an aggregate purchase price of $25,000 prior to the Silver Crest IPO.
“Hong Kong Subsidiaries”
means TH Hong Kong International Limited and any other Hong Kong-incorporated subsidiary that THIL may have in the future.
“PCAOB” means the Public Company Accounting Oversight Board.
“Plan of Merger”
means the plan of merger for the First Merger pursuant to which Merger Sub will be merged with and into Silver Crest, following which the separate corporate existence of Merger Sub shall cease and Silver Crest shall continue as the surviving entity.
“PRC” means the People’s Republic of China (excluding, for purposes of this proxy statement/prospectus, the Hong Kong Special Administrative Region, the Macau Special Administrative Region and Taiwan).
 
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“PRC Subsidiaries”
means Tim Hortons (China) Holdings Co., Ltd., Shanghai Donuts Enterprise Management Co., Ltd., Tim Hortons (Shanghai) Food and Beverage Co., Ltd., Tim Hortons (Beijing) Food and Beverage Co., Ltd., Tim Coffee (Shenzhen) Co., Ltd. and/or any other PRC-incorporated subsidiary that THIL may have in the future.
“Private Warrants”
means the warrants sold to Sponsor in the private placement consummated concurrently with Silver Crest IPO, each entitling its holder to purchase one Silver Crest Class A Share at an exercise price of $11.50 per share, subject to adjustment.
“Public Shares”
means all Silver Crest Class A Shares issued in the Silver Crest IPO.
“Public Warrants”
means the redeemable warrants issued in the Silver Crest IPO, each entitling its holder to purchase one Silver Crest Class A Share at an exercise price of $11.50 per share, subject to adjustment.
“Same-store sales growth”
means the percentage change in the sales of stores that have been operating for 12 months or longer during a certain period compared to the same period from the prior year. The same-store sales growth for any period of more than a month equals to the arithmetic average of the same-store sales growth of each month covered in the period. If a store was closed for seven days or more during any given month, its sales during that month and the same month in the comparison period are excluded for purposes of measuring same-store sales growth.
“Securities Act”
means the Securities Act of 1933, as amended.
“Silver Crest Articles”
means Silver Crest’s amended and restated memorandum and articles of association adopted by special resolution dated January 8, 2021.
“Silver Crest Class A Share”
means a Class A ordinary share of Silver Crest, par value $0.0001 per share.
“Silver Crest Class B Share”
means a Class B ordinary share of Silver Crest, par value $0.0001 per share.
“Silver Crest IPO”
means the initial public offering of Silver Crest, which was consummated on January 19, 2021.
“Silver Crest Public Shareholders”
means all holders of the Public Shares.
“Silver Crest Warrants”
means the Public Warrants and the Private Warrants.
“Sponsor” means Silver Crest Management LLC.
“Share Split”
means the share split to cause the deemed value of the outstanding THIL Ordinary Shares immediately prior to the First Effective Time to equal $10.00 per share on a fully diluted basis, based on THIL’s implied valuation immediately prior to the consummation of the Business Combination (which
 
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will be based on a base enterprise valuation of THIL of $1,400,000,000 and certain adjustments thereto as set forth in the Merger Agreement). Unless otherwise indicated, the information disclosed in this proxy statement/prospectus does not reflect the Share Split.
“system-wide stores”
means stores owned and operated by THIL and franchise stores.
“THIL” means TH International Limited and/or its subsidiaries. All references to “THIL” with respect to business operations shall mean THIL’s PRC Subsidiaries, unless otherwise indicated.
“THIL Articles”
means the second amended and restated memorandum and articles of association of THIL, substantially in the form attached to this proxy statement/prospectus as Annex B, to be adopted immediately prior to the First Effective Time.
“THIL Existing Articles”
means the amended and restated memorandum and articles of association of THIL adopted by special resolution dated February 26, 2021.
“THIL Ordinary Share”
means an ordinary share of THIL, with a par value per share to be calculated pursuant to the methodology set forth in the Merger Agreement.
“THIL Warrants”
means the warrants into which the Silver Crest Warrants convert at the First Effective Time, each entitling its holder to purchase one THIL Ordinary Share at a price of $11.50 per share, subject to adjustment.
“UBS” means UBS Securities LLC.
“Transactions” means the transactions contemplated by the Merger Agreement and the Ancillary Documents.
“Units” means the units issued in the Silver Crest IPO, each consisting of one Silver Crest Class A Share and one-half of one Public Warrant.
“U.S. dollars”, “U.S.$” or“$”
means the legal currency of the United States.
“U.S. GAAP”
means accounting principles generally accepted in the United States of America.
 
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QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION AND
THE EXTRAORDINARY GENERAL MEETING
The questions and answers below highlight only selected information set forth elsewhere in this proxy statement/prospectus and only briefly address some commonly asked questions about the extraordinary general meeting and the proposals to be presented at the extraordinary general meeting, including with respect to the proposed Business Combination. The following questions and answers do not include all the information that may be important to Silver Crest shareholders. Silver Crest shareholders are urged to carefully read this entire proxy statement/prospectus, including the annexes and the other documents referred to herein, to fully understand the proposed Business Combination and the voting procedures for the extraordinary general meeting.
Q: Why am I receiving this proxy statement/prospectus?
A: Silver Crest and THIL have agreed to a business combination under the terms of the Merger Agreement that is described in this proxy statement/prospectus. A copy of the Merger Agreement is attached to this proxy statement/prospectus as Annex A and Silver Crest encourages its shareholders to read it in its entirety. Silver Crest’s shareholders are being asked to consider and vote upon a proposal to approve the Merger Agreement, which, among other things, provides for Merger Sub to be merged with and into Silver Crest with Silver Crest surviving the merger as a wholly-owned subsidiary of THIL, and immediately thereafter and as part of the same overall transaction, Silver Crest (as the surviving entity of the First Merger) merging with and into THIL, which will become the parent/public company following the Business Combination, and the other Transactions contemplated by the Merger Agreement. See “Proposal One — The Business Combination Proposal.”
Q: Are there any other matters being presented to shareholders at the meeting?
A: In addition to voting on the Business Combination Proposal, the shareholders of Silver Crest will vote on the following proposals:

To authorize the First Merger and the Plan of Merger. See the section of this proxy statement/prospectus titled “Proposal Two — The Merger Proposal.”

To consider and vote upon a proposal to adjourn the extraordinary general meeting to a later date or dates to be determined by the chairman of the extraordinary general meeting, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the extraordinary general meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote. See the section of this proxy statement/prospectus titled “Proposal Three — The Adjournment Proposal.”
Silver Crest will hold the extraordinary general meeting of its shareholders to consider and vote upon these proposals. This proxy statement/prospectus contains important information about the proposed Business Combination and the other matters to be acted upon at the extraordinary general meeting. Shareholders should read it carefully.
The vote of shareholders is important. Regardless of how many shares you own, you are encouraged to vote as soon as possible after carefully reviewing this proxy statement/prospectus.
Q: Why is Silver Crest providing shareholders with the opportunity to vote on the Business Combination?
A: Pursuant to the Silver Crest Articles, Silver Crest is required to provide Silver Crest Public Shareholders with an opportunity to have their Public Shares redeemed for cash upon the consummation of its initial business combination, either in conjunction with a shareholder vote or tender offer. Due to the structure of the Transactions, Silver Crest is providing this opportunity in conjunction with a shareholder vote.
Q: What will happen to Silver Crest’s securities upon consummation of the Business Combination?
A: Silver Crest’s securities, namely the Units (trading symbol “SLCRU”), Silver Crest Class A Shares (trading symbol “SLCR”) and Public Warrants (trading symbol “SLCRW”), are currently listed on Nasdaq. The Units, Silver Crest Class A Shares and Public Warrants will cease trading upon consummation of the
 
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Business Combination and will be delisted from Nasdaq and deregistered under the Exchange Act. THIL intends to apply for listing of THIL Ordinary Shares on Nasdaq under the proposed symbol “THCH” and THIL Warrants under the proposed symbol “THCHW”, each to be effective upon the consummation of the Business Combination. While trading on Nasdaq is expected to begin on the first business day following the consummation of the Business Combination, there can be no assurance that THIL Ordinary Shares and THIL Warrants will be listed on Nasdaq or that a viable and active trading market will develop. See “Risk Factors — Risks Related to THIL’s Securities” for more information.
Q: Why is Silver Crest proposing the Business Combination?
A: Silver Crest was organized to effect a merger, share exchange, asset acquisition, share purchase, reorganization or other similar business combination with one or more businesses or entities.
On January 19, 2021, Silver Crest consummated the Silver Crest IPO of 34,500,000 Units (inclusive of the exercise by the underwriters of the over-allotment in full) at an offering price of $10.00 per Unit, generating total gross proceeds of $345,000,000. Following the closing of the Silver Crest IPO, an amount equal to $345,000,000 from the net proceeds of the sale of the Units in the Silver Crest IPO and the sale of the Private Warrants was placed into a trust account (the “Trust Account”). Since the Silver Crest IPO, Silver Crest’s activity has been limited to the evaluation of business combination candidates.
Silver Crest believes THIL is a company with an appealing market opportunity and growth profile, a strong position in its industry and a compelling valuation. As a result, Silver Crest believes that the Business Combination will provide Silver Crest shareholders with an opportunity to participate in the ownership of a company with significant growth potential. See the section entitled “Proposal One — The Business Combination Proposal — Silver Crest’s Board of Directors’ Reasons for the Business Combination.”
Q: Did Silver Crest’s board of directors obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Business Combination?
A: No. Silver Crest’s board of directors did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the Business Combination. Accordingly, investors will be relying solely on the judgment of Silver Crest’s board of directors, its management team and its advisors in valuing THIL and will be assuming the risk that Silver Crest’s board of directors may not have properly valued the business. However, Silver Crest’s officers and directors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and have substantial experience with mergers and acquisitions. Furthermore, in analyzing the Business Combination, Silver Crest’s board of directors conducted significant due diligence on THIL. Based on the foregoing, Silver Crest’s board of directors concluded that its members’ collective experience and backgrounds, together with the experience and sector expertise of Silver Crest’s advisors, enabled it to make the necessary analyses and determinations regarding the Business Combination, including that the Business Combination was fair from a financial perspective to its shareholders and that THIL’s fair market value was at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on interest earned on the Trust Account) at the time the Merger Agreement was entered into with respect to the Business Combination. There can be no assurance, however, that Silver Crest’s board of directors was correct in its assessment of the Business Combination. For a complete discussion of the factors utilized by Silver Crest’s board of directors in approving the Business Combination, see the section entitled “Proposal One — The Business Combination Proposal.”
Q: Do I have redemption rights?
A: If you are a Silver Crest Public Shareholder, you have the right to demand that Silver Crest redeem your Public Shares for a pro rata portion of the cash held in Silver Crest’s Trust Account, calculated as of two (2) business days prior to the consummation of the Business Combination in accordance with the Silver Crest Articles. In this proxy statement/prospectus, these rights to demand redemption of the Public Shares are sometimes referred to as “redemption rights.”
Notwithstanding the foregoing, a Silver Crest Public Shareholder, together with any affiliate of his or any other person with whom such holder is acting in concert or as a “group” ​(as defined in Section 13(d)(3)
 
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of the Exchange Act), will be restricted from seeking redemption rights with respect to more than 15% of the Public Shares. Accordingly, all Public Shares in excess of 15% held by a Silver Crest Public Shareholder, together with any affiliate of such holder or any other person with whom such holder is acting in concert or as a “group,” will not be redeemed and converted into cash.
Under the Silver Crest Articles, the Business Combination may not be consummated if Silver Crest has net tangible assets of less than $5,000,001 either immediately prior to or upon consummation of the Business Combination after taking into account the redemption for cash of all Public Shares properly demanded to be redeemed by holders of Public Shares.
Q: Will how I vote on the Business Combination affect my ability to exercise my redemption rights?
A: No. A Silver Crest Public Shareholder may exercise redemption rights regardless of whether he, she or it votes for or against the Business Combination Proposal or does not vote on such proposal at all, or if he, she or it is a Silver Crest Public Shareholder on the record date. This means that any Silver Crest Public Shareholder holding Public Shares may exercise redemptions rights regardless of whether they are even entitled to vote on the Business Combination Proposal.
Q: How do I exercise my redemption rights?
A: If you are a Silver Crest Public Shareholder and wish to exercise your redemption rights, you must:

submit a written request to Continental Stock Transfer & Trust Company, Silver Crest's transfer agent, in which you (i) request that Silver Crest redeem all or a portion of your Public Shares for cash, and (ii) identify yourself as the beneficial holder of the Public Shares and provide your legal name, phone number and address; and

either tender your share certificates (if any) to Continental Stock Transfer & Trust Company, Silver Crest's transfer agent, or deliver your Public Shares to the transfer agent electronically using The Depository Trust Company’s Deposit/Withdrawal at Custodian (DWAC) System.
Holders must complete the procedures for electing to redeem their Public Shares in the manner described above prior to on       , 2022, two (2) business days prior to the extraordinary general meeting, in order for their Public Shares to be redeemed. If you hold the shares in “street name,” you will have to coordinate with your broker, bank or nominee to have the Public Shares you beneficially own certificated and delivered electronically.”
Any Silver Crest Public Shareholder satisfying the requirements for exercising redemption rights will be entitled to a pro rata portion of the amount then in the Trust Account (which, for illustrative purposes, was $      , or $      per share, as of the record date) calculated as of two (2) business days prior to the consummation of the Business Combination, including interest earned on the funds in the Trust Account and not previously released to Silver Crest to pay income taxes. Such amount will be paid promptly upon consummation of the Business Combination. There are currently no owed but unpaid income taxes on the funds in the Trust Account.
There is a nominal cost associated with this tendering process and the act of certificating the shares or delivering them through the DWAC system. The transfer agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not to pass this cost on to the redeeming shareholder. In the event the Business Combination is not consummated this may result in an additional cost to shareholders for the return of their shares.
Any request for redemption, once made by a Silver Crest Public Shareholder, may be withdrawn at any time prior to the time the vote is taken with respect to the Business Combination Proposal at the extraordinary general meeting. If you tender your share certificates (if any) to Silver Crest’s transfer agent and later decide prior to the extraordinary general meeting not to elect redemption, you may request that Silver Crest’s transfer agent return your share certificates (physically or electronically). You may make such request by contacting Silver Crest’s transfer agent at the address listed below.
No demand for redemption will be honored unless the holder’s Public Shares have been delivered (either physically or electronically) to the transfer agent in the manner described above no later than two (2) business days prior to the extraordinary general meeting.
 
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Silver Crest’s transfer agent can be contacted at the following address:
Continental Stock Transfer & Trust Company
1 State Street — 30th Floor
New York, New York 10004
Attn: Compliance Department
Email: Compliance@continentalstock.com
Q: Can I exercise redemption rights and dissenter rights under the Cayman Companies Law?
A: No. Any Silver Crest Public Shareholder who elects to exercise Dissent Rights (which dissenter rights are discussed in the section titled “Do I have appraisal rights if I object to the proposed Business Combination?”) will lose their right to have their Public Shares redeemed in accordance with the Silver Crest Articles. The certainty provided by the redemption process may be preferable for Silver Crest Public Shareholders wishing to exchange their Public Shares for cash. This is because Dissent Rights may be lost or extinguished, including where Silver Crest and the other parties to the Merger Agreement determine to delay the consummation of the Business Combination in order to invoke the limitation on dissenter rights under Section 239 of the Cayman Companies Law, in which case any Silver Crest Public Shareholder who has sought to exercise Dissent Rights would only be entitled to receive the merger consideration comprising one THIL Ordinary Share for each of their Public Shares.
Q: If I am a holder of Silver Crest Units, can I exercise redemption rights with respect to my Units?
A: No. Holders of outstanding Units must first separate the Units into the underlying Public Shares and Public Warrants prior to exercising redemption rights with respect to Public Shares.
If you hold Units registered in your own name, you must deliver the certificate for such Units (if any) to Continental Stock Transfer & Trust Company, Silver Crest's transfer agent, with written instructions to separate such Units into Public Shares and Silver Crest Public Warrants. This must be completed far enough in advance to permit the mailing of the share certificates back to you so that you may then exercise your redemption rights upon the separation of the Public Shares from the Units.
If you hold the Units in “street name,” you will need to instruct your broker, bank or nominee to separate the Units you beneficially own. Your nominee must send written instructions to Silver Crest's transfer agent. Such written instructions must include the number of Units to be split and the nominee holding such Units. Your nominee must also initiate electronically, using The Depository Trust Company’s Deposit/Withdrawal at Custodian (DWAC) System, a withdrawal of the relevant Units and a deposit of the number of Public Shares and Public Warrants represented by such Units. This must be completed far enough in advance to permit your nominee to exercise redemption rights upon the separation of the Public Shares from the Units. While this is typically done electronically the same business day, you should allow at least one full business day to accomplish the separation. If you fail to cause your Public Shares to be separated in a timely manner, you shall likely not be able to exercise your redemption rights.
Q: If I am a holder of Silver Crest Warrants, can I exercise redemption rights with respect to my warrants?
A: No. The holders of Silver Crest Warrants have no redemption rights with respect to such securities.
Q: What are the U.S. federal income tax consequences to me if I exercise my redemption rights?
A: A U.S. Holder (as defined below) who exercises its redemption rights will receive cash in exchange for the tendered shares, and either will be considered for U.S. federal income tax purposes to have made a sale or exchange of the tendered shares, or will be considered for U.S. federal income tax purposes to have received a distribution with respect to such shares that may be treated as: (i) dividend income, (ii) a nontaxable recovery of basis in his investment in the tendered shares, or (iii) gain (but not loss) as if the shares with respect to which the distribution was made had been sold. See the section entitled “Taxation — Material U.S. Federal Income Tax Considerations — U.S. Holders — U.S. Holders Exercising Redemption Rights with Respect to Silver Crest Ordinary Shares.”
 
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Q: What are the U.S. federal income tax consequences of the Business Combination to me?
A: It is intended that the Business Combination qualify as a “reorganization” within the meaning of Section 368(a) of the United States Internal Revenue Code of 1986, as amended (the “Code”) with respect to U.S. Holders of the Silver Crest Ordinary Shares and/or Silver Crest Warrants. However, there are significant factual and legal uncertainties as to whether the Business Combination will qualify as a reorganization within the meaning of Section 368(a) of the Code. If any requirement for Section 368(a) of the Code is not met, then a U.S. Holder of Silver Crest Ordinary Shares and/or Silver Crest Warrants generally would recognize gain or loss in an amount equal to the difference, if any, between the fair value of THIL Ordinary Shares and/or THIL Warrants, as applicable, received in the Business Combination, over such U.S. Holder’s aggregate tax basis in the corresponding Silver Crest Ordinary Shares and/or Silver Crest Warrants surrendered by such U.S. Holder in the Business Combination. Even if the Business Combination otherwise qualifies as a “reorganization” within the meaning of Section 368(a) of the Code, U.S. Holders may be required to recognize gain (but not loss) on account of the application of the Passive Foreign Investment Company (“PFIC”) rules, as described in more detail below under “Taxation — Material U.S. Federal Income Tax Considerations — U.S. Holders — The Business Combination — Application of the PFIC Rules to the Business Combination.”
U.S. Holders of Silver Crest Ordinary Shares and/or Silver Crest Warrants should consult their tax advisors to determine the tax consequences if the Business Combination does not qualify as a “reorganization” within the meaning of Section 368(a) of the Code and the application of the PFIC rules to their specific situation in connection with the Business Combination.
Q: Do I have appraisal rights if I object to the proposed Business Combination?
A: Holders of record of Silver Crest Ordinary Shares may have appraisal rights in connection with the Business Combination under the Cayman Companies Law. Holders of record of Silver Crest Ordinary Shares wishing to exercise such statutory dissenter rights and make a demand for payment of the fair value for his, her or its Silver Crest Ordinary Shares must give written objection to the First Merger to Silver Crest prior to the shareholder vote to approve the First Merger and follow the procedures set out in Section 238 of the Cayman Companies Law, noting that any such dissenter rights may subsequently be lost and extinguished pursuant to Section 239 of the Cayman Companies Law which states that no such dissenter rights shall be available in respect of shares of any class for which an open market exists on a recognized stock exchange or recognized interdealer quotation system at the expiry date of the period allowed for written notice of an election to dissent provided that the merger consideration constitutes inter alia shares of any company which at the effective date of the merger are listed on a national securities exchange. Silver Crest believes that such fair value would equal the amount that Silver Crest shareholders would obtain if they exercised their redemption rights as described herein. A Silver Crest shareholder which elects to exercise appraisal rights must do so in respect of all of the Silver Crest Ordinary Shares that person holds and will lose their right to exercise their redemption rights as described herein. See the section of this proxy statement/prospectus titled “Extraordinary General Meeting of Silver Crest Shareholders — Appraisal Rights under the Cayman Companies Law.”
Silver Crest shareholders are recommended to seek their own advice as soon as possible on the application and procedure to be followed in respect of the appraisal rights under the Cayman Companies Law.
Q: What happens to the funds deposited in the Trust Account after consummation of the Business Combination?
A: The net proceeds of the Silver Crest IPO, together with a portion of the proceeds from the sale of the Private Warrants in a private placement to the Sponsor, equal in the aggregate to $345,000,000, was placed in the Trust Account immediately following the Silver Crest IPO. After consummation of the Business Combination, the funds in the Trust Account will be used to pay, on a pro rata basis, Silver Crest Public Shareholders who exercise redemption rights and to pay fees and expenses incurred in connection with the Business Combination (including aggregate fees of approximately $12 million to the underwriter of the Silver Crest IPO as deferred underwriting commissions). Any remaining cash will be used for THIL’s working capital and general corporate purposes.
 
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Q: What happens if a substantial number of public shareholders vote in favor of the Business Combination Proposal and exercise their redemption rights?
A: Silver Crest Public Shareholders may vote in favor of the Business Combination and still exercise their redemption rights, although they are not required to vote in any way to exercise such redemption rights. Accordingly, the Business Combination may be consummated even though the funds available from the Trust Account and the number of Silver Crest Public Shareholders are substantially reduced as a result of redemptions by Silver Crest Public Shareholders.
If a Silver Crest Public Shareholder exercises his, her or its redemption rights, such exercise will not result in the loss of any warrants that such Silver Crest Public Shareholder may hold. Even if Silver Crest Public Shareholders holding 30,735,966 Public Shares exercise their redemption rights, which is the maximum number of Public Shares that could be redeemed by Silver Crest Public Shareholders that allows the consummation of the Business Combination, 17,250,000 Public Warrants (representing the right to purchase 17,250,000 THIL Ordinary Shares upon their exercise) will remain outstanding. Accordingly, if a substantial number of, but not all, Silver Crest Public Shareholders exercise their redemption rights, any non-redeeming Silver Crest Public Shareholders would experience dilution to the extent such Public Warrants are exercised and additional THIL Ordinary Shares are issued.
However, the Business Combination will not be consummated if, either immediately prior to or upon consummation of the Business Combination, Silver Crest would have net tangible assets of less than $5,000,001 after taking into account the redemption for cash of all Public Shares properly demanded to be redeemed by holders of Public Shares. To the extent that there are fewer public shares and public shareholders, the trading market for THIL Ordinary Shares may be less liquid than the market was for Silver Crest Class A Shares prior to the Transactions, and THIL may not be able to meet the listing standards of a national securities exchange. In addition, to the extent of any redemptions, fewer funds from the Trust Account would be available to THIL to be used in its business following the consummation of the Business Combination.
The sensitivity table below shows the potential impact of redemptions on the pro forma book value per share of the shares owned by non-redeeming Silver Crest Public Shareholders in the No Redemptions, 50% Redemption (which assumes that 50% of Silver Crest Class A Shares held by Silver Crest Public Shareholders are redeemed), and Maximum Redemptions Scenario, taking into account certain potential sources of dilution, namely, 7,405,464 shares underlying THIL’s granted share options and restricted share units, the Earn-out Shares, THIL Ordinary Shares to be issued to the PIPE Investors, 300,000 Commitment Shares issuable under the CEF Purchase Agreement (as defined below) (assuming that the trading price of THIL Ordinary Shares on the Commitment Shares Determination Date is $10.00 per share), 5,000,000 Equity Support Shares (the maximum number of THIL Ordinary Shares that could be issued under the ESA (as defined below), assuming that the existing PIPE Investment (as defined below) is fully funded and that at least 1,100,000 Silver Crest Public Shares are not redeemed) and THIL Ordinary Shares underlying the Public Warrants, the Private Warrants and THIL’s outstanding convertible notes. The table below does not take into account the CEF Shares, which may be issued by THIL from time to time at its option after the CEF Initial Resale Registration Statement (as defined below) becomes effective under the Securities Act and other conditions under the CEF Purchase Agreement are met. See “Summary — Recent Development — Committed Equity Facility” and “Summary — Recent Development —  Equity Support Agreement” for more details on the CEF Purchase Agreement, the Commitment Shares (as defined below), the Commitment Shares Determination Date (as defined below), the Equity Support Shares (as defined below), the ESA, the CEF Shares and related definitions.
Assuming
No Redemptions
Assuming
50% Redemptions
Assuming
Maximum Redemptions(1)
Shares
%
Shares
%
Shares
%
Holders of THIL Ordinary Shares without reflecting potential sources of dilution:(2)
Existing Silver Crest
shareholders(3)
34,500,000 20.86% 19,132,017 12.75% 3,764,034 2.80%
The Sponsor(4)
4,312,500 2.61% 4,312,500 2.88% 4,312,500 3.20%
 
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Assuming
No Redemptions
Assuming
50% Redemptions
Assuming
Maximum Redemptions(1)
Shares
%
Shares
%
Shares
%
Existing THIL shareholders(5)(6)
126,555,003 76.53% 126,555,003 84.37% 126,555,003 94.00%
Total THIL Ordinary Shares
outstanding at Closing
165,367,503 100.00% 149,999,520 100.00% 134,631,537 100.00%
Total THIL Ordinary Shares
outstanding at Closing not
reflecting potential sources of
dilution
165,367,503 73.15% 149,999,520 71.19% 134,631,537 68.93%
Potential sources of dilution:
Shares underlying granted option
shares and restricted shares
7,405,464 3.29% 7,405,464 3.51% 7,405,464 3.79%
Earn-out shares(6)
14,000,000 6.19% 14,000,000 6.64% 14,000,000 7.17%
Shares underlying Public Warrants(7)
17,250,000 7.63% 17,250,000 8.19% 17,250,000 8.83%
Shares underlying Private Warrants(8)
4,450,000 1.97% 4,450,000 2.12% 4,450,000 2.28%
Shares underlying the Notes(9)
6,039,533 2.67% 6,039,533 2.87% 6,039,533 3.09%
Shares underlying PIPE Investment(10)
5,750,000 2.54% 5,750,000 2.73% 5,750,000 2.94%
Sponsor PIPE Shares(15)
500,000 0.22% 500,000 0.24% 500,000 0.26%
Equity Support Shares(16)
5,000,000 2.21% 5,000,000 2.37% 5,000,000 2.56%
Commitment Shares(17)
300,000 0.13% 300,000 0.14% 300,000 0.15%
Total THIL Ordinary Shares outstanding at Closing (including shares underlying granted option shares and restricted shares, earn-out shares, PIPE shares, shares underlying warrants and shares underlying the Notes)
226,062,500
100.00%
210,694,517
100.00%
195,326,534
100.00%
Holders of THIL Ordinary Shares
reflecting potential sources of
dilution:
Existing Silver Crest shareholders(11)
51,750,000 22.89% 36,382,017 17.27% 21,014,034 10.76%
The Sponsor(12)
9,262,500 4.10% 9,262,500 4.40% 9,262,500 4.75%
Existing THIL shareholders(5)
147,960,467 65.46% 147,960,467 70.22% 147,960,467 75.75%
Holders of the Notes(9)
6,039,533 2.67% 6,039,533 2.87% 6,039,533 3.09%
PIPE Investors(10)
5,750,000 2.54% 5,750,000 2.73% 5,750,000 2.94%
ESA Investors(16)
5,000,000 2.21% 5,000,000 2.37% 5,000,000 2.56%
Cantor(17) 300,000 0.13% 300,000 0.14% 300,000 0.15%
Total Pro Forma Equity Value of
THIL Ordinary Shares
outstanding at Closing (including
shares underlying granted option
shares and restricted shares,
earn-out shares, shares underlying
warrants and shares underlying the
Notes)(13)
$
2,260,625,000
$
2,106,945,170
$
1,953,265,340
 
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Assuming
No Redemptions
Assuming
50% Redemptions
Assuming
Maximum Redemptions(1)
Shares
%
Shares
%
Shares
%
Per Share Pro Forma Equity Value of THIL Ordinary Shares outstanding at Closing(13)
10.00 10.00 10.00
Per Share Pro Forma Book Value of
THIL Ordinary Shares
outstanding at Closing (including
shares underlying granted option
shares and restricted shares,
earn-out shares, PIPE shares,
shares underlying warrants and
shares underlying the
Notes)(14)
$
1.98
$
1.40
$
0.72
(1)
Silver Crest’s obligations under the Merger Agreement are subject to certain customary closing conditions. Furthermore, Silver Crest will only proceed with the Business Combination if it will have net tangible assets of at least $5,000,001 upon consummation of the Business Combination (as determined in accordance with Rule3a5l-l(g)(1) of the Exchange Act (or any successor rule)).
(2)
Excluding 14,000,000 Earn-out Shares, THIL Ordinary Shares underlying the Public Warrants and THIL Ordinary Shares underlying the Private Warrants. Pursuant to the Merger Agreement, if certain price milestones are achieved on or before the 5th anniversary of the Closing, existing THIL shareholders will receive 14,000,000 Earn-Out Shares. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-out.”
(3)
Excluding the Sponsor.
(4)
Including 1,400,000 THIL Ordinary Shares subject to earn-in provisions that, after the completion of the Business Combination, will be subject to forfeiture relating to the occurrence of future events (the ‘‘Earn-in Shares’’). Pursuant to the Sponsor Lock-Up Agreement, of the 4,312,500 THIL Ordinary Shares to be issued to Sponsor upon the consummation of the Mergers (as a result of the automatic conversion of 4,312,500 Silver Crest Class B Shares held by the Sponsor into Silver Crest Class A Shares in accordance with Silver Crest Articles and the automatic conversion of each such Silver Crest Class A Share into the right of the holder thereof to receive one THIL Ordinary Share upon the effectiveness of First Merger), 1,400,000 THIL Ordinary Shares will become unvested and subject to forfeiture, only to be vested if certain price milestones are achieved on or before the 5th anniversary of the Closing. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-in.
(5)
Excluding 7,405,464 shares underlying THIL’s granted share options and restricted share units and 6,039,533 shares underlying THIL’s outstanding convertible notes, which are convertible into fully paid, validly issued and nonassessable THIL Ordinary Shares at a conversion price equal to $11.50 per share at any time on or after the earlier of September 30, 2022 and the Closing (see “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional details).
(6)
After the completion of the Business Combination, existing THIL shareholders prior to the completion of the Business Combination will receive the right to receive, in the aggregate, 14,000,000 additional THIL Ordinary Shares, contingent upon the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-out.
(7)
The Public Warrants are redeemable warrants issued in the Silver Crest IPO, each entitling its holder to purchase one Silver Crest Class A Share at an exercise price of $11.50 per share, subject to adjustment. In connection with the Business Combination, such warrants will be automatically and irrevocably assumed by THIL and converted into a corresponding warrant exercisable for THIL Ordinary Shares. Based on the average of the high (US$0.44) and low (US$0.42) prices for the Public Warrants on Nasdaq on March 23, 2022, the value of the total outstanding Public Warrants would be $7,417,500.
(8)
The Private Warrants are warrants sold to Sponsor in the private placement consummated concurrently with the Silver Crest IPO, each entitling its holder to purchase one Silver Crest Class A Share at an exercise price of $11.50 per share, subject to adjustment. In connection with the Business Combination, such warrants will be automatically and irrevocably assumed by THIL and converted into a corresponding warrant exercisable for THIL Ordinary Shares. Based on the average of the high (US$0.44) and low (US$0.42) prices for the Public Warrants on Nasdaq on March 23, 2022 and pursuant to Amendment No. 1 to the Sponsor Voting and Support Agreement, the value of the Private Warrants outstanding upon the Closing would be $1,913,500. In the event that, following consummation of the Business Combination, the Sponsor exercises the Private Warrants, the ownership of non-redeeming Silver Crest Public Shareholders in THIL would be diluted due to the issuance of THIL Ordinary Shares underlying such Private Warrants to the Sponsor.
(9)
Representing THIL Ordinary Shares underlying THIL’s outstanding convertible notes, which are convertible into fully paid, validly issued and non-assessable THIL Ordinary Shares at a conversion price equal to $11.50 per share at any time on or after the earlier of September 30, 2022 and the Closing (see “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional details).
 
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(10)
Representing the aggregate of 4,550,000 THIL Ordinary Shares and 1,200,000 THIL Warrants to be issued to certain shareholders of Pangaea Two Acquisition Holdings XXIIB Limited and THIL, an affiliate of Cartesian Capital Group, LLC and a holder of the Notes (as defined below), of which 600,000 THIL Ordinary Shares and 1,200,000 THIL Warrants will be issued for no consideration to the investors that agree to pay a purchase price of at least $10,000,000, and excluding 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL. See “Agreements Entered into in Connection with the Business Combination — PIPE Subscription Agreements” and “Beneficial Ownership of Securities” for additional details.
(11)
Excluding the Sponsor and including 17,250,000 THIL Ordinary Shares underlying Public Warrants.
(12)
Including 4,450,000 THIL Ordinary Shares underlying Private Warrants, 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL, and 1.4 million Earn-in Shares that, after the completion of the Business Combination, will be subject to forfeiture relating to the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-in.
(13)
In each of the No Redemptions, 50% Redemptions and Maximum Redemptions scenarios, the per share pro forma equity value of THIL Ordinary Shares will be $10.00 at Closing in accordance with the terms of the Merger Agreement.
(14)
The per share pro forma book value of THIL Ordinary Shares is based on the pro forma book value of THIL at Closing. See the row entitled “Total Equity Attributable to Shareholders of the Company” in the section entitled “Unaudited Pro Forma Condensed Combined Financial Information — Unaudited Pro Forma Combined Statement of Financial Position.
(15)
Representing the 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL. See “Agreements Entered into in Connection with the Business Combination — PIPE Subscription Agreements” and “Beneficial Ownership of Securities” for additional details.
(16)
Representing the maximum amount of THIL Ordinary Shares that could be issued to certain third-party investors under the ESA upon the Closing, assuming that the existing PIPE Investment is fully funded and that at least 1,100,000 Silver Crest Public Shares are not redeemed. See “Summary — Recent Development — Equity Support Agreement” for additional details.
(17)
Representing the amount of THIL Ordinary Shares issuable to CF Principal Investments LLC under the CEF Purchase Agreement after the Closing and before the filing of the CEF Initial Resale Registration Statement, assuming that the trading price of THIL Ordinary Shares on the Commitment Shares Determination Date is $10.00 per share. See “Summary — Recent Development — Committed Equity Facility” for additional details.
Q: What happens if the Business Combination is not consummated?
A: If Silver Crest does not complete the Business Combination with THIL for whatever reason, Silver Crest would search for another target business with which to complete a business combination. If Silver Crest does not complete the Business Combination with THIL or another business combination by January 19, 2023 (or such later date as may be approved by Silver Crest’s shareholders in an amendment to the Silver Crest Articles), Silver Crest must redeem 100% of the outstanding Public Shares, at a per-share price, payable in cash, equal to an amount then held in the Trust Account (net of taxes payable and less up to $100,000 of interest to pay dissolution expenses) divided by the number of outstanding Public Shares and, following such redemption, Silver Crest will liquidate and dissolve. The Sponsor and Silver Crest’s officers and directors have waived their redemption rights with respect to their Founder Shares in the event a business combination is not effected in the required time period, and, accordingly, their Founder Shares will be worthless.
Q: How do the Sponsor and the officers and directors of Silver Crest intend to vote on the proposals?
The Sponsor, as well as Silver Crest’s officers and directors, beneficially own and are entitled to vote an aggregate of approximately 20% of the outstanding Silver Crest Ordinary Shares. These holders have agreed to vote their shares in favor of the Business Combination Proposal. These holders have also indicated that they intend to vote their shares in favor of all other proposals being presented at the extraordinary general meeting. In addition to the Silver Crest Ordinary Shares held by the Sponsor and Silver Crest’s officers and directors, Silver Crest would need 12,937,501 Silver Crest Class A Shares, or approximately 37.5%, of the 34,500,000 Public Shares to be voted in favor of the Business Combination Proposal and 20,125,000 Silver Crest Class A Shares, or approximately 58.3%, of the 34,500,000 Public Shares to be voted in favor of the Merger Proposal in order for them to be approved (assuming all outstanding shares are voted on each proposal). The Sponsor and officers and directors of Silver Crest have agreed, prior to Silver Crest IPO, to waive their redemption rights.
 
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Q: Can the Sponsor and officers and directors of Silver Crest redeem their Founder Shares in connection with consummation of the Business Combination?
A: No. The Sponsor and Silver Crest’s officers and directors have agreed to waive, for no consideration and for the sole purpose of facilitating the Business Combination, their redemption rights with respect to their Founder Shares in connection with the consummation of the Business Combination.
Q: What interests do the Sponsor and the current officers and directors of Silver Crest have in the Business Combination?
A: In considering the recommendation of Silver Crest’s board of directors to vote in favor of the Business Combination, shareholders should be aware that, aside from their interests as shareholders, the Sponsor and certain of Silver Crest’s directors and officers have interests in the Business Combination that are different from, or in addition to, those of other shareholders generally. Silver Crest’s directors were aware of and considered these interests, among other matters, in evaluating the Business Combination, in recommending to shareholders that they approve the Business Combination and in agreeing to vote their shares in favor of the Business Combination. Shareholders should take these interests into account in deciding whether to approve the Business Combination. These interests include, among other things, the fact that:

If the Business Combination with THIL or another business combination is not consummated by January 19, 2023 (or such later date as may be approved by Silver Crest’s shareholders in an amendment to the Silver Crest Articles), Silver Crest will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding Public Shares for cash and, subject to the approval of its remaining shareholders and Silver Crest’s board of directors, dissolving and liquidating. In such event, the Founder Shares held by the Sponsor, which were acquired for an aggregate purchase price of $25,000 prior to the Silver Crest IPO, are expected to be worthless because the holders are not entitled to participate in any redemption or distribution of proceeds in the Trust Account with respect to such shares. On the other hand, if the Business Combination is consummated, each outstanding Silver Crest Ordinary Share will be converted into one THIL Ordinary Share, subject to adjustment described herein.

If Silver Crest is unable to complete a business combination within the required time period, the Sponsor will be liable under certain circumstances described herein to ensure that the proceeds in the Trust Account are not reduced by the claims of target businesses or claims of vendors or other entities that are owed money by Silver Crest for services rendered to, or contracted for or for products sold to Silver Crest. If Silver Crest consummates a business combination, on the other hand, Silver Crest will be liable for all such claims.

The Sponsor acquired the Founder Shares, which will be converted into THIL Ordinary Shares in connection with the Business Combination, for an aggregate purchase price of $25,000 prior to the Silver Crest IPO. Based on the average of the high (US$9.86) and low (US$9.83) prices for Silver Crest Class A Shares on Nasdaq on March 23, 2022 and pursuant to Amendment No. 1 to the Sponsor Voting and Support Agreement, the value of the Founder Shares outstanding upon the Closing would be $42,456,562.50.

The Sponsor acquired the Private Warrants, which will be converted into THIL Warrants in connection with the Business Combination, for an aggregate purchase price of $8.9 million in the Silver Crest IPO. Based on the average of the high (US$0.44) and low (US$0.42) prices for the Public Warrants on Nasdaq on March 23, 2022 and pursuant to Amendment No. 1 to the Sponsor Voting and Support Agreement, the value of the Private Warrants outstanding upon the Closing would be $1,913,500.

As a result of the prices at which the Sponsor acquired the Founder Shares and the Private Warrants, and their current value, the Sponsor could make a substantial profit after the completion of the Business Combination even if Silver Crest Public Shareholders lose money on their investments as a result of a decrease in the post-combination value of their Public Shares.

An affiliate of the Sponsor entered into a PIPE Subscription Agreement to commit to subscribe for and purchase 500,000 THIL Ordinary Shares for $10 per share. See the section of this proxy statement/
 
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prospectus titled “Agreements Entered Into in Connection with the Business Combination — PIPE Subscription Agreement” for additional details regarding the PIPE Investment and PIPE Subscription Agreements.

The Sponsor and Silver Crest’s officers and directors and their affiliates are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on Silver Crest’s behalf, such as identifying and investigating possible business targets and business combinations. However, if Silver Crest fails to consummate a business combination within the required period, they will not have any claim against the Trust Account for reimbursement. Accordingly, Silver Crest may not be able to reimburse these expenses if the Business Combination or another business combination is not completed by January 19, 2023 (or such later date as may be approved by Silver Crest’s shareholders in an amendment to the Silver Crest Articles). As of the record date, the Sponsor and Silver Crest’s officers and directors and their affiliates had incurred no unpaid reimbursable expenses.

If Silver Crest is unable to complete a business combination within the required time period, the aggregate dollar amount of non-reimbursable funds would be approximately $     million, reflecting the market value of Founder Shares, the market value of Private Warrants and out-of-pocket unpaid reimbursable expenses.

Silver Crest has provisions in the Silver Crest Articles waiving the corporate opportunities doctrine on an ongoing basis, which means that Silver Crest’s officers and directors have not been obligated and continue to not be obligated to bring all corporate opportunities to Silver Crest.

The Merger Agreement provides for the continued indemnification of Silver Crest’s current directors and officers and the continuation of directors and officers liability insurance covering Silver Crest’s current directors and officers.

Silver Crest’s Sponsor, affiliates of the Sponsor, officers and directors may make loans from time to time to Silver Crest to fund certain capital requirements. On September 28, 2020, the Sponsor agreed to loan Silver Crest an aggregate of up to $300,000 to cover expenses related to the Silver Crest IPO pursuant to a promissory note that was repaid in full on January 22, 2021. Additional loans may be made after the date of this proxy statement/prospectus. If the Business Combination is not consummated, any outstanding loans will not be repaid and will be forgiven except to the extent there are funds available to Silver Crest outside of the Trust Account.

Silver Crest entered into an agreement, commencing January 13, 2021 through the earlier of the consummation of a business combination or its liquidation, to pay the Sponsor a monthly fee of $10,000 for office space, utilities, secretarial and administrative services.

Derek Cheung, currently the Chief Executive Officer and a Director of Silver Crest, will be a member of the board of directors of THIL following the closing of the Business Combination and, therefore, in the future Mr. Cheung will receive cash fees, share options or share-based awards that the board of directors of THIL determines to pay to its non-executive directors.
Q: What equity stake will current THIL shareholders and current Silver Crest shareholders hold in the combined company immediately after the completion of the Business Combination, and what effect will potential sources of dilution have on such equity stake after the Closing?
A: The following table presents the anticipated share ownership of various holders of THIL Ordinary Shares after the completion of the Business Combination, based on the assumption that no additional equity securities of THIL will be issued at or prior to Closing, including to any PIPE investors, and that there are no Dissenting Silver Crest Shareholders, under the following redemption scenarios:

Assuming No Redemptions:   This presentation assumes that no Silver Crest Public Shareholder exercises redemption rights with respect to their Public Shares.

Assuming 50% Redemptions:    This presentation assumes that Silver Crest Public Shareholders holding 15,367,983 Public Shares will exercise their redemption rights for approximately $153.7 million of the $345 million of funds in the Trust Account.

Assuming Maximum Redemptions:    This presentation assumes that Silver Crest Public Shareholders holding 30,735,966 Public Shares will exercise their redemption rights for approximately $307 million
 
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of the $345 million of funds in the Trust Account, which is the maximum number of Public Shares that could be redeemed by Silver Crest Public Shareholders that allows the consummation of the Business Combination, which will not be consummated if, either immediately prior to or upon consummation of the Business Combination, Silver Crest would have net tangible assets of less than $5,000,001 after taking into account the redemption for cash of all Public Shares properly demanded to be redeemed by holders of Public Shares.
Assuming
No Redemptions
Assuming
50% Redemptions
Assuming
Maximum Redemptions(1)
Shares
%
Shares
%
Shares
%
THIL Ordinary Shares:(2)
Existing Silver Crest shareholders(3)
34,500,000 20.86% 19,132,017 12.75% 3,764,034 2.80%
The Sponsor(4)
4,312,500 2.61% 4,312,500 2.88% 4,312,500 3.20%
Existing THIL shareholders(5)
126,555,003 76.53% 126,555,003 84.37% 126,555,003 94.00%
Total THIL Ordinary Shares outstanding at Closing
165,367,503 100.00% 149,999,520 100.00% 134,631,537 100.00%
Per Share Pro Forma Equity Value
of THIL Ordinary Shares
outstanding at
Closing(6)
10.00 10.00 10.00
(1)
Silver Crest’s obligations under the Merger Agreement are subject to certain customary closing conditions. Furthermore, Silver Crest will only proceed with the Business Combination if it will have net tangible assets of at least $5,000,001 upon consummation of the Business Combination (as determined in accordance with Rule3a5l-l(g)(1) of the Exchange Act (or any successor rule)).
(2)
Excluding 14,000,000 Earn-out Shares, THIL Ordinary Shares underlying the Public Warrants and THIL Ordinary Shares underlying the Private Warrants. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-out.”
(3)
Excluding the Sponsor.
(4)
Including 1,400,000 Earn-in Shares that, after the completion of the Business Combination, will be subject to forfeiture relating to the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-in.
(5)
Excluding 7,405,464 shares underlying THIL’s granted share options and restricted share units and 6,039,533 shares underlying THIL’s outstanding convertible notes, which are convertible into fully paid, validly issued and non-assessable THIL Ordinary Shares at a conversion price equal to $11.50 per share at any time on or after the earlier of September 30, 2022 and the Closing (see “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional details).
(6)
In each of the No Redemptions, 50% Redemptions and Maximum Redemptions scenarios, the per share pro forma equity value of THIL Ordinary Shares will be $10.00 at Closing in accordance with the terms of the Merger Agreement.
However, if the actual facts are different than the assumptions laid out above, the anticipated share ownership of various holders of THIL Ordinary Shares after the completion of the Business Combination will be different. THIL shareholders would experience dilution to the extent THIL issues additional shares after Closing, including to any PIPE investors. In addition, the table above excludes certain potential sources of dilution, namely, 7,405,464 shares underlying THIL’s granted share options and restricted share units, the Earn-out Shares, THIL Ordinary Shares to be issued to the PIPE Investors, the Equity Support Shares, the Commitment Shares, the CEF Shares and THIL Ordinary Shares underlying the Public Warrants, the Private Warrants and THIL’s outstanding convertible notes.
The following table presents the anticipated share ownership of various holders of THIL Ordinary Shares after the completion of the Business Combination assuming the issuance of 7,405,464 shares underlying THIL’s granted share options and restricted share units, the Earn-out Shares, THIL Ordinary Shares to be issued to the PIPE Investors, 300,000 Commitment Shares issuable under the CEF Purchase Agreement (assuming that the trading price of THIL Ordinary Shares on the Commitment Shares Determination Date is $10.00 per share), 5,000,000 Equity Support Shares (the maximum number of THIL Ordinary Shares that could be issued under the ESA, assuming that the existing PIPE Investment is fully
 
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funded and that at least 1,100,000 Silver Crest Public Shares are not redeemed) and THIL Ordinary Shares underlying the Public Warrants, the Private Warrants and THIL’s outstanding convertible notes (but not the CEF Shares, which may be issued by THIL from time to time at its option after the CEF Initial Resale Registration Statement becomes effective under the Securities Act and other conditions under the CEF Purchase Agreement are met), assuming that no additional equity securities of THIL will be issued at or prior to Closing, including to any PIPE investors, and that there are no Dissenting Silver Crest Shareholders, under the following redemption scenarios:
Assuming
No Redemptions
Assuming
50% Redemptions
Assuming
Maximum Redemptions(1)
Shares
%
Shares
%
Shares
%
Total THIL Ordinary Shares outstanding at Closing
165,367,503 73.15% 149,999,520 71.19% 134,631,537 68.93%
Potential sources of dilution:
Shares underlying granted option
shares and restricted shares
7,405,464 3.29% 7,405,464 3.51% 7,405,464 3.79%
Earn-out shares(1)
14,000,000 6.19% 14,000,000 6.64% 14,000,000 7.17%
Shares underlying Public Warrants(2)
17,250,000 7.63% 17,250,000 8.19% 17,250,000 8.83%
Shares underlying Private Warrants(3)
4,450,000 1.97% 4,450,000 2.12% 4,450,000 2.28%
Shares underlying the Notes(4)
6,039,533 2.67% 6,039,533 2.87% 6,039,533 3.09%
Shares underlying PIPE Investment(5)
5,750,000 2.54% 5,750,000 2.73% 5,750,000 2.94%
Sponsor PIPE Shares(10)
500,000 0.22% 500,000 0.24% 500,000 0.26%
Equity Support Shares(11)
5,000,000 2.21% 5,000,000 2.37% 5,000,000 2.56%
Commitment Shares(12)
300,000 0.13% 300,000 0.14% 300,000 0.15%
Total THIL Ordinary Shares
outstanding at Closing (including
shares underlying granted option
shares and restricted shares,
earn-out shares, PIPE shares,
shares underlying warrants and
shares underlying the Notes)
226,062,500
100.00%
210,694,517
100.00%
195,326,534
100.00%
Holders of THIL Ordinary Shares
reflecting potential sources of
dilution:
Existing Silver Crest shareholders(6)
51,750,000 22.89% 36,382,017 17.27% 21,014,034 10.76%
The Sponsor(7)
9,262,500 4.10% 9,262,500 4.40% 9,262,500 4.75%
Existing THIL shareholders(8)
147,960,467 65.46% 147,960,467 70.22% 147,960,467 75.75%
Holders of the Notes(4)
6,039,533 2.67% 6,039,533 2.87% 6,039,533 3.09%
PIPE Investors(5)
5,750,000 2.54% 5,750,000 2.73% 5,750,000 2.94%
ESA Investors(11)
5,000,000 2.21% 5,000,000 2.37% 5,000,000 2.56%
Cantor(12) 300,000 0.13% 300,000 0.14% 300,000 0.15%
(1)
After the completion of the Business Combination, existing THIL shareholders prior to the completion of the Business Combination will receive the right to receive, in the aggregate, 14,000,000 additional THIL Ordinary Shares, contingent upon the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-out.
(2)
The Public Warrants are redeemable warrants issued in the Silver Crest IPO, each entitling its holder to purchase one Silver Crest Class A Share at an exercise price of $11.50 per share, subject to adjustment. In connection with the Business Combination, such warrants will be automatically and irrevocably assumed by THIL and converted into a corresponding warrant exercisable for THIL Ordinary Shares. Based on the average of the high (US$0.44) and low (US$0.42) prices for the Public Warrants on Nasdaq on March 23, 2022, the value of the total outstanding Public Warrants would be $7,417,500.
 
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(3)
The Private Warrants are warrants sold to Sponsor in the private placement consummated concurrently with the Silver Crest IPO, each entitling its holder to purchase one Silver Crest Class A Share at an exercise price of $11.50 per share, subject to adjustment. In connection with the Business Combination, such warrants will be automatically and irrevocably assumed by THIL and converted into a corresponding warrant exercisable for THIL Ordinary Shares. Based on the average of the high (US$0.44) and low (US$0.42) prices for the Public Warrants on Nasdaq on March 23, 2022 and pursuant to Amendment No. 1 to the Sponsor Voting and Support Agreement, the value of the Private Warrants outstanding upon the Closing would be $1,913,500. In the event that, following consummation of the Business Combination, the Sponsor exercises the Private Warrants, the ownership of non-redeeming Silver Crest Public Shareholders in THIL would be diluted due to the issuance of THIL Ordinary Shares underlying such Private Warrants to the Sponsor.
(4)
Representing THIL Ordinary Shares underlying THIL’s outstanding convertible notes, which are convertible into fully paid, validly issued and non-assessable THIL Ordinary Shares at a conversion price equal to $11.50 per share at any time on or after the earlier of September 30, 2022 and the Closing (see “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional details).
(5)
Representing the aggregate of 4,550,000 THIL Ordinary Shares and 1,200,000 THIL Warrants to be issued to certain shareholders of Pangaea Two Acquisition Holdings XXIIB Limited and THIL, an affiliate of Cartesian Capital Group, LLC and a holder of the Notes (as defined below), of which 600,000 THIL Ordinary Shares and 1,200,000 THIL Warrants will be issued for no consideration to the investors that agree to pay a purchase price of at least $10,000,000, and excluding 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL. See “Agreements Entered into in Connection with the Business Combination — PIPE Subscription Agreements” and “Beneficial Ownership of Securities” for additional details.
(6)
Excluding the Sponsor and including 17,250,000 THIL Ordinary Shares underlying Public Warrants.
(7)
Including 4,450,000 THIL Ordinary Shares underlying Private Warrants, 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL, and 1.4 million Earn-in Shares that, after the completion of the Business Combination, will be subject to forfeiture relating to the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-in.
(8)
Including 7,405,464 shares underlying THIL’s granted share options and restricted share units and 14,000,000 Earn-out Shares and excluding 6,039,533 shares underlying THIL’s outstanding convertible notes.
(9)
In each of the No Redemptions, 50% Redemptions and Maximum Redemptions scenarios, the per share pro forma equity value of THIL Ordinary Shares will be $10.00 at Closing in accordance with the terms of the Merger Agreement.
(10)
Representing the 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL. See “Agreements Entered into in Connection with the Business Combination — PIPE Subscription Agreements” and “Beneficial Ownership of Securities” for additional details.
(11)
Representing the maximum amount of THIL Ordinary Shares that could be issued to certain third-party investors under the ESA upon the Closing, assuming that the existing PIPE Investment is fully funded and that at least 1,100,000 Silver Crest Public Shares are not redeemed. See “Summary — Recent Development — Equity Support Agreement” for additional details.
(12)
Representing the amount of THIL Ordinary Shares issuable to CF Principal Investments LLC under the CEF Purchase Agreement after the Closing and before the filing of the CEF Initial Resale Registration Statement, assuming that the trading price of THIL Ordinary Shares on the Commitment Shares Determination Date is $10.00 per share. See “Summary — Recent Development — Committed Equity Facility” for additional details.
This information should be read together with the pro forma combined financial information in the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.”
Q: Why did Silver Crest and THIL agree to a change to the base enterprise valuation of THIL and how does such agreement affect Silver Crest Public Shareholders and the Sponsor?
A: On March 9, 2022, Silver Crest, THIL and Merger Sub entered into Amendment No. 2 to the Merger Agreement, which amended the terms of the Merger Agreement to, among other things, reduce the base enterprise valuation of THIL from $1,688,000,000 to $1,400,000,000 in light of the recent market development (during the period following the execution of the Merger Agreement, equity markets have weakened globally and market receptivity for mergers of special purpose acquisition companies, or SPACs, also weakened, as shown by the increase in redemption rates).
On the Closing Date, THIL will, among other things, effect a share split of each THIL Pre-Split Ordinary Share into such number of THIL Ordinary Shares based on the equity value of THIL (which will be based on a base enterprise valuation of THIL of $1,400,000,000 and certain adjustments thereto as set forth in the Merger Agreement) and calculated in accordance with the terms of the Merger Agreement. See the section of this proxy statement/prospectus titled “Proposal One — The Business Combination Proposal — Merger Consideration.
In accordance with the terms of the Merger Agreement, the reduction of the base enterprise valuation of THIL from $1,688,000,000 to $1,400,000,000 reduces the number of THIL Ordinary Shares that will
 
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result from and be outstanding following the share split described above, which consequently decreases the anticipated share ownership attributable to existing THIL shareholders upon the Closing and increases the anticipated share ownership attributable to Silver Crest Public Shareholders and the Sponsor upon the completion of the Business Combination.
For illustration purposes, the following table compares the anticipated share ownership of Silver Crest Public Shareholders, the Sponsor and existing THIL shareholders after the completion of the Business Combination under two base enterprise valuations of THIL, the original base enterprise valuation of $1,688,000,000 and the amended base enterprise valuation of $1,400,000,000, in each case based on certain assumptions as described below.
Anticipated Share Ownership After Completion of the Business Combination(1)
Base Enterprise Valuation of THIL
$1,688,000,000 (Original)
$1,400,000,000 (Amended)
THIL Ordinary Shares:(2)
Silver Crest Public Shareholders
34,500,000 16.62% 34,500,000 19.29%
The Sponsor(3)
4,312,500 2.08% 4,312,500 2.41%
Existing THIL shareholders(4)
168,800,000 81.30% 140,000,000 78.30%
Total THIL Ordinary Shares outstanding at
Closing
207,612,500 100.00% 178,812,500 100.00%
(1)
Assuming that no additional equity securities of THIL will be issued at or prior to Closing (including to any PIPE investors), no Silver Crest Public Shareholder exercises redemption rights with respect to their Public Shares, no share is underlying THIL’s granted share options and restricted share units, no share is underlying THIL’s outstanding convertible notes, and that there are no Dissenting Silver Crest Shareholders.
(2)
Excluding 14,000,000 Earn-out Shares, THIL Ordinary Shares underlying the Public Warrants, THIL Ordinary Shares underlying the Private Warrants and any THIL Ordinary Share to be issued in connection with the PIPE Investment. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-out.
(3)
Including 1,400,000 Earn-in Shares that, after the completion of the Business Combination, will be subject to forfeiture relating to the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-in.
(4)
Assuming that no share is underlying THIL’s granted share options and restricted share units and no share is underlying THIL’s outstanding convertible notes (see “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional details).
Q: What is the effective underwriting fee that will be received by the underwriter for the Silver Crest IPO?
A: Irrespective of the amount of redemptions by Silver Crest Public Shareholders, THIL will pay the underwriter for the Silver Crest IPO $12,075,000 (RMB 77,963,445) of deferred underwriting commissions upon consummation of the Business Combination). Although this amount of deferred underwriting commissions is fixed, the level of redemptions will impact the effective underwriting fee incurred in connection with the Silver Crest IPO:

Assuming No Redemptions:   The underwriter for the Silver Crest IPO will receive deferred commissions of $0.073 per THIL Ordinary Share outstanding at Closing. Based on the approximately $345 million in the trust account as of December 31, 2021, the approximately $12,075,000 of deferred underwriting commissions would represent an effective underwriting fee of approximately 3.5%.

Assuming 50% Redemptions:   The underwriter for the Silver Crest IPO will receive deferred commissions of $0.080 per THIL Ordinary Share outstanding at Closing. Assuming that Silver Crest Public Shareholders holding 15,367,983 Public Shares will exercise their redemption rights for
 
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approximately $153.7 million of the $345 million of funds in the Trust Account, the funds remaining in the Trust Account following such redemption would be approximately $191.3 million and the effective underwriting fee would be approximately 6.31%.

Assuming Maximum Redemptions:   The underwriter for the Silver Crest IPO will receive deferred commissions of $0.090 per THIL Ordinary Share outstanding at Closing. Assuming that Silver Crest Public Shareholders holding 30,735,966 Public Shares will exercise their redemption rights for approximately $307 million of the $345 million of funds in the Trust Account, the funds remaining in the trust account following such redemption would be approximately $37.6 million and the effective underwriting fee would be approximately 32.1%.
Q: When do you expect the Business Combination to be completed?
A: It is currently anticipated that the Business Combination will be consummated promptly following the Silver Crest extraordinary general meeting, which is set for                 , 2022; however, such meeting could be adjourned or postponed to a later date, as described above. The Closing is also subject to other customary closing conditions. For a description of the conditions for the completion of the Business Combination, see the section entitled “The Merger Agreement and Ancillary Documents — Conditions to Closing.”
Q: What do I need to do now?
A: Silver Crest urges you to carefully read and consider the information contained in this proxy statement/prospectus, including the annexes, and to consider how the Business Combination will affect you as a shareholder of Silver Crest. Shareholders should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus and on the enclosed proxy card.
Q: When and where will the extraordinary general meeting take place?
A: The extraordinary general meeting will be held on                 , 2022, at                 a.m., Eastern Time, at                 and virtually over the Internet by means of a live audio webcast. You may attend the extraordinary general meeting webcast by accessing the web portal located at https://                 and following the instructions set forth below. We encourage shareholders to attend the extraordinary general meeting virtually via the live webcast. In order to maintain the interactive nature of the extraordinary general meeting, virtual attendees who have registered for the meeting and entered a valid control number will be able to:

vote via the web portal during the extraordinary general meeting webcast; and

submit questions to the chairman during the extraordinary general meeting.
Shareholders who have registered for the meeting and entered a valid control number may submit questions to the chairman during the meeting through the extraordinary general meeting webcast by typing in the “Submit a question” box.
A separate conference line to allow participants to communicate with each other during the extraordinary general meeting will also be made available.
Q: How do I attend the extraordinary general meeting?
A: Due to health concerns stemming from the COVID-19 pandemic and to support the health and well-being of Silver Crest’s shareholders, you are encouraged to attend the extraordinary general meeting virtually. To register for and attend the extraordinary general meeting virtually, please follow these instructions as applicable to the nature of your ownership of Silver Crest Ordinary Shares:

Shares Held of Record.   If you are a record holder, and you wish to attend the extraordinary general meeting virtually, go to https://                 , enter the control number you received on your proxy card or notice of the meeting and click on the “Click here to register for the online meeting” link at the top of the page. Immediately prior to the start of the extraordinary general meeting, you will need to log back into the meeting site using your control number.
 
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Shares Held in Street Name.   If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or nominee, and you wish to attend the extraordinary general meeting virtually, you must obtain a legal proxy from the shareholder of record and e-mail a copy (a legible photograph is sufficient) of your proxy to proxy@continentalstock.com no later than 72 hours prior to the extraordinary general meeting. Holders should contact their broker, bank or nominee for instructions regarding obtaining a proxy. Holders who e-mail a valid legal proxy will be issued a meeting control number that will allow them to register to attend and participate in the extraordinary general meeting. You will receive an e-mail prior to the meeting with a link and instructions for entering the extraordinary general meeting. “Street name” holders should contact Continental Stock Transfer & Trust Company on or before                 , 2022.
Shareholders will also have the option to listen to the extraordinary general meeting by telephone by calling:

Within the U.S. and Canada: (                 )                 (toll-free)

Outside of the U.S. and Canada: (                 )                 (standard rates apply)
The passcode for telephone access:                 #. You will not be able to vote or submit questions unless you register for and log in to the extraordinary general meeting webcast as described above.
Q: How do I vote?
A: If you are a holder of record of Silver Crest Ordinary Shares at the close of business on the record date, you may vote by (a) attending the extraordinary general meeting and voting in person, including virtually over the Internet by joining the live audio webcast and voting electronically by submitting a ballot through the web portal during the extraordinary general meeting webcast or (b) by submitting a proxy for the extraordinary general meeting. You may submit your proxy by completing, signing, dating and returning the enclosed proxy card in the accompanying pre-addressed postage paid envelope so that it is received no later than 48 hours before the time appointed for the holding of the extraordinary general meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting). By signing the proxy card and returning it, you are authorizing the individuals named on the proxy card to vote your shares at the extraordinary general meeting in the manner you indicate. If you hold your shares in “street name,” you should contact your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly voted and counted. In this regard, you must provide the broker, bank or nominee with instructions on how to vote your shares or, if you wish to attend the extraordinary general meeting virtually, and vote through the web portal, obtain a legal proxy from your broker, bank or nominee.
Q: If my shares are held in “street name,” will my broker, bank or nominee automatically vote my shares for me?
A: Your broker, bank or nominee can vote your shares without receiving your instructions on “routine” proposals only. Your broker, bank or nominee cannot vote your shares with respect to “non-routine” proposals unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank or nominee.
The Business Combination Proposal, the Merger Proposal and the Adjournment Proposal are non-routine proposals. Accordingly, your broker, bank or nominee may not vote your shares with respect to these proposals unless you provide voting instructions.
Q: May I change my vote after I have mailed my signed proxy card?
A: Yes. Shareholders of record may send a later-dated, signed proxy card to Silver Crest’s transfer agent at the address set forth below so that it is received no later than 48 hours before the time appointed for the holding of the extraordinary general meeting (or, in the case of an adjournment, no later than 48 hours before the time appointed for the holding of the adjourned meeting) or attend the extraordinary general meeting and vote in person, including virtually over the Internet by joining the live audio webcast and voting electronically by submitting a ballot through the web portal during the extraordinary general meeting
 
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webcast. Shareholders of record also may revoke their proxy by sending a notice of revocation to Silver Crest’s board of directors, which must be received prior to the vote at the extraordinary general meeting. If you hold your shares in “street name,” you should contact your broker, bank or nominee to change your instructions on how to vote. If you hold your shares in “street name” and wish to virtually attend the extraordinary general meeting and vote through the web portal, you must obtain a legal proxy from your broker, bank or nominee.
Q: What constitutes a quorum for the extraordinary general meeting?
A: A quorum is the minimum number of Silver Crest Ordinary Shares that must be present to hold a valid meeting. A quorum will be present at the Silver Crest extraordinary general meeting if one or more shareholders holding a majority of the issued and outstanding Silver Crest Ordinary Shares entitled to vote at the meeting are represented at the extraordinary general meeting in person or by proxy. Abstentions and broker non-votes will count as present for the purposes of establishing a quorum. As of the record date,         Silver Crest Ordinary Shares would be required to achieve a quorum.
Q: What shareholder vote thresholds are required for the approval of each proposal brought before the extraordinary general meeting?

Business Combination Proposal — The approval of the Business Combination Proposal will require an ordinary resolution under Cayman Islands law and pursuant to the Silver Crest Articles, being the affirmative vote of shareholders holding a majority of the Silver Crest Ordinary Shares which are voted on such resolution in person or by proxy at the extraordinary general meeting at which a quorum is present. The Transactions will not be consummated if Silver Crest has less than $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) either immediately prior to or upon consummation of the Transactions.

Merger Proposal — The approval of the Merger Proposal will require a special resolution under Cayman Islands law and pursuant to the Silver Crest Articles, being the affirmative vote of shareholders holding at least two thirds of the Silver Crest Ordinary Shares which are voted on such resolution in person or by proxy at the extraordinary general meeting at which quorum is present.

Adjournment Proposal — The approval of the Adjournment Proposal will require an ordinary resolution under Cayman Islands law and pursuant to the Silver Crest Articles, being the affirmative vote of shareholders holding a majority of the Silver Crest Ordinary Shares which are voted on such resolution in person or by proxy at the extraordinary general meeting at which a quorum is present.
The Silver Crest Class A Shares and Silver Crest Class B Shares are entitled to vote together as a single class on all matters to be considered at the extraordinary general meeting. Voting on all resolutions at the extraordinary general meeting will be conducted by way of a poll vote. Shareholders will have one vote for each Silver Crest Ordinary Share owned at the close of business on the record date.
Brokers are not entitled to vote on the Business Combination Proposal, the Merger Proposal or the Adjournment Proposal absent voting instructions from the beneficial holder. Abstentions and broker non-votes, while considered present for the purposes of establishing a quorum, will not count as votes cast at the extraordinary general meeting, and otherwise will have no effect on a particular proposal.
Q: What happens if I fail to take any action with respect to the extraordinary general meeting?
A: If you fail to take any action with respect to the extraordinary general meeting and fail to redeem your Public Shares following the procedure described in this proxy statement/prospectus and the Business Combination is approved by the Silver Crest shareholders and consummated, you will become a shareholder of THIL.
If you fail to take any action with respect to the extraordinary general meeting and the Business Combination is not approved, you will continue to be a shareholder of Silver Crest, as applicable, and Silver Crest will continue to search for another target business with which to complete an initial business combination. If Silver Crest does not complete an initial business combination by January 19, 2023 (or such
 
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later date as may be approved by Silver Crest’s shareholders in an amendment to the Silver Crest Articles), Silver Crest must cease all operations except for the purpose of winding up, redeem 100% of the outstanding Public Shares, at a per-share price, payable in cash, equal to an amount then held in the Trust Account (net of taxes payable and less up to $100,000 of interest to pay dissolution expenses), and as promptly as reasonably possible following such redemption, subject to the approval of Silver Crest’s remaining shareholders and its board of directors, dissolve and liquidate.
Q: What should I do with my share certificates?
A: Shareholders who do not elect to have their Silver Crest Ordinary Shares redeemed for a pro rata share of the Trust Account should wait for instructions from Silver Crest’s transfer agent regarding what to do with their certificates.
Silver Crest Public Shareholders who elect to exercise their redemption rights must either tender their share certificates (if any) to Silver Crest’s transfer agent or deliver their Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC System, in each case no later than two (2) business days prior to the extraordinary general meeting as described above.
Q: What should I do if I receive more than one set of voting materials?
A: Shareholders 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 a vote with respect to all of your Silver Crest Ordinary Shares.
Q: Who can help answer my questions?
A: If you have questions about the Business Combination or if you need additional copies of this proxy statement/prospectus or the enclosed proxy card, you should contact Silver Crest’s proxy solicitor at:
D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Banks and Brokers may call: (212) 269-5550
Shareholders may call toll free: (800) 967-7635
SLCR@dfking.com
You may also obtain additional information about Silver Crest from documents filed with the SEC by following the instructions in the section entitled “Where You Can Find More Information.” If you are a Silver Crest Public Shareholder and you intend to seek redemption of your shares, you will need to either tender your share certificates (if any) to Silver Crest’s transfer agent at the address below or deliver your Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC System, in each case at least two (2) business days prior to the extraordinary general meeting. If you have questions regarding the certification of your position or delivery of your share certificates and redemption request, please contact:
Continental Stock Transfer & Trust Company
1 State Street — 30th Floor
New York, New York 10004
Attn: Compliance Department
Email: Proxy@continentalstock.com
 
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SUMMARY
This summary highlights selected information from this proxy statement/prospectus. It may not contain all of the information that is important to you. You should carefully read the entire proxy statement/prospectus and the other documents referred to in this proxy statement/prospectus, including the annexes, to fully understand the Merger Agreement, the Business Combination and the other matters being considered at the extraordinary general meeting of Silver Crest shareholders. For additional information, see “Where You Can Find More Information” on page 242. Each item in this summary refers to the page of this proxy statement/prospectus on which that subject is discussed in more detail.
The Parties to the Business Combination
TH International Limited
THIL’s Business
THIL is an emerging coffee champion in China. THIL’s vision is as simple as it is ambitious: to build the premier coffee and bake shop in mainland China. Founded by affiliates of Cartesian Capital Group, LLC (“Cartesian”) and Tim Hortons Restaurants International GmbH, the owner of the Tim Hortons brand, THIL is the parent company of the master franchisee of, and holds the right to operate, Tim Hortons coffee shops in mainland China, Hong Kong and Macau. Tim Hortons, one of the largest coffee, donut, and tea restaurant chains in the world, is deeply rooted in core values of inclusivity and community. THIL opened its first coffee shop in China in February 2019 and has grown dramatically since then, selling high-quality coffee and freshly prepared food items at attractive price points through both company owned and operated stores and franchised stores. As of December 31, 2021, THIL had 390 system-wide stores across 21 cities in mainland China. As of the date of this proxy statement/prospectus, THIL does not have any stores outside of mainland China. In addition to its physical store network, THIL has built a rapidly expanding base of loyal customers and a robust technology infrastructure that facilitates digital ordering and supports the efficient growth of its business. In 2021, digital orders, including both delivery and mobile ordering for self pick-up, accounted for approximately 73.0% of THIL’s revenues from company owned and operated stores, representing an increase of 8.8 percentage points from approximately 64.2% in 2020. It also has a popular loyalty program. As of December 31, 2021, THIL had registered members of approximately 6.0 million, representing an increase of 154.7% from 2.3 million as of December 31, 2020. In February 2022, Tim Hortons China transferred control and possession of the personal data of THIL’s customers to Pangaea Data Tech (Shanghai) Co., Ltd. (the “DataCo”), a PRC-incorporated company, pursuant to a Business Cooperation Agreement. For a more detailed description, see the section of this proxy statement/prospectus titled “THIL’s Business — Digital Technology and Information Systems.
THIL provides customers with a distinctive value proposition, combining freshly prepared, high-quality and locally relevant food and beverages, priced attractively and served to its guests with an inviting customer experience. THIL’s business philosophy is anchored by four fundamental cornerstones: true local relevance, continuous innovation, genuine community, and absolute convenience, and THIL seeks to deliver these through world-class execution and data-driven decision making.

True local relevance:   As a global brand, THIL strives to understand and embrace what its guests like, want and need. True localization is evident in its menu, store designs and digital identity, allowing it to create familiarity and grow rapidly in the Chinese market.

Continuous innovation:   In China’s dynamic and demanding consumer market, THIL bolsters its strong core menu offering by continually updating its product offerings and innovating on its digital systems from customer facing elements like ordering to back-of-the-house systems like training and supply chain.

Genuine community:   THIL is not just about caffeine but also connections. THIL’s physical and digital spaces allow its community to interact around its products, and its loyalty club offers incentives and discounts to build the community and drive sales.

Absolute convenience:   THIL strives to make buying its products as simple and convenient as possible for guests. Towards this goal, THIL (i) strategically deploys three complementary store
 
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formats, namely flagship stores, classic stores and “Tims Go” stores, (ii) leverages mobile ordering to streamline the customer experience, and (iii) utilizes delivery to increase its reach and efficiency.
Building on these four cornerstones, THIL’s revenue has grown rapidly since its inception, and THIL has maintained positive adjusted store EBITDA for its company owned and operated stores for 2020 and 2021. The fully-burdened gross profit of THIL’s company owned and operated stores, the most comparable GAAP measure to adjusted store EBITDA, for 2020 and 2021 was negative RMB46.3 million and negative RMB157.4 million (US$24.8 million), respectively. During the same periods, THIL’s adjusted store EBITDA was RMB13.5 million and RMB27.5 million (US$4.3 million), respectively. For more details regarding adjusted store EBITDA, a non-GAAP financial measure, which is a key measure used by THIL’s management and board of directors in evaluating THIL’s operating performance and making strategic decisions regarding capital allocation, see “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Non-GAAP Financial Measure.” THIL’s revenues grew significantly from RMB57.3 million in 2019 to RMB212.1 million in 2020, and further grew to RMB643.4 million (US$101.3 million) in 2021. Its total costs and expenses increased from RMB148.5 million in 2019 to RMB353.3 million in 2020, and further increased to RMB1,017.8 million (US$160.2 million) in 2021. Its net loss increased from RMB87.8 million in 2019 to RMB143.1 million in 2020, and further increased to RMB382.9 million (US$60.3 million) in 2021.
Impact of COVID-19
THIL has demonstrated resilience and agility throughout the COVID-19 pandemic, but serious challenges endure. The COVID-19 pandemic has adversely affected THIL’s store operations and the sales of affected stores since 2020, primarily as a result of temporary store closures, reduced operating hours and decreased customer traffic. In late January and February 2020, its total sales dropped by approximately 20%-30% compared to pre-COVID levels. Its total sales began to gradually recover in March 2020, almost reaching pre-COVID levels by the end of June 2020. During the first half of 2020, home delivery of its products was very strong, which partially offset the impact from COVID-19. In late 2020, THIL’s dine-in business was again negatively affected for a brief period due to a moderate resurgence of COVID-19 cases. Beginning in March 2022, the outbreak of the Omicron variant of COVID-19 and the zero-COVID measures, such as lengthy city-wide lock-downs, undertaken in certain cities in which THIL’s PRC subsidiaries operate (including Shanghai, where we have the highest number of stores), have caused significant disruptions to the operations of THIL’s PRC Subsidiaries in these cities, such as temporary closure of certain stores as a result of the lock-downs imposed in these cities, restrictions on delivery services in locked-down areas, shortage of production, service and delivery staff, slower pace of store network expansion, and volatility in the supply and price of raw materials and intermediary products. During this period, THIL continued to offer home-delivery services through group buying and e-commerce sales to the extent permitted, which mitigated the impact of the disruptions to some extent and enabled us to further expand our customer base. In addition, the COVID-19 pandemic has had an adverse impact on the global and local supply chain. For a more detailed discussion, see “— Inflation and Supply Chain Impacts.” Despite the challenges posed by COVID-19, its disruptive impact on other retail groups also provided an opportunity to access many attractive sites and expand rapidly. Overall, THIL believes that the impact of COVID-19 on its business is manageable. The revenues of THIL’s company owned and operated stores have continued to grow on a year-over-year basis since 2020, and the same-store sales growth of its company owned and operated stores was 7.4%, 15.7%, and 3.4% in 2020, 2021 and the first quarter of 2022, respectively. As the pandemic continues to rapidly evolve in China around the world, with several new COVID-19 variants continuing to be discovered, THIL is continuously assessing the impact of COVID-19 on its business operations and financial condition. While the rate of THIL’s same-store sales growth may continue to be adversely impacted by the COVID-19 pandemic and related public health measures, such as lock-downs, until such measures are largely relaxed or lifted, it cannot anticipate with certainty the length or severity of such impact. As of the date of this proxy statement/prospectus, the lock-downs in Shanghai and certain other cities in mainland China have eased to some extent.
Inflation and Supply Chain Impacts
In addition to the COVID-19 pandemic and related control measures, rising inflation, geopolitical conflicts, including the recent war in Ukraine, and the related supply chain disruptions have also had a direct or indirect impact on THIL’s business, customer base, results of operations, profit margins and outlook.
 
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Increases in the inflation rate of prices of commodities that are inputs to THIL’s products and services, such as agricultural and energy commodities, have led to higher raw material, fuel, freight, warehousing and labor costs and operating expenses. The unit purchase prices of THIL’s regionally sourced raw materials and other products, such as dairy, bakery and food ingredients and packing materials, have remained relatively stable, while the unit price of THIL’s coffee beans has continued to increase since its inception and was approximately 16.6% higher in January 2022 than January 2021. THIL has also enjoyed favorable discounts as its store network and procurement volume continue to grow. THIL anticipates that the average unit price of imported coffee beans will continue to increase in the foreseeable future and that continued inflationary pressure will continue to pressure its margins. Increased inflation rates could also cause discretionary purchases to decline and adversely affect THIL’s ability to attract and retain customers and encourage customer spending. In addition, if the disposable income of THIL’s customers does not increase at a similar rate as inflation does, its sales could suffer, which could materially and adversely affect its business and financial condition and cause it to have additional working capital needs. However, THIL cannot predict whether or how long these higher inflation rates will persist. For a more detailed disclosure on the related risks, see “Risk Factors — Risks Related to THIL’s Business and Industry — We face risks related to the fluctuations in the cost, availability and quality of our raw materials and other products, as well as third-party data maintenance and management services, technical support and consulting services, which could adversely affect our results of operations” and “Risk Factors — Risks Related to Doing Business in China — Changes in China’s economic, political or social conditions or government policies could have a material adverse effect on our business and operations.
In addition, although THIL does not have any operations outside of mainland China or any business relationships, connections to, or assets in, Russia, Belarus, or Ukraine, its business, financial condition and results of operations have been, and could continue to be, indirectly and adversely affected by the ongoing military conflict between Russia and Ukraine. Such impact arises from: (i) volatility in the global supply of wheat, corn, barley, sunflower oil and other agricultural commodities; (ii) higher food prices due to supply constraints and the general inflationary impact of the war; (iii) increases in energy prices globally, in particular for electricity and fossil fuels such as crude oil and natural gas, and related transportation, freight and warehousing costs; and (iv) disruptions to logistics and supply chains. See “Risk Factors — Risks Related to THIL’s Business and Industry — We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine. Our business, financial condition and results of operations may be materially and adversely affected by any negative impact on the global economy and capital markets resulting from the conflict in Ukraine or any other geopolitical tensions.
The impact on THIL’s supply chains from rising inflation and geopolitical tensions primarily consists of: (i) higher purchase prices and fuel, freight and warehousing costs for both imported and regionally sourced raw materials and other products, (ii) delays in the manufacturing, processing and transportation of raw materials and other products; and (iii) logistics and operational disruptions. In addition, the COVID-19 pandemic has had an adverse impact on the global and local supply chain. Specifically, (i) the COVID-19 pandemic has resulted in disruptions to the operations of the supplier of THIL’s coffee beans, all of which are imported from the United States, and delays in the transportation of coffee beans from the United States to China; (ii) measures taken by the PRC government to contain the spread of COVID-19, such as lock-downs and travel restrictions, have caused temporary supply shortages or unstable supplies of certain raw materials and other products, longer lead times, and increased transportation, freight and warehousing costs during the implementation of these measures. As many of THIL’s coffee condiments and pre-made products have a relatively short shelf life, the lack of availability of these products that meet THIL’s or THRI’s quality standards or timing requirements could have a material adverse impact on its business, financial condition and results of operations. The magnitude of such impact is difficult to predict, in part because it closely hinges on the outbreaks of COVID-19 and related measures, which are highly unpredictable. Future interruptions or friction in THIL’s supply chains, as well as anticipation of interruptions or friction, may cause it to be unable to meet customer demand, retain extra inventory and make operational plans with less precision. Each of these impacts, if THIL is affected more than its competitors, could materially and adversely affect its business, adversely impact its prices and/or margins, and cause it to have additional working capital needs.
 
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The increases in THIL’s costs and expenses described above have been mitigated to some extent by its growing economies of scale and operating efficiency as it continues to expand its store network and grow its business. As a result of favorable discounts granted in connection with bulk purchases of regionally sourced food ingredients and pre-made products, the profit margins for THIL’s food products have remained relatively stable.
Towards the goal of further mitigating the pressure on THIL’s overall cost structure as a result of price inflation, geopolitical tensions and additional costs and expenses associated with supply chain disruptions, since January 2022, THIL has raised the list price of its beverage products, including coffees, by RMB1 to RMB2 per cup (or approximately 5-8% of the list price) and reduced the rate of its promotional discounts by 3-5%. As a result of these mitigation efforts, THIL’s profit margins for these beverage products also have remained relatively stable. However, if the costs and expenses described above continue to increase, there can be no assurance that THIL can continue to increase prices to maintain its margins. Lower margins could adversely impact the profitability of THIL’s business and adversely impact its share price and prospects. If the amounts THIL charges its customers increase at a rate that is either unaffordable to its customers or insufficient to compensate for the rise in its material costs and operational expenses, its business may be materially and adversely affected, its product margin may deteriorate and it may have additional working capital needs. THIL does not believe that such mitigation efforts have introduced any other new material risks, including but not limited to, those related to product quality or reliability or regulatory approval. For a more detailed discussion of the related risks, see “Risk Factors — Risks Related to THIL’s Business and Industry — If we are unable to maintain or increase prices, we may fail to maintain a positive margin.” In order to mitigate the potential adverse impact of price increases on its financial condition and results of operations, THIL plans to continue to improve its operating efficiency and further strengthen its bargaining power with its suppliers through the continued expansion of its store network.
Corporate Structure
THIL is a Cayman Islands holding company that conducts its operations in mainland China through wholly owned subsidiaries and does not directly own any substantive business operations in mainland China. Therefore, investors in THIL will not directly hold any equity interests in its operating companies. This holding company structure involves unique risks to investors. For example, PRC regulatory authorities could disallow this operating structure and limit or hinder THIL’s ability to conduct its business through, receive dividends from or transfer funds to its operating subsidiaries or list on a U.S. or other foreign exchange, which could cause the value of THIL’s securities to significantly decline or become worthless. See “Risk Factors — Risks Related to Doing Business in China” for more details.
The following diagram illustrates THIL’s corporate structure immediately after the completion of the Business Combination, assuming the PIPE Investment (as defined below) is fully funded at the Closing and excluding (i) shares reserved for THIL’s granted share options and restricted share units subject to vesting,
 
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(ii) the “Earn-out” Shares, (iii) the Equity Support Shares, CEF Shares and Commitment Shares (as defined below) and (iv) shares underlying the warrants issued in Silver Crest’s initial public offering and THIL’s outstanding convertible notes:
[MISSING IMAGE: tm2125996d24-fc_corporate4c.jpg]
On December 2, 2021, Tim Hortons China entered into a Business Cooperation Agreement with DataCo, the terms of which are set forth below:

Tim Hortons China will assign, convey and transfer, and shall cause its affiliates to assign, convey and transfer, to DataCo all rights, title and interests in and to (a) all personal data of customers in mainland China that is used, or held for use, in the operation of the loyalty program, (b) all intellectual property in and to such data, (c) all tangible embodiments of such data in any form and in any media and all records and documentation relating thereto, (d) copies of any of the foregoing, and (e) all other aggregated, processed or other data arising from DataCo’s performance of the services under the Agreement and all intellectual property therein (collectively, “TH China Data”), which was completed in February 2022;

Data Co will provide Tim Hortons China with various data maintenance and management services, technical support and consulting services (collectively, the “Services”) in support of the operation of the loyalty program;

In consideration for the Services, Tim Hortons China shall pay a service fee to DataCo on an annual basis (or at any time agreed by the parties), which shall be reasonably determined by DataCo based on (i) the complexity and difficulty of the Services, (ii) the seniority of and time consumed by the employees of DataCo providing the Services; (iii) the specific contents, scope and value of the Services; and (iv) the market price for services similar to the Services; and

DataCo will grant to Tim Hortons China a non-exclusive, non-assignable, generally non- sublicensable, fully paid-up and royalty-free license to access, use, reproduce, modify and prepare
 
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derivative works based upon TH China Data, solely on an aggregated or de-identified basis and solely for purposes of the operation of the loyalty program in mainland China.
Based on the opinion of THIL’s PRC counsel, Han Kun Law Offices, according to its interpretation of the currently in-effect PRC laws and regulations, THIL believes that neither THIL nor any of its PRC Subsidiaries is subject to cybersecurity review, reporting or other permission requirements by the Cyberspace Administration of China (the “CAC”) under the applicable PRC cybersecurity laws and regulations with respect to the offering of its securities or the business operations of its PRC Subsidiaries, because neither THIL nor any of its PRC Subsidiaries qualifies as a critical information infrastructure operator or has conducted any data processing activities that affect or may affect national security or holds personal information of more than one million users. However, as PRC governmental authorities have significant discretion in interpreting and implementing statutory provisions and there remains significant uncertainty in the interpretation and enforcement of relevant PRC cybersecurity laws and regulations, there is no assurance that THIL or any of its PRC Subsidiaries will not be deemed to be subject to PRC cybersecurity review or that THIL or any of its PRC Subsidiaries will be able to pass such review. In addition, THIL and its PRC Subsidiaries could become subject to enhanced cybersecurity review or investigations launched by PRC regulators in the future pursuant to new laws, regulations or policies. Any failure or delay in the completion of the cybersecurity review procedures or any other non-compliance with applicable laws and regulations may result in fines, suspension of business, website closure, revocation of business licenses or other penalties, as well as reputational damage or legal proceedings or actions against THIL or its PRC Subsidiaries, which may have a material adverse effect on their business, financial condition or results of operations.
In addition, because THIL and its PRC Subsidiaries rely, and expect to continue to rely, significantly on DataCo to provide data maintenance and management services, technical support and consulting services in support of the operation of its loyalty program, any failure by DataCo to provide these services to THIL’s satisfaction, whether in terms of quality or timeliness, could have a material adverse effect on the business, financial condition and results of operations of THIL and its PRC Subsidiaries. Should Data Co fail to meet THIL’s expectations or unreasonably charge THIL for the services, THIL may be unable to find an alternative service provider in a timely manner, or at all, and the failure to do so could have a material adverse effect on its business, financial condition and results of operations.
THIL and its PRC Subsidiaries are subject to various restrictions on intercompany fund transfers and foreign exchange control under current PRC laws and regulations and could be subject to additional, more onerous restrictions under new PRC laws and regulations that may come into effect in the future. Due to potential interventions in or the imposition of restrictions and limitations detailed below by the PRC government on the ability of THIL or its PRC Subsidiaries to transfer cash and/or non-cash assets based on existing or new PRC laws and regulations, cash and/or non-cash assets located in mainland China or held by its PRC Subsidiaries, such as Tim Hortons China and Tim Hortons (Shanghai) Food and Beverage Co., Ltd., may not be available to fund THIL’s foreign currency needs or any foreign operations that THIL may have in the future or for other uses outside of mainland China, and THIL may not be able to effectively utilize the proceeds from the Business Combination and related financings to fund the operations or liquidity needs of its PRC Subsidiaries. Based on the experience of its management team, THIL does not believe that remittance of cash and/or non-cash assets from Hong Kong, including cash and/or non-cash assets held by THHK, an intermediary holding company with no current business operations, is subject to the aforementioned interventions, restrictions and limitations by the PRC government or similar interventions, restrictions or limitations from the government of the HKSAR, nor does THIL believe such interventions, restrictions and limitations will be imposed on THHK or any future Hong Kong subsidiary that THIL may have in the foreseeable future. To the extent that THIL’s cash and/or non-cash assets in Hong Kong or any cash and/or non-cash assets held by its Hong Kong Subsidiaries are subject to the aforementioned interventions, restrictions and limitations by the PRC government or the government of the HKSAR, then, as a result of such interventions, restrictions and limitations, such cash/assets may not be available to pay dividends to THIL, to fund the operations of THIL’s subsidiaries outside Hong Kong or to be used outside of Hong Kong for other purposes. THIL does not currently have any cash management policy that dictates show funds shall be transferred between THIL and its subsidiaries, including its PRC Subsidiaries, THHK and any other non-PRC subsidiaries that it may have in the future, or among its subsidiaries.
Dividends.   Dividends from its subsidiaries is an important source of financing for THIL. Restrictions on THIL’s PRC Subsidiaries’ ability to pay dividends to an offshore entity primarily include: (i) the PRC
 
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Subsidiaries may pay dividends only out of their accumulated after-tax profits upon satisfaction of relevant statutory conditions and procedures, if any, determined in accordance with PRC accounting standards and regulations; (ii) each of the PRC Subsidiaries is required to set aside at least 10% of its after-tax profits each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of its registered capital; (iii) the PRC Subsidiaries are required to complete certain procedural requirements related to foreign exchange control in order to make dividend payments in foreign currencies; and (iv) a withholding tax, at the rate of 10% or lower, is payable by the PRC subsidiary upon dividend remittance. Such restrictions under current PRC laws and regulations, or any new restrictions that could be imposed by new PRC laws and regulations that may come into effect in the future, could have a material and adverse effect on THIL’s ability to distribute profits to its shareholders. As of the date of this proxy statement/prospectus, neither THIL nor any of its subsidiaries have made any dividends or distributions to their parent companies or any U.S. investor. THIL is not subject to any restrictions under Cayman Islands law on dividend distribution to its shareholders and currently intends to distribute cash dividends after it becomes profitable. Any determination to pay dividends in the future will be at the discretion of the Board.
Capital expenses.   Approval from or registration with competent government authorities is required where Renminbi is to be converted into foreign currency and remitted out of mainland China to pay capital expenses, such as the repayment of loans denominated in foreign currencies. As a result, THIL’s PRC Subsidiaries are required to obtain approval from the State Administration of Foreign Exchange (the “SAFE”) or complete certain registration process in order to use cash generated from their operations to pay off their respective debt in a currency other than Renminbi owed to entities outside mainland China, or to make other capital expenditure payments outside mainland China in a currency other than Renminbi. As of the date of this proxy statement/prospectus, there has been no transfer of capital expenses among THIL and its subsidiaries.
Shareholder loans and capital contributions.    THIL’s subsidiaries may only access the proceeds from the Business Combination through loans or capital contributions from THIL. Loans by THIL to its PRC Subsidiaries to finance their operations shall not exceed certain statutory limits and must be registered with the local counterpart of the SAFE, and any capital contribution from THIL to its PRC Subsidiaries is required to be registered with the competent PRC governmental authorities. As of the date of this proxy statement/prospectus, THIL has transferred an aggregate of US$180.0 million in cash to TH Hong Kong International Limited (“THHK”) as capital injections and shareholder loans, and THHK has transferred an aggregate of US$134.0 million in cash to Tim Hortons China and US$25.0 million in cash to Tim Hortons (Shanghai) Food and Beverage Co., Ltd. as capital injections. See page F-11 of THIL’s audited historical consolidated financial statements included elsewhere in this proxy statement/prospectus for additional information on the amount of cash balances held at financial institutions in mainland China, Hong Kong and the Cayman Islands as of December 31, 2020 and 2021.
THIL’s registered address is at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. The mailing address of THIL’s principal executive office is 2501 Central Plaza, 227 Huangpi North Road, Shanghai, People’s Republic of China and its telephone number is +86-021-6136-6616.
Silver Crest Acquisition Corporation
Silver Crest is a blank check company incorporated on September 3, 2020, as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. Prior to executing the Merger Agreement, Silver Crest’s efforts were limited to organizational activities, completion of its initial public offering and the evaluation of possible business combinations.
Silver Crest’s objective is to identify global or regional businesses with differentiated products and services in one or more high growth consumer and consumer technology sectors, which can benefit from the expertise and strategic advice of Silver Crest’s management team, directors and strategic advisors, as well as a realigned ownership and management structure, to create long-term shareholder value. Silver Crest believes that the following trends will result in potentially attractive business combination targets for Silver Crest: increasing adoption of new technology in consumption activities and fulfilment; changing consumer behaviors accelerated by the COVID-19 pandemic; continued strategic reshuffling of attractive consumer
 
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assets both regionally and globally; and rapidly evolving consumption patterns of a growing Chinese middle class, serving as a harbinger of change elsewhere in the world.
Silver Crest’s registered address is at the offices of Appleby Global Services (Cayman) Limited, PO Box 500, 71 Fort Street, Grand Cayman, KY1-1106, Cayman Islands. The mailing address of Silver Crest’s principal executive office is Suite 3501, 35/F, Jardine House, 1 Connaught Place, Central, Hong Kong, and its telephone number is +852-2165-9000.
Merger Sub
Merger Sub is a newly formed Cayman Islands exempted company and a wholly owned subsidiary of THIL. Merger Sub was formed solely for the purpose of effecting the Transactions and has not carried on any activities other than those in connection with the Transactions. The address and telephone number for Merger Sub’s principal executive offices are the same as those for THIL.
The Merger Agreement (page 87)
The terms and conditions of the merger of Merger Sub with and into Silver Crest (the “First Merger”), with Silver Crest surviving the First Merger as a wholly owned subsidiary of THIL (such company, as the surviving entity of the First Merger, the “Surviving Entity”), and the merger of the Surviving Entity with and into THIL (the “Second Merger,” and together with the First Merger, the “Mergers”), with THIL surviving the Second Merger (such company, as the surviving entity of the Second Merger, the “Surviving Company”) (collectively, the “Business Combination”) are contained in the Merger Agreement, which is attached as Annex A to this proxy statement/prospectus. We encourage you to read the Merger Agreement carefully, as it is the legal document that governs the Business Combination.
Pro Forma Capitalization
The pro forma equity valuation of THIL upon consummation of the Transactions is estimated to be approximately $1.819 billion. We estimate that, immediately after the Closing, assuming none of the Silver Crest Public Shareholders demand redemption pursuant to the Silver Crest Articles and that there are no Dissenting Silver Crest Shareholders and the PIPE Investment is fully funded at the Closing and excluding (i) shares reserved for THIL’s granted share options and restricted share units subject to vesting, (ii) the Earn-out Shares, (iii) the Equity Support Shares, CEF Shares and Commitment Shares (as defined below) and (iv) shares underlying the Public Warrants, the Private Warrants and THIL’s outstanding convertible notes, the existing shareholders of THIL will own approximately 74.67% of the outstanding THIL Ordinary Shares (and Peter Yu, our Chairman and the Managing Partner of Cartesian, will indirectly own approximately 43.55% of the outstanding THIL Ordinary Shares through Pangaea Two Acquisition Holdings XXIIA Limited, an existing shareholder of THIL that is controlled by him, and another affiliate of Cartesian that is participating in the PIPE Investment), Silver Crest Public Shareholders will own approximately 20.10% of the outstanding THIL Ordinary Shares, and the Sponsor will own approximately 2.80% of the outstanding THIL Ordinary Shares. Assuming maximum redemption by Silver Crest Public Shareholders and excluding shares reserved for THIL’s granted share options and restricted share units subject to vesting, it is anticipated that the existing shareholders of THIL will own approximately 90.97% of the outstanding THIL Ordinary Shares (Mr. Yu will indirectly own approximately 53.05% of the outstanding THIL Ordinary Shares), Silver Crest Public Shareholders will own approximately 2.84% of the outstanding THIL Ordinary Shares, and the Sponsor will own approximately 3.42% of the outstanding THIL Ordinary Shares.
Merger Consideration
On the Closing Date (as defined below) and immediately prior to the First Effective Time (i) the THIL Existing Articles will be replaced with the THIL Articles, (ii) each outstanding Redeemable Share (as defined in the THIL Existing Articles), par value $0.01 per share, will be re-designated as an Ordinary Share (as defined in the THIL Existing Articles), par value $0.01 per share (each, a “THIL Pre-Split Ordinary Share”) in accordance with THIL’s organizational documents to rank pari passu with all other then-authorized and outstanding THIL Pre-Split Ordinary Shares, (iii) the authorized share capital of THIL will be reduced from
 
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$50,000 divided into 5,000,000 THIL Pre-Split Ordinary Shares to $5,000 divided into 500,000 THIL Pre-Split Ordinary Shares and (iv) immediately following such re-designation and reduction but prior to the First Effective Time, THIL will effect a share split of each THIL Pre-Split Ordinary Share into such number of ordinary shares of THIL based on the equity value of THIL (which will be based on a base enterprise valuation of THIL of $1,400,000,000 and certain adjustments thereto as set forth in the Merger Agreement), with such par value, calculated in accordance with the terms of the Merger Agreement (each a “THIL Ordinary Share”) (such share split, the “Share Split”, and together with the re-designation described in (ii) and the reduction described in (iii), the “Recapitalization”).
Pursuant to the Merger Agreement (i) immediately prior to the First Effective Time, each Silver Crest Class B Share outstanding immediately prior to the First Effective Time will be automatically converted into one Silver Crest Class A Share in accordance with the Silver Crest Articles, and, after giving effect to such automatic conversion, at the First Effective Time and as a result of the First Merger, each issued and outstanding Silver Crest Class A Share will no longer be outstanding and will automatically be converted into the right of the holder thereof to receive one THIL Ordinary Share (after giving effect to the Share Split) to be issued at the First Effective Time upon exchange of Silver Crest Class A Share in accordance with the terms of the Merger Agreement and (ii) each issued and outstanding warrant of Silver Crest sold to the public in the Silver Crest IPO (“Public Warrants”) and to Silver Crest Management LLC, a Cayman Islands limited liability company (“Sponsor”), in a private placement in connection with Silver Crest’s initial public offering (“Private Warrants”, and together with Public Warrants, “Silver Crest Warrants”) will automatically and irrevocably be assumed by THIL and converted into a corresponding warrant exercisable for THIL Ordinary Shares. Immediately prior to the First Effective Time, the Silver Crest Class A Shares and Public Warrants comprising the issued and outstanding units (the “Silver Crest Units”), each consisting of one Silver Crest Class A Share and one-half of one Public Warrant, will be automatically separated and the holder thereof will be deemed to hold one Silver Crest Class A Share and one-half of one Public Warrant, subject to the following. No fractional Public Warrants will be issued in connection with such separation such that if a holder of such Silver Crest Units would be entitled to receive a fractional Public Warrant upon such separation, the number of Public Warrants to be issued to such holder upon such separation will be rounded down to the nearest whole number of Public Warrants and no cash will be paid in lieu of such fractional Public Warrants.
Pursuant to the Merger Agreement, at the effective time of the Second Merger (the “Second Effective Time”) and as a result of the Second Merger, (i) each ordinary share of the Surviving Entity that is issued and outstanding immediately prior to the Second Effective Time (all such ordinary shares being held by THIL) will be automatically cancelled and extinguished without any conversion thereof or payment therefor; and (ii) each THIL Ordinary Share outstanding immediately prior to the Second Effective Time shall remain outstanding as a THIL Ordinary Share of the Surviving Company and shall not be affected by the Second Merger.
At the First Effective Time and as a result of the First Merger, the Silver Crest Articles will be replaced with the amended and restated memorandum and articles of association in the form annexed to the Plan of Merger and the authorized share capital of Silver Crest will be altered to $50,000.00 divided into 50,000 shares with a nominal or par value of $1.00 each, to reflect Silver Crest’s becoming a wholly owned subsidiary of THIL pursuant to the Merger Agreement.
Agreements Entered Into in Connection with the Business Combination (page 98)
Sponsor Voting and Support Agreement
Concurrently with the execution and delivery of the Merger Agreement, THIL, Silver Crest and Sponsor entered into a Voting and Support Agreement (as amended by Amendment No. 1 to the Voting and Support Agreement, dated March 9, 2022 (“Amendment No. 1 to the Sponsor Voting and Support Agreement”), by and among Silver Crest, THIL and Sponsor, and as may be further amended from time to time, the “Sponsor Voting and Support Agreement”), pursuant to which Sponsor agreed to, among other things, vote in favor of the Merger Agreement and the transactions contemplated thereby and contribute to the capital of Silver Crest for no consideration (i) 4,312,500 Silver Crest Class B Shares and (ii) 4,450,000 Private Placement Warrants, on the terms and subject to the conditions of the Sponsor Voting and Support
 
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Agreement. See the section of this proxy statement/prospectus titled “Agreements Entered Into in Connection with the Business Combination — Sponsor Voting and Support Agreement.”
Sponsor Lock-Up Agreement
Concurrently with the execution and delivery of the Merger Agreement, THIL and Sponsor entered into a Sponsor Lock-Up Agreement (the “Sponsor Lock-Up Agreement”), pursuant to which Sponsor agreed, among other things, (i) to certain transfer restrictions with respect to the THIL Ordinary Shares to be issued to Sponsor upon the consummation of the Mergers, and (ii) that 1,400,000 of the THIL Ordinary Shares to be issued to Sponsor upon the consummation of the Mergers shall become unvested and subject to forfeiture, only to be vested again if certain price milestones are achieved, in the case of each of clause (i) and (ii), subject to the terms and conditions contemplated by the Sponsor Lock-Up Agreement. See the section of this proxy statement/prospectus titled “Agreements Entered Into in Connection with the Business Combination — Sponsor Lock-Up Agreement.”
THIL Shareholder Lock-Up and Support Agreement
Concurrently with the execution and delivery of the Merger Agreement, THIL, Silver Crest and the THIL shareholders entered into a Lock-Up and Support Agreement (the “THIL Shareholder Lock-Up and Support Agreement”), pursuant to which the THIL shareholders, among other things, (i) agreed to not revoke (in whole or in part), or seek to revoke (in whole or in part), the written resolution pursuant to which the THIL shareholders, among other things, approved the Business Combination, (ii) agreed to the same lock-up restrictions as imposed on Sponsor in the Sponsor Lock-Up Agreement and (iii) received the right to receive, in the aggregate, 14,000,000 additional THIL Ordinary Shares, which right is contingent upon certain price milestones being achieved, in the case of each of clause (i), (ii) and (iii), subject to the terms and conditions contemplated by the THIL Shareholder Lock-Up and Support Agreement. The approvals, agreements and consents described above are subject to certain additional conditions. See the section of this proxy statement/prospectus titled “Agreements Entered Into in Connection with the Business Combination —  THIL Shareholder Lock-Up and Support Agreement.”
Registration Rights Agreement
The Merger Agreement contemplates that, at the Closing, Sponsor and certain of THIL shareholders will enter into a Registration Rights Agreement (the “Registration Rights Agreement”), to be effective as of the Closing, pursuant to which THIL agrees to file a registration statement as soon as practicable upon receipt of a request from certain shareholders of THIL to register the resale of certain registrable securities under the Securities Act, subject to required notice provisions to other parties thereto. THIL has also agreed to provide customary “piggyback” registration rights with respect to such registrable securities and, subject to certain circumstances, to file a resale shelf registration statement to register the resale under the Securities Act of such registrable securities. See the section of this proxy statement/prospectus titled “Agreements Entered Into in Connection with the Business Combination — Registration Rights Agreement.”
PIPE Subscription Agreements
On March 9, 2022, THIL entered into subscription agreements (the “PIPE Subscription Agreements” with certain shareholders of Pangaea Two Acquisition Holdings XXIIB Limited and THIL, an affiliate of Cartesian Capital Group, LLC, an affiliate of the Sponsor and a holder of the Notes (as defined below) (the “PIPE Investors”), pursuant to which the PIPE Investors committed to subscribe for and purchase, in the aggregate, 4,450,000 THIL Ordinary Shares for $10 per share, for an aggregate purchase price equal to $44,500,000 at the Closing (the “PIPE Investment”) on the same terms. Pursuant the PIPE Subscription Agreements, the obligations of the parties to consummate the PIPE Investment are subject to the satisfaction or waiver of certain customary closing conditions of the respective parties, including, among others, (i) the absence of a legal prohibition on consummating the PIPE Investment, (ii) all conditions precedent under the Merger Agreement having been satisfied or waived (other than those to be satisfied at the closing of the Business Combination), (iii) the accuracy of representations and warranties in all material respects and (iv) material compliance with covenants. Under the PIPE Subscription Agreements, THIL will issue to each PIPE Investor who agrees to pay a purchase price of at least $10,000,000 an aggregate of
 
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additional 600,000 THIL Ordinary Shares and 1,200,000 THIL Warrants upon the closing of the PIPE Investment for no consideration. As of the date of this proxy statement/prospectus, THRI, Tencent Mobility Limited and the affiliate of Cartesian have each agreed to invest $10,000,000 in the PIPE Investment and will each receive an additional 200,000 THIL Ordinary Shares and 400,000 THIL Warrants upon the closing of the PIPE Investment for no consideration.
The THIL Ordinary Shares to be issued in connection with the PIPE Subscription Agreements have not been registered under the Securities Act, and will be issued in reliance on the exemption from registration requirements thereof provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder. The PIPE Subscription Agreements provide that THIL will, within 45 days after the consummation of the transactions contemplated by the Merger Agreement, file with the SEC a registration statement registering the resale of such THIL Ordinary Shares and will use its commercially reasonable efforts to have such registration statement declared effective as soon as practicable after the filing thereof.
Each PIPE Subscription Agreement will terminate and be void and of no further force and effect upon the earlier of: (i) the termination of the Merger Agreement; (ii) upon mutual written agreement of THIL, Silver Crest and the PIPE Investor; (iii) 30 days after June 30, 2022 if the Business Combination has not been consummated by such date (other than as a result of a breach of obligations of such PIPE Investor); or (iv) if any of the conditions therein are not satisfied or waived prior to the closing of the PIPE Investment on or prior to closing of the PIPE Investment and, as result thereof, the subscription contemplated by such PIPE Subscription Agreement is not consummated. See the section of this proxy statement/prospectus titled “Agreements Entered Into in Connection with the Business Combination — PIPE Subscription Agreement.”
The Merger Proposal
The Silver Crest shareholders will vote on a separate proposal to authorize the First Merger and the Plan of Merger. See the section of this proxy statement/prospectus titled “Proposal Two — The Merger Proposal.”
The Adjournment Proposal
If, based upon the tabulated vote at the time of the extraordinary general meeting, there are not sufficient votes to approve one or more proposals presented to shareholders for a vote, the chairman presiding over the extraordinary general meeting may submit a proposal to adjourn the extraordinary general meeting to a later date or dates, if necessary. See the section of this proxy statement/prospectus titled “Proposal Three — The Adjournment Proposal.”
Date, Time and Place of Extraordinary General Meeting of Silver Crest’s Shareholders
The extraordinary general meeting will be held at        , Eastern time, on                 , 2022, at        and virtually over the Internet by means of a live audio webcast at https://                 , or such other date, time and place to which such meeting may be adjourned, to consider and vote upon the proposals. Due to health concerns stemming from the COVID-19 pandemic, and to support the health and wellbeing of its shareholders, Silver Crest encourages shareholders to attend the extraordinary general meeting virtually via the live webcast.
Voting Power; Record Date
Silver Crest shareholders will be entitled to vote or direct votes to be cast at the extraordinary general meeting if they owned Silver Crest Ordinary Shares at the close of business on June 6, 2022, which is the record date for the extraordinary general meeting. Silver Crest shareholders will have one vote for each Silver Crest Ordinary Share owned at 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 to ensure that votes related to the shares you beneficially own are properly counted. On the record date, there were          Silver Crest Class A Shares outstanding, of which        were Public Shares with the rest being held by the initial shareholders and their respective affiliates (including the Sponsor) and        Silver Crest Class B Shares.
 
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Redemption Rights
Pursuant to the Silver Crest Articles, a Silver Crest Public Shareholder may demand that Silver Crest redeems its Public Shares for cash if the Business Combination is consummated, subject to the conditions described in this proxy statement/prospectus, including that Silver Crest may not consummate the Business Combination if it has less than $5,000,001 of net tangible assets either immediately prior to or upon consummation of the Business Combination. Silver Crest Public Shareholders who wish to exercise their redemption rights must demand that Silver Crest redeem their Public Shares and either tender their share certificates (if any) to Silver Crest’s transfer agent or deliver their Public Shares to the transfer agent electronically using The Depository Trust Company’s DWAC System, in each case no later than two (2) business days prior to the extraordinary general meeting. If you hold the shares in “street name,” you will have to coordinate with your broker or bank to have your shares certificated and delivered electronically. Any holder that holds Public Shares beneficially through a nominee must identify itself to Silver Crest in connection with any redemption election in order to validly redeem such Public Shares. Any Silver Crest Public Shareholder satisfying the requirements for exercising redemption rights will be entitled to a pro rata portion of the amount then in the Trust Account (which, for illustrative purposes, was $      , or $       per share, as of the record date), calculated as of two (2) business days prior to the consummation of the Business Combination, including interest earned on the funds in the Trust Account and not previously released to Silver Crest to pay income taxes. Such amount will be paid promptly upon consummation of the Business Combination. There are currently no owed but unpaid income taxes on the funds in the Trust Account. If a Silver Crest Public Shareholder exercises his, her or its redemption rights, then he, she or it will be exchanging his, her or its Silver Crest Class A Shares for cash and will not become a shareholder of THIL. See the section of this proxy statement/prospectus titled “Extraordinary General Meeting of Silver Crest Shareholders — Redemption Rights” for a detailed description of the procedures to be followed if you wish to convert your shares into cash.
If Silver Crest Public Shareholders fail to take any action with respect to the extraordinary general meeting and fail to redeem their Public Shares following the procedure described in this proxy statement/prospectus and the Business Combination is approved by the Silver Crest shareholders and consummated, such Silver Crest Public Shareholders will become shareholders of THIL.
The following table presents the anticipated share ownership of various holders of THIL Ordinary Shares after the completion of the Business Combination, based on the assumption that no additional equity securities of THIL will be issued at or prior to Closing, including to any PIPE investors, and that there are no Dissenting Silver Crest Shareholders, under the following redemption scenarios:

Assuming No Redemptions: This presentation assumes that no Silver Crest Public Shareholder exercises redemption rights with respect to their Public Shares.

Assuming 50% Redemptions: This presentation assumes that Silver Crest Public Shareholders holding 15,367,983 Public Shares will exercise their redemption rights for approximately $153.7 million of the $345 million of funds in the Trust Account.

Assuming Maximum Redemptions: This presentation assumes that Silver Crest Public Shareholders holding 30,735,966 Public Shares will exercise their redemption rights for approximately $307 million of the $345 million of funds in the Trust Account, which is the maximum number of Public Shares that could be redeemed by Silver Crest Public Shareholders that allows the consummation of the Business Combination, which will not be consummated if, either immediately prior to or upon consummation of the Business Combination, Silver Crest would have net tangible assets of less than $5,000,001 after taking into account the redemption for cash of all Public Shares properly demanded to be redeemed by holders of Public Shares.
 
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Assuming
No Redemptions
Assuming
50% Redemptions
Assuming
Maximum Redemptions(1)
Shares
%
Shares
%
Shares
%
THIL Ordinary Shares:(2)
Existing Silver Crest shareholders(3)
34,500,000 20.86% 19,132,017 12.75% 3,764,034 2.80%
The Sponsor(4)
4,312,500 2.61% 4,312,500 2.88% 4,312,500 3.20%
Existing THIL shareholders(5)
126,555,003 76.53% 126,555,003 84.37% 126,555,003 94.00%
Total THIL Ordinary Shares outstanding at Closing
165,367,503 100.00% 149,999,520 100.00% 134,631,537 100.00%
Per Share Pro Forma Equity Value
of THIL Ordinary Shares
outstanding at Closing(6)
10.00 10.00 10.00
(1)
Silver Crest’s obligations under the Merger Agreement are subject to certain customary closing conditions. Furthermore, Silver Crest will only proceed with the Business Combination if it will have net tangible assets of at least $5,000,001 upon consummation of the Business Combination (as determined in accordance with Rule3a5l-l(g)(1) of the Exchange Act (or any successor rule)).
(2)
Excluding 14,000,000 Earn-out Shares, THIL Ordinary Shares underlying the Public Warrants and THIL Ordinary Shares underlying the Private Warrants. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-out.
(3)
Excluding the Sponsor.
(4)
Including 1,400,000 Earn-in Shares that, after the completion of the Business Combination, will be subject to forfeiture relating to the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-in.
(5)
Excluding 7,405,464 shares underlying THIL’s granted share options and restricted share units and 6,039,533 shares underlying THIL’s outstanding convertible notes, which are convertible into fully paid, validly issued and non-assessable THIL Ordinary Shares at a conversion price equal to $11.50 per share at any time on or after the earlier of September 30, 2022 and the Closing (see “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional details).
(6)
In each of the No Redemptions, 50% Redemptions and Maximum Redemptions scenarios, the per share pro forma equity value of THIL Ordinary Shares will be $10.00 at Closing in accordance with the terms of the Merger Agreement.
However, if the actual facts are different than the assumptions laid out above, the anticipated share ownership of various holders of THIL Ordinary Shares after the completion of the Business Combination will be different. THIL shareholders would experience dilution to the extent THIL issues additional shares after Closing, including to any PIPE investors. In addition, the table above excludes certain potential sources of dilution, namely, 7,405,464 shares underlying THIL’s granted share options and restricted share units, the Earn-out Shares, THIL Ordinary Shares to be issued to the PIPE Investors, the Equity Support Shares, the Commitment Shares, the CEF Shares and THIL Ordinary Shares underlying the Public Warrants, the Private Warrants and THIL’s outstanding convertible notes. The following table presents the anticipated share ownership of various holders of THIL Ordinary Shares after the completion of the Business Combination assuming the issuance of 7,405,464 shares underlying THIL’s granted share options and restricted share units, the Earn-out Shares, the THIL Ordinary Shares to be issued to the PIPE Investors, 300,000 Commitment Shares issuable under the CEF Purchase Agreement (assuming that the trading price of THIL Ordinary Shares on the Commitment Shares Determination Date is $10.00 per share), 5,000,000 Equity Support Shares (the maximum number of THIL Ordinary Shares that could be issued under the ESA, assuming that the existing PIPE Investment is fully funded and that at least 1,100,000 Silver Crest Public Shares are not redeemed) and THIL Ordinary Shares underlying the Public Warrants, the Private Warrants and THIL’s outstanding convertible notes (but not the CEF Shares, which may be issued by THIL from time to time at its option after the CEF Initial Resale Registration Statement becomes effective under the Securities Act and other conditions under the CEF Purchase Agreement are met), assuming that no additional equity securities of THIL will be issued at or prior to Closing, including to any PIPE investors, and that there are no Dissenting Silver Crest Shareholders, under the following redemption scenarios:
 
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Assuming
No Redemptions
Assuming
50% Redemptions
Assuming
Maximum Redemptions(1)
Shares
%
Shares
%
Shares
%
Total THIL Ordinary Shares outstanding at Closing
165,367,503 73.15% 149,999,520 71.19% 134,631,537 68.93%
Potential sources of dilution:
Shares underlying granted option
shares and restricted shares
7,405,464 3.29% 7,405,464 3.51% 7,405,464 3.79%
Earn-out shares(1)
14,000,000 6.19% 14,000,000 6.64% 14,000,000 7.17%
Shares underlying Public Warrants(2)
17,250,000 7.63% 17,250,000 8.19% 17,250,000 8.83%
Shares underlying Private Warrants(3)
4,450,000 1.97% 4,450,000 2.12% 4,450,000 2.28%
Shares underlying the Notes(4)
6,039,533 2.67% 6,039,533 2.87% 6,039,533 3.09%
Shares underlying PIPE Investment(5)
5,750,000 2.54% 5,750,000 2.73% 5,750,000 2.94%
Sponsor PIPE Shares(10)
500,000 0.22% 500,000 0.24% 500,000 0.26%
Equity Support Shares(11)
5,000,000 2.21% 5,000,000 2.37% 5,000,000 2.56%
Commitment Shares(12)
300,000 0.13% 300,000 0.14% 300,000 0.15%
Total THIL Ordinary Shares
outstanding at Closing (including
shares underlying granted option
shares and restricted shares,
earn-out shares, PIPE shares,
shares underlying warrants and
shares underlying the Notes)
226,062,500 100.00% 210,694,517 100.00% 195,326,534 100.00%
Holders of THIL Ordinary Shares
reflecting potential sources of
dilution:
Existing Silver Crest shareholders(6)
51,750,000 22.89% 36,382,017 17.27% 21,014,034 10.76%
The Sponsor(7)
9,262,500 4.10% 9,262,500 4.40% 9,262,500 4.75%
Existing THIL shareholders(8)
147,960,467 65.46% 147,960,467 70.22% 147,960,467 75.75%
Holders of the Notes(4)
6,039,533 2.67% 6,039,533 2.87% 6,039,533 3.09%
PIPE Investors(5)
5,750,000 2.54% 5,750,000 2.73% 5,750,000 2.94%
ESA Investors(11)
5,000,000 2.21% 5,000,000 2.37% 5,000,000 2.56%
Cantor(12) 300,000 0.13% 300,000 0.14% 300,000 0.15%
Per Share Pro Forma Equity Value
of THIL Ordinary Shares
outstanding at Closing(9)
10.00 10.00 10.00
(1)
After the completion of the Business Combination, existing THIL shareholders prior to the completion of the Business Combination will receive the right to receive, in the aggregate, 14,000,000 additional THIL Ordinary Shares, contingent upon the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-out.
(2)
The Public Warrants are redeemable warrants issued in the Silver Crest IPO, each entitling its holder to purchase one Silver Crest Class A Share at an exercise price of $11.50 per share, subject to adjustment. In connection with the Business Combination, such warrants will be automatically and irrevocably assumed by THIL and converted into a corresponding warrant exercisable for THIL Ordinary Shares. Based on the average of the high (US$0.44) and low (US$0.42) prices for the Public Warrants on Nasdaq on March 23, 2022, the value of the total outstanding Public Warrants would be $7,417,500.
 
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(3)
The Private Warrants are warrants sold to Sponsor in the private placement consummated concurrently with the Silver Crest IPO, each entitling its holder to purchase one Silver Crest Class A Share at an exercise price of $11.50 per share, subject to adjustment. In connection with the Business Combination, such warrants will be automatically and irrevocably assumed by THIL and converted into a corresponding warrant exercisable for THIL Ordinary Shares. Based on the average of the high (US$0.44) and low (US$0.42) prices for the Public Warrants on Nasdaq on March 23, 2022 and pursuant to Amendment No. 1 to the Sponsor Voting and Support Agreement, the value of the Private Warrants outstanding upon the Closing would be $1,913,500. In the event that, following consummation of the Business Combination, the Sponsor exercises the Private Warrants, the ownership of non-redeeming Silver Crest Public Shareholders in THIL would be diluted due to the issuance of THIL Ordinary Shares underlying such Private Warrants to the Sponsor.
(4)
Representing THIL Ordinary Shares underlying THIL’s outstanding convertible notes, which are convertible into fully paid, validly issued and non-assessable THIL Ordinary Shares at a conversion price equal to $11.50 per share at any time on or after the earlier of September 30, 2022 and the Closing (see “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional details).
(5)
Representing the aggregate of 4,550,000 THIL Ordinary Shares and 1,200,000 THIL Warrants to be issued to certain shareholders of Pangaea Two Acquisition Holdings XXIIB Limited and THIL, an affiliate of Cartesian Capital Group, LLC and a holder of the Notes (as defined below), of which 600,000 THIL Ordinary Shares and 1,200,000 THIL Warrants will be issued for no consideration to the investors that agree to pay a purchase price of at least $10,000,000, and excluding 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL. See “Agreements Entered into in Connection with the Business Combination — PIPE Subscription Agreements” and “Beneficial Ownership of Securities” for additional details.
(6)
Excluding the Sponsor and including 17,250,000 THIL Ordinary Shares underlying Public Warrants.
(7)
Including 4,450,000 THIL Ordinary Shares underlying Private Warrants, 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL, and 1.4 million Earn-in Shares that, after the completion of the Business Combination, will be subject to forfeiture relating to the occurrence of future events. See “Unaudited Pro Forma Condensed Combined Financial Information — Description of the Transactions — Earn-in.
(8)
Including 7,405,464 shares underlying THIL’s granted share options and restricted share units and 14,000,000 Earn-out Shares and excluding 6,039,533 shares underlying THIL’s outstanding convertible notes.
(9)
In each of the No Redemptions, 50% Redemptions and Maximum Redemptions scenarios, the per share pro forma equity value of THIL Ordinary Shares will be $10.00 at Closing in accordance with the terms of the Merger Agreement.
(10)
Representing the 500,000 THIL Ordinary Shares to be issued to an affiliate of the Sponsor pursuant to a PIPE Subscription Agreement between the affiliate of the Sponsor and THIL. See “Agreements Entered into in Connection with the Business Combination — PIPE Subscription Agreements” and “Beneficial Ownership of Securities” for additional details.
(11)
Representing the maximum amount of THIL Ordinary Shares that could be issued to certain third-party investors under the ESA upon the Closing, assuming that the existing PIPE Investment is fully funded and that at least 1,100,000 Silver Crest Public Shares are not redeemed. See “Summary — Recent Development — Equity Support Agreement” for additional details.
(12)
Representing the amount of THIL Ordinary Shares issuable to CF Principal Investments LLC under the CEF Purchase Agreement after the Closing and before the filing of the CEF Initial Resale Registration Statement, assuming that the trading price of THIL Ordinary Shares on the Commitment Shares Determination Date is $10.00 per share. See “Summary — Recent Development — Committed Equity Facility” for additional details.
This information should be read together with the pro forma combined financial information in the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.”
Appraisal Rights under the Cayman Companies Law
Holders of record of Silver Crest Ordinary Shares may have appraisal rights in connection with the Business Combination under the Cayman Companies Law. Holders of record of Silver Crest Ordinary Shares wishing to exercise such statutory dissenter rights and make a demand for payment of the fair value for his, her or its Silver Crest Ordinary Shares must give written objection to the First Merger to Silver Crest prior to the shareholder vote to approve the First Merger and follow the procedures set out in Section 238 of the Cayman Companies Law, noting that any such dissenter rights may subsequently be lost and extinguished pursuant to Section 239 of the Cayman Companies Law which states that no such dissenter rights shall be available in respect of shares of any class for which an open market exists on a recognized stock exchange or recognized interdealer quotation system at the expiry date of the period allowed for written notice of an election to dissent provided that the merger consideration constitutes inter alia shares of any company which at the effective date of the merger are listed on a national securities exchange. Silver Crest believes that such fair value would equal the amount that Silver Crest shareholders would obtain if they exercised their redemption rights as described herein. A Silver Crest shareholder which elects to exercise appraisal rights must do so in respect of all of the Silver Crest Ordinary Shares that person holds and will
 
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lose their right to exercise their redemption rights as described herein. See the section of this proxy statement/prospectus titled “Extraordinary General Meeting of Silver Crest Shareholders — Appraisal Rights under the Cayman Companies Law.”
Silver Crest shareholders are recommended to seek their own advice as soon as possible on the application and procedure to be followed in respect of the appraisal rights under the Cayman Companies Law.
Silver Crest’s Board of Directors’ Reasons for the Business Combination
Silver Crest’s board of directors, in evaluating the Business Combination, consulted with Silver Crest’s management and financial and legal advisors. In reaching its unanimous resolution (i) that the Merger Agreement and the transactions contemplated thereby are advisable and in the best interests of Silver Crest and its shareholders and (ii) to recommend that the shareholders adopt the Merger Agreement and approve the Business Combination and the transactions contemplated thereby, Silver Crest’s board of directors considered a range of factors, including, but not limited to, the factors discussed in the section referenced below. In light of the number and wide variety of factors considered in connection with its evaluation of the Business Combination, Silver Crest’s board of directors did not consider it practicable to, and did not attempt to, quantify or otherwise assign relative weights to the specific factors that it considered in reaching its determination and supporting its decision. Silver Crest’s board of directors viewed its decision as being based on all of the information available and the factors presented to and considered by it. In addition, individual directors may have given different weight to different factors. This explanation of Silver Crest’s reasons for the Business Combination and all other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors discussed under “Cautionary Statement Regarding Forward-Looking Statements” and “Market, Industry and Other Data.”
In approving the Business Combination, Silver Crest’s board of directors determined not to obtain a fairness opinion. The officers and directors of Silver Crest have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and concluded that their experience and background and sector expertise enabled them to make the necessary analyses and determinations regarding the Business Combination. In addition, Silver Crest’s officers and directors have substantial experience with mergers and acquisitions.
Silver Crest’s board of directors considered a number of factors pertaining to the Business Combination as generally supporting its decision to enter into the Merger Agreement and the transactions contemplated thereby. Silver Crest’s board of directors also considered a variety of uncertainties and risks and other potentially negative factors concerning the Business Combination.
Silver Crest’s board of directors concluded that the potential benefits that it expected Silver Crest and its shareholders to achieve as a result of the Business Combination outweighed the potentially negative factors associated with the Business Combination. Accordingly, Silver Crest’s board of directors unanimously determined that the Merger Agreement and the Business Combination contemplated therein were advisable, fair to and in the best interests of Silver Crest and its shareholders. See the section of this proxy statement/prospectus titled “Proposal One — The Business Combination Proposal — Silver Crest’s Board of Directors’ Reasons for the Business Combination.”
Interests of Silver Crest’s Directors and Officers in the Business Combination
In considering the recommendation of Silver Crest’s board of directors to vote in favor of approval of the Business Combination Proposal and the Merger Proposal, shareholders should keep in mind that the Sponsor and Silver Crest’s directors and executive officers have interests in such proposals that are different from, or in addition to, those of Silver Crest’s shareholders generally. If Silver Crest does not complete the Business Combination with THIL or another business combination by January 19, 2023 (or such later date as may be approved by Silver Crest’s shareholders in an amendment to the Silver Crest Articles), Silver Crest must redeem 100% of the outstanding Public Shares and liquidate and dissolve. As a result, and given the Sponsor’s interests in the Business Combination, the Sponsor may be incentivized to complete a business combination with a less favorable combination partner or on terms less favorable to Public Shareholders rather than fail to complete a business combination and be forced to liquidate and dissolve Silver Crest. In particular:
 
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If the Business Combination with THIL or another business combination is not consummated by January 19, 2023 (or such later date as may be approved by Silver Crest’s shareholders in an amendment to the Silver Crest Articles), Silver Crest will cease all operations except for the purpose of winding up, redeeming 100% of the outstanding Public Shares for cash and, subject to the approval of its remaining shareholders and Silver Crest’s board of directors, dissolving and liquidating. In such event, the Founder Shares held by the Sponsor, which were acquired for an aggregate purchase price of $25,000 prior to the Silver Crest IPO, are expected to be worthless because the holders are not entitled to participate in any redemption or distribution of proceeds in the Trust Account with respect to such shares. On the other hand, if the Business Combination is consummated, each outstanding Silver Crest Ordinary Share will be converted into one THIL Ordinary Share, subject to adjustment described herein.

If Silver Crest is unable to complete a business combination within the required time period, the Sponsor will be liable under certain circumstances described herein to ensure that the proceeds in the Trust Account are not reduced by the claims of target businesses or claims of vendors or other entities that are owed money by Silver Crest for services rendered to, or contracted for or for products sold to Silver Crest. If Silver Crest consummates a business combination, on the other hand, Silver Crest will be liable for all such claims.

The Sponsor acquired the Founder Shares, which will be converted into THIL Ordinary Shares in connection with the Business Combination, for an aggregate purchase price of $25,000 prior to the Silver Crest IPO. Based on the average of the high (US$9.86) and low (US$9.83) prices for Silver Crest Class A Shares on Nasdaq on March 23, 2022 and pursuant to Amendment No. 1 to the Sponsor Voting and Support Agreement, the value of the Founder Shares outstanding upon the Closing would be $42,456,562.50.

The Sponsor acquired the Private Warrants, which will be converted into THIL Warrants in connection with the Business Combination, for an aggregate purchase price of $8.9 million in the Silver Crest IPO. Based on the average of the high (US$0.44) and low (US$0.42) prices for the Public Warrants on Nasdaq on March 23, 2022 and pursuant to Amendment No. 1 to the Sponsor Voting and Support Agreement, the value of the Private Warrants outstanding upon the Closing would be $1,913,500.

As a result of the prices at which the Sponsor acquired the Founder Shares and the Private Warrants, and their current value, the Sponsor could make a substantial profit after the completion of the Business Combination even if Silver Crest Public Shareholders lose money on their investments as a result of a decrease in the post-combination value of their Public Shares.

An affiliate of the Sponsor entered into a PIPE Subscription Agreement to commit to subscribe for and purchase 500,000 THIL Ordinary Shares for $10 per share. See the section of this proxy statement/prospectus titled “Agreements Entered Into in Connection with the Business Combination — PIPE Subscription Agreement” for additional details regarding the PIPE Investment and PIPE Subscription Agreements.

The Sponsor and Silver Crest’s officers and directors and their affiliates are entitled to reimbursement of out-of-pocket expenses incurred by them in connection with certain activities on Silver Crest’s behalf, such as identifying and investigating possible business targets and business combinations. However, if Silver Crest fails to consummate a business combination within the required period, they will not have any claim against the Trust Account for reimbursement. Accordingly, Silver Crest may not be able to reimburse these expenses if the Business Combination or another business combination is not completed by January 19, 2023 (or such later date as may be approved by Silver Crest’s shareholders in an amendment to the Silver Crest Articles). As of the record date, the Sponsor and Silver Crest’s officers and directors and their affiliates had incurred no unpaid reimbursable expenses.

If Silver Crest is unable to complete a business combination within the required time period, the aggregate dollar amount of non-reimbursable funds would be approximately $    million, reflecting the market value of Founder Shares, the market value of Private Warrants and out-of-pocket unpaid reimbursable expenses.
 
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Silver Crest has provisions in the Silver Crest Articles waiving the corporate opportunities doctrine on an ongoing basis, which means that Silver Crest’s officers and directors have not been obligated and continue to not be obligated to bring all corporate opportunities to Silver Crest.

The Merger Agreement provides for the continued indemnification of Silver Crest’s current directors and officers and the continuation of directors and officers liability insurance covering Silver Crest’s current directors and officers.

Silver Crest’s Sponsor, affiliates of the Sponsor, officers and directors may make loans from time to time to Silver Crest to fund certain capital requirements. On September 28, 2020, the Sponsor agreed to loan Silver Crest an aggregate of up to $300,000 to cover expenses related to the Silver Crest IPO pursuant to a promissory note that was repaid in full on January 22, 2021. Additional loans may be made after the date of this proxy statement/prospectus. If the Business Combination is not consummated, any outstanding loans will not be repaid and will be forgiven except to the extent there are funds available to Silver Crest outside of the Trust Account.

Silver Crest entered into an agreement, commencing January 13, 2021 through the earlier of the consummation of a business combination or its liquidation, to pay the Sponsor a monthly fee of $10,000 for office space, utilities, secretarial and administrative services.

Derek Cheung, currently the Chief Executive Officer and a Director of Silver Crest, will be a member of the board of directors of THIL following the closing of the Business Combination and, therefore, in the future Mr. Cheung will receive cash fees, share options or share-based awards that the board of directors of THIL determines to pay to its non-executive directors.
Recommendation to Silver Crest Shareholders
Silver Crest’s board of directors has determined that each of the proposals outlined herein is fair to and in the best interests of Silver Crest and its shareholders and recommended that Silver Crest shareholders vote “FOR” the Business Combination proposal, “FOR” the Merger Proposal and “FOR” the Adjournment Proposal, if presented.
Material U.S. Federal Income Tax Considerations (page 198)
For a description of the material U.S. federal income tax consequences of the Business Combination, the exercise of redemption rights in respect of Silver Crest Ordinary Shares and the ownership and disposition of THIL Ordinary Shares, please see “Taxation — Material U.S. Federal Income Tax Considerations” beginning on page 198.
Material PRC Tax Considerations (page 208)
For a description of the material PRC tax consequences of the ownership and disposition of THIL Ordinary Shares, please see “Taxation — Material PRC Tax Considerations” beginning on page 208.
Anticipated Accounting Treatment
THIL prepares its financial statements in accordance with U.S. GAAP. In determining the accounting treatment of the merger, management has evaluated all pertinent facts and circumstances, including whether Silver Crest, which is a special purpose acquisition company, meets the definition of a business. Silver Crest has raised significant capital through the issuance of shares and warrants and was formed to effect a merger, capital, stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more operating businesses. THIL has concluded that although Silver Crest has substantial activities related to its formation, capital raise and search for is a business combination, it does not meet the definition of a business.
Although Silver Crest did not meet the definition of a business, the determination of the accounting acquirer was performed to determine whether Silver Crest was the accounting acquirer. The accounting acquirer is the entity that obtains control of the acquiree. The determination of the accounting acquirer considers many factors, including the relative voting rights in the combined entity after the business
 
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combination, the existence of a large minority interest in the combined entity if no other owner or organized group of owners has a significant voting interest, the composition of the governing body of the combined entity, the composition of the senior management of the combined entity, the terms of the exchange of equity securities, the relative size of the combining entities and which of the combining entities initiated the combination. There is no hierarchical guidance on determining the accounting acquirer in a business combination effected through an exchange of equity interests.
THIL has concluded that THIL is the accounting acquirer based on its evaluation of the facts and circumstances of the acquisition. The purpose of the merger was to assist THIL with the refinancing and recapitalization of its business. THIL is the larger of the two entities and is the operating company within the combining companies. THIL will have control of the board as it will hold a majority of the seats on the THIL board of directors and Silver Crest shareholders will not have any continuing board appointment rights after the initial consent to one board member appointed to serve after the merger. THIL’ senior management will be continuing as senior management of the combined company. In addition, a larger portion of the voting rights in the combined entity will be held by existing THIL shareholders. Additionally, the Silver Crest shareholders are expected to represent a diverse group of shareholders at completion of the merger and we are not aware of any voting or other agreements that suggest that they can act as one party.
As THIL was determined to be the acquirer for accounting purposes, the accounting for the transaction will be similar to that of a capital infusion as the only significant pre-combination asset of Silver Crest is the cash and cash equivalents. No intangibles or goodwill will arise through the accounting for the transaction. The accounting is the equivalent of THIL issuing shares of common stock for the net monetary assets of Silver Crest.
Comparison of Rights of THIL Shareholders and Silver Crest Shareholder (page 224)
If the Business Combination is successfully completed, holders of Silver Crest Ordinary Shares will become holders of THIL Ordinary Shares and their rights as shareholders will be governed by THIL’s organizational documents. Please see “THIL Shareholders and Silver Crest Shareholder” beginning on page 224 for more information.
Emerging Growth Company
Each of Silver Crest and THIL is, and consequently, following the Business Combination, the combined company will be, an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such, the combined company will be eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in their periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find the combined company’s securities less attractive as a result, there may be a less active trading market for the combined company’s securities and the prices of the combined company’s securities may be more volatile.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The combined company does not intend to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the combined company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the combined company’s financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used.
 
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The combined company will remain an emerging growth company until the earlier of: (i) the last day of the fiscal year (a) following the fifth anniversary of the Silver Crest IPO, (b) in which THIL has total annual gross revenue of at least $1.07 billion, or (c) in which the combined company is deemed to be a large accelerated filer, which means the market value of the combined company’s common equity that is held by non-affiliates exceeds $700 million as of the last business day of its most recently completed second fiscal quarter; and (ii) the date on which the combined company has issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to “emerging growth company” have the meaning associated with it in the JOBS Act.
Foreign Private Issuer
THIL is a foreign private issuer within the meaning of the rules under the Exchange Act and, as such, THIL is permitted to follow the corporate governance practices of its home country, the Cayman Islands, in lieu of the corporate governance standards of Nasdaq applicable to U.S. domestic companies. For example, THIL is not required to have a majority of the board consisting of independent directors nor have a compensation committee or a nominating and corporate governance committee consisting entirely of independent directors. THIL intends to continue to follow its home country’s corporate governance practices as long as it remains a foreign private issuer. As a result, THIL’s shareholders may not have the same protection afforded to shareholders of U.S. domestic companies that are subject to Nasdaq corporate governance requirements. As a foreign private issuer, THIL is also subject to reduced disclosure requirements and are exempt from certain provisions of the U.S. securities rules and regulations applicable to U.S. domestic issuers such as the rules regulating solicitation of proxies and certain insider reporting and short-swing profit rules.
Controlled Company
Immediately following the Closing, Peter Yu, our Chairman and the Managing Partner of Cartesian, is anticipated to own over 50% of the equity interest and voting power of the combined company through Pangaea Two Acquisition Holdings XXIIA Limited, a shareholder of Pangaea Two Acquisition Holdings XXIIB Limited (an existing shareholder of THIL) and an entity controlled by Mr. Yu, assuming the PIPE Investment is fully funded at the Closing and not taking into account (i) shares reserved for THIL’s granted share options and restricted share units subject to vesting, (ii) the Earn-out Shares, (iii) the Equity Support Shares, CEF Shares and Commitment Shares (as defined below) and (iv) shares underlying the Public Warrants, Private Warrants and THIL’s outstanding convertible notes, if Silver Crest Public Shareholders holding 22,135,130 or more Public Shares decide to exercise their redemption rights. Under the No Redemptions Scenario and the Maximum Redemptions Scenario, such percentage will be 43.55% and 53.05%, respectively. As a result of Peter Yu’s majority ownership and voting power, which would give him the ability to control the outcome of certain matters submitted to the combined company’s shareholders for approval, including the appointment or removal of directors (subject to certain limitations described elsewhere in this registration statement/proxy statement), the combined company may qualify as a “controlled company” within the meaning of Nasdaq’s corporate governance standards. For more details on the nomination rights of existing THIL shareholders, see “Comparison of Rights of THIL Shareholders and Silver Crest Shareholders — Comparison of Shareholders’ Rights — Nomination Rights.” If the combined company qualifies as a “controlled company,” it will have the option not to comply with certain requirements to which companies that are not controlled companies are subject, including the requirement that a majority of its board of directors shall consist of independent directors and the requirement that its nominating and corporate governance committee and compensation committee shall be composed entirely of independent directors. In the event that the combined company qualifies as a “controlled company,” THIL does not intend to take advantage of these exemptions. However, THIL cannot guarantee that this may not change going forward. For more details on related risks, see “Risk Factors —Risks Related to the Business Combination — Peter Yu, the Chairman and Managing Partner of Cartesian, will have over 50% equity interest and voting power in the combined company if Silver Crest Public Shareholders holding more than 22,135,130 Public Shares exercise their redemption rights, and THIL may qualify as a “controlled company” within the meaning of Nasdaq corporate governance rules after the Closing, which could exempt THIL from certain corporate governance requirements that provide protection to shareholders of companies that are not controlled companies.
 
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Going Concern
THIL has concluded that its recurring losses from operations and need for additional financing to fund future operations raise substantial doubt about its ability to continue as a going concern. THIL’s independent registered public accounting firm has included an explanatory paragraph in its report on THIL’s consolidated balance sheets as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive loss, changes in shareholders' equity, and cash flows for the years ended December 31, 2021, 2020 and 2019 with respect to this uncertainty. In order to reduce liquidity risks and risks related to its ability to continue as a going concern, THIL has evaluated plans to slow down the pace of its store network expansion, which, if implemented, could adversely affect the growth of its revenue and customer base.
Based upon THIL’s current operating plan and assumptions, THIL believes that its existing sources of liquidity, together with the cash that it expects to receive from the Business Combination, will be sufficient to fund its operations, including lease obligations, capital expenditures and working capital obligations for at least the next 12 months. However, the assumptions underlying this estimate may prove to be wrong, and changes may occur beyond its control and cause THIL to consume its available capital sooner than expected. See “THIL’s Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional details.
Recent Development
Convertible Notes
On December 9, 2021, THIL and Pangaea Two Acquisition Holdings XXIIA Limited entered into a Convertible Note Purchase Agreement with each of two institutional accredited investors. On December 10, 2021, THIL issued $50 million aggregate principal amount of convertible notes (the “Private Notes”) to the investors for a purchase price of 98% of the principal amount thereof.
On December 30, 2021, THIL issued $50 million aggregate principal amount of convertible notes (the “Notes”) under an indenture dated as of such date with Wilmington Savings Fund Society, FSB, as trustee (the “Indenture”). The Notes were issued in exchange for the Private Notes, which were cancelled upon such exchange. The Notes mature on December 10, 2026 (the “Maturity Date”) and bear interest commencing as of December 10, 2021, payable semi-annually in arrears on June 10 and December 10 of each year, commencing on June 10, 2022. THIL has the option, on each interest payment date, to pay accrued and unpaid interest (i) entirely in cash or (ii) by capitalizing such accrued and unpaid interest (such capitalized interest, “PIK Interest”). Interest on the Notes accrues at the following rates: (i) until September 30, 2022, 7% per annum if paid in cash or 9% per annum if paid in the form of PIK Interest, and (ii) if the Business Combination is not consummated prior to September 30, 2022, on or after September 30, 2022, 10% per annum if paid in cash or 12% per annum if paid in the form of PIK Interest.
Each holder of a Note has the right, after June 10, 2025, to require THIL to repurchase all of such holder’s Notes at a repurchase price equal to the principal amount of such Note plus accrued and unpaid interest thereon to, but excluding, the repurchase date. THIL has the right to redeem the Notes in whole, but not in part, (i) at a redemption price equal to 102% of the principal amount of the Notes, plus accrued and unpaid interest thereon to, but excluding, the redemption date, in the event of certain tax changes as described in the Indenture; or (ii) at any time before December 10, 2025, at a redemption price equal to: (a) if the redemption is prior to December 10, 2024, 100% of the principal amount of the Notes plus a “make-whole” as described in the Indenture, and (b) if the redemption is on or after December 10, 2024 and prior to December 10, 2025, 104% of the principal amount of the Notes plus accrued and unpaid interest thereon to, but excluding, the redemption date.
Each Note is convertible into fully paid, validly issued and non-assessable THIL Ordinary Shares (the “Conversion Shares”) at a conversion price equal to $11.50 per share, subject to certain resets and adjustments as described in the Indenture (the “Conversion Price”). Each holder of a Note has the right to convert all of such holder’s Notes at any time on or after the earlier of September 30, 2022 and the Closing, until the Maturity Date. Subject to the terms and conditions in the Convertible Note Purchase Agreement, THIL has agreed to file with the SEC a shelf registration statement registering the resale of the Conversion Shares
 
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within 45 calendar days after the Closing and to use its commercially reasonable efforts to have the registration statement declared effective as soon as practicable. The Convertible Note Purchase Agreement also contains customary piggyback registration rights.
After the Closing, THIL will have the right, at any time on or after the later of (i) December 10, 2023 and (ii) the effective date of a registration statement filed by THIL with the SEC registering the resale of the THIL Ordinary Shares issuable upon conversion of the Notes, until the Maturity Date, to convert all of the Notes, but only if (i) the last reported sale price per THIL Ordinary Share is equal to or greater than 130% of the Conversion Price on each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the trading day immediately before the date THIL provides notice of such conversion, and (ii) the average daily trading volume in dollars of the THIL Ordinary Shares is more than $5 million.
The Indenture contains covenants that, subject to significant exceptions, restrict the ability of THIL and its subsidiaries to, among other things, incur debt, issue preferred stock, pay dividends on or purchase or redeem their capital stock, incur liens, sell assets, amend or terminate its Amended and Restated Master Development Agreement (the “A&R MDA”), and amended and restated company franchise agreements with THRI, amend their charter documents, or consolidate with or merge with or into other entities. The Indenture also contains events of default and acceleration that are customary for transactions of this nature. On May 26, 2022, a waiver was executed to relieve THIL from the obligation to provide copies of its unaudited financial statements for the fiscal quarter ended March 31, 2022 to the holders of the Notes.
The Notes are listed on the Singapore Exchange Securities Trading Limited.
Equity Support Agreement
On March 8, 2022, THIL entered into an Equity Support Agreement (the “ESA”) with Shaolin Capital Management LLC (“Shaolin”), pursuant to which Shaolin committed to purchase, substantially concurrently with the Closing, THIL Ordinary Shares (the “Equity Support Shares”) in a private placement for a purchase price of $10.00 per share. On May 25, 2022, Shaolin assigned all of its rights and obligations under the Equity Support Agreement to Shaolin Capital Master Fund, Ltd and certain other third-party investors (the “ESA Investors”). The aggregate number of the Equity Support Shares that may be purchased by the ESA Investors under the ESA shall be determined by THIL, not to exceed the lesser of (1) 5,000,000 and (2) the sum of (x) the number of THIL Ordinary Shares subscribed in the PIPE Investment actually purchased or funded for purchase pursuant to the PIPE Subscription Agreements, and (y) 50% of any Public Shares in respect of which the applicable holder has not validly exercised his, her or its redemption right, provided that such shares are not the result of any non-redemption or investment agreement, arrangement, contract or similar that (i) does not provide cash proceeds that are immediately available upon the Closing; (ii) includes a share buyback obligation or (iii) provides a valuation period that would precede, overlap with or follow, in whole or in part, any Reference Periods (as defined below). Subject to the terms and conditions set forth in the ESA, by the earlier of (A) five business days after the redemption election deadline and (B) two business days before the Closing, THIL will notify the ESA Investors of the number of the Equity Support Shares that it requires the ESA Investors to purchase immediately prior to the Closing.
On the closing date of the Equity Support Shares purchase, the ESA Investors are required to deliver to a custody account of THIL established and maintained by U.S. Bank, National Association and pledged to each ESA Investor (the “Collateral Account”) an amount of cash equal to the number of its Equity Support Shares multiplied by $10.00 (the “Subscription Amount”). As a condition to the ESA Investors’ obligation to deliver the Subscription Amount to the Collateral Account, THIL is required to (i) deposit or cause to be deposited directly into an amount of cash equal to (1) the sum of (x) $10.40 multiplied by one-third of the number of Equity Support Shares, (y) $10.60 multiplied by one-third of the number of Equity Support Shares, plus (z) $10.90 multiplied by one-third of the number of Equity Support Shares, minus (2) the Subscription Amount; and (ii) have paid or caused to be paid to the ESA Investors an option premium in the amount of $500,000 (the “Option Premium”).
There are three reference periods under the ESA:

the First Reference Period: the 25 consecutive VWAP Trading Days (as defined in the ESA) beginning on, and including, the 85th calendar day immediately following the date of the Closing;
 
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the Second Reference Period: the 25 consecutive VWAP Trading Days beginning on, and including, the 145th calendar day immediately following the date of the Closing; and

the Third Reference Period: the 25 consecutive VWAP Trading Days beginning on, and including, the 235th calendar day immediately following the date of the Closing.
On or prior to 5 p.m. U.S. Eastern Time on the business day immediately following the final VWAP Trading Day of each Reference Period, THIL shall pay to the ESA Investors the applicable Reference Period Payment (as defined below), and the ESA Investors shall cause the applicable Issuer Release Amount (as defined below) to be released to THIL from the Collateral Account.
“Reference Period Payment” means one-third of the Equity Support Shares multiplied by (i) $10.40 (in the case of the First Reference Period), $10.60 (in the case of the Second Reference Period) or $10.90 (in the case of the Third Reference Period) minus the arithmetic averages of the volume-weighted average price for each VWAP Trading Day during the applicable Reference Period (as adjusted, the “Reference Price”), if the Reference Price is less than $10.40 (in the case of the First Reference Period), $10.60 (in the case of the Second Reference Period) or $10.90 (in the case of the Third Reference Period); or (ii) zero, if the Reference Price is greater than or equal to $10.40 (in the case of the First Reference Period), $10.60 (in the case of the Second Reference Period) or $10.90 (in the case of the Third Reference Period). “Issuer Release Amount” means an amount equal to (i) one-third of the Equity Support Shares multiplied by (ii) the lesser of (x) $10.40 (in the case of the First Reference Period), $10.60 (in the case of the Second Reference Period) or $10.90 (in the case of the Third Reference Period) and (y) the Reference Price; provided that in no event shall the Issuer Release Amount cause the principal balance of the Collateral Account to be less than the maximum possible amount of the remaining Reference Period Payments.
Following the conclusion of, as applicable, the Third Reference Period or the final accelerated Reference Period (as defined below) and the payment or release of the Reference Period Payment for the Third Reference Period or for the final accelerated Reference Period, the ESA Investors shall cause the outstanding balance of the Collateral Account to be released to THIL.
The ESA also provides that THIL is obligated to, within 15 calendar days after the Closing, file with the SEC a registration statement to register the resale of the Equity Support Shares.
The ESA contains customary representations, warranties, conditions and indemnification obligations of the parties. The representations, warranties and covenants contained in such agreements were made only for purposes of the ESA, were solely for the benefit of the parties to such agreements and are subject to certain limitations.
The ESA shall terminate (a) upon the termination of the Business Combination, (b) upon the mutual written agreement of each of the parties, (c) if the closing conditions are not satisfied, or capable of being satisfied, on or prior to the Closing, or (d) if the Closing has not occurred by the earlier of August 31, 2022 or five calendar days from the termination date of the Merger Agreement. Immediately upon the termination of the ESA, (x) any monies paid by the ESA Investors in connection therewith shall be returned to it and (y) THIL shall be obligated to pay the Option Premium to the ESA Investors, notwithstanding such termination.
In order to secure the payment and the performance of all obligations of THIL to each ESA Investor pursuant to the ESA, THIL and the ESA Investors entered into a Pledge and Security Agreement on May 25, 2022, pursuant to which THIL granted to each ESA Investor a first priority security interest in and lien on, and a right of set-off against, (i) the Collateral Account; (ii) THIL’s rights, title and interest in and to the ESA and the Pledge and Security Agreement; and (iii) all proceeds of, and all other profits, products, rents or receipts, in whatever form, arising from the collection, sale, lease, exchange, assignment, or other disposition of, or other realization upon, (i) and (ii). Shaolin serves as a collateral agent on behalf of the ESA Investors under the Pledge and Security Agreement.
Committed Equity Facility
On March 11, 2022, THIL entered into an Ordinary Share Purchase Agreement (the “CEF Purchase Agreement”) with CF Principal Investments LLC (“Cantor”) relating to a committed equity facility. Pursuant
 
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to the CEF Purchase Agreement, THIL has the right, after the Closing and from time to time at its option, to sell to Cantor up to $100.0 million of THIL Ordinary Shares (the “CEF Shares”) subject to certain conditions and limitations set forth in the CEF Purchase Agreement, including that the CEF Initial Resale Registration Statement (as defined below), which shall be filed by THIL as soon as practicable after the Closing, shall have become effective under the Securities Act. In addition, in connection with the execution of the CEF Purchase Agreement and as consideration for its irrevocable commitment to purchase the CEF Shares, THIL has agreed to issue a certain amount of THIL Ordinary Shares of an aggregate value of $3,000,000 to Cantor after the Closing and before the trading day prior to the filing of the CEF Initial Resale Registration Statement, subject to the satisfaction of the conditions set forth in the CEF Purchase Agreement (the “Commitment Shares”). The number of Commitment Shares to be issued will equal to $3,000,000 divided by the fair market value of the THIL Ordinary shares on a date that is the earlier to occur of (i) the second trading day prior to the filing of the CEF Initial Resale Registration Statement and (ii) the trading day prior to Cantor sending an invoice to THIL for the Commitment Shares (the “Commitment Shares Determination Date”). Sales of the CEF Shares to Cantor under the CEF Purchase Agreement, and the timing of any sales, will be determined by THIL from time to time in its sole discretion and will depend on a variety of factors, including, among other things, market conditions, the trading price of the CEF Shares and determinations by THIL regarding the use of proceeds of such CEF Shares. The net proceeds from any sales under the CEF Purchase Agreement will depend on the frequency with, and prices at, which the CEF Shares are sold to Cantor. THIL expects to use the proceeds from any sales under the CEF Purchase Agreement for working capital and general corporate purposes.
In addition, THIL and Cantor simultaneously entered into a registration rights agreement (the “CEF Registration Rights Agreement”), pursuant to which, following the Closing, THIL is obligated to file a registration statement (the “CEF Initial Resale Registration Statement”) with the SEC to register under the Securities Act the resale by Cantor of the CEF Shares and the Commitment Shares.
Upon the initial satisfaction of the conditions to Cantor’s obligation to purchase the CEF Shares set forth in the CEF Purchase Agreement (the “Commencement”), including that the CEF Initial Resale Registration Statement is declared effective by the SEC and a final prospectus relating thereto is filed with the SEC, THIL will have the right, but not the obligation, from time to time at its sole discretion until the first day of the month next following the 36-month period from and after Commencement, to direct Cantor to purchase up to a specified maximum amount of CEF Shares as set forth in the CEF Purchase Agreement by delivering written notice to Cantor prior to the commencement of trading on any trading day. The purchase price of the CEF Shares that THIL elects to sell to Cantor pursuant to the CEF Purchase Agreement will be 97% of the volume weighted average price of the THIL Ordinary Shares during the applicable purchase date on which THIL has timely delivered written notice to Cantor directing it to purchase CEF Shares under the CEF Purchase Agreement.
The CEF Purchase Agreement and the CEF Registration Rights Agreement contain customary representations, warranties, conditions and indemnification obligations of the parties. The representations, warranties and covenants contained in such agreements were made only for purposes of such agreements and as of specific dates, were solely for the benefit of the parties to such agreements and are subject to certain limitations.
THIL has the right to terminate the CEF Purchase Agreement at any time after Commencement, at no cost or penalty, upon 10 trading days’ prior written notice. Additionally, Cantor has the right to terminate the CEF Purchase Agreement on the seventh trading day following the Closing if the aggregate market value of the outstanding voting and non-voting common equity (as defined in Rule 405 under the Securities Act) of THIL is less than $100 million as of such date. No termination of the CEF Purchase Agreement will affect the registration rights provisions contained in the CEF Registration Rights Agreement.
Regulatory Matters
The Business Combination is not subject to any federal or state regulatory requirement or approval, except for the filings with the Cayman Islands Registrar of Companies necessary to effectuate the Business Combination.
 
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Substantially all of THIL’s revenue is derived from the operations of its PRC Subsidiaries in mainland China. THIL and its PRC Subsidiaries are subject to PRC laws relating to, among others, restrictions over foreign investments and data security. The PRC government has been seeking to exert more control and impose more restrictions on companies based in mainland China raising capital offshore and such efforts may continue or intensify in the future. The PRC government’s exertion of more control over offerings conducted overseas and/or foreign investment in issuers based in mainland China could result in a material change in the operations of THIL’s PRC Subsidiaries, significantly limit or completely hinder THIL’s ability to offer or continue to offer securities to investors, and cause the value of THIL’s securities to significantly decline or be worthless. Based on the opinion of THIL’s PRC counsel, Han Kun Law Offices, according to its interpretation of the currently in-effect PRC laws and regulations, THIL believes that the issuance of THIL’s securities to foreign investors in connection with the Business Combination, or in the future, does not require permission or approval from any PRC governmental authority. However, as PRC governmental authorities have significant discretion in interpreting and implementing statutory provisions, there is no assurance that such approval or permission will not be required under existing PRC laws, regulations or policies if the relevant PRC governmental authorities take a contrary position or adopt new interpretations, or under any new laws or regulations that may be promulgated in the future. Below is a summary of potential PRC laws and regulations that, in the opinion of Han Kun Law Offices according to its interpretation of the currently in-effect PRC laws and regulations, could be interpreted by the in-charge PRC government authorities, namely, the China Securities Regulatory Commission (the “CSRC”), the CAC and their enforcement agencies, to require THIL to obtain permission or approval in order to issue securities to foreign investors in connection with the Business Combination or offer securities to foreign investors. Based on the experience of THIL’s management team, THIL does not believe that any permission or approval is required under any laws or regulations of the HKSAR for it to issue securities to non-PRC investors in connection with the Business Combination or offer securities to non-PRC investors or for any of its PRC Subsidiaries to conduct their business operations in mainland China. However, there is no assurance that such approval or permission will not be required under HKSAR laws, regulations or policies if the relevant HKSAR governmental authorities take a contrary position, nor can THIL predict whether or how long it will take to obtain such approval.
The Regulations on Mergers and Acquisitions of Domestic Companies by Foreign Investors adopted by six PRC regulatory agencies, including the Ministry of Commerce of the PRC (the “MOFCOM”), the State-Owned Assets Supervision and Administration Commission, the State Administration of Taxation, the State Administration for Industry and Commerce, currently known as the SAMR, the CSRC, and the SAFE in 2006 and amended in 2009, as well as some other regulations and rules concerning mergers and acquisitions (collectively, the “M&A Rules”) include provisions that purport to require that an offshore special purpose vehicle that is controlled by PRC domestic companies or individuals and that has been formed for the purpose of an overseas listing of securities through acquisitions of PRC domestic companies or assets to obtain the approval of the CSRC prior to the listing and trading of such special purpose vehicle’s securities on an overseas stock exchange. On September 21, 2006, the CSRC published its approval procedures for overseas listings by special purpose vehicles. However, substantial uncertainty remains regarding the scope and applicability of the M&A Rules to offshore special purpose vehicles. While the application of the M&A Rules remains unclear, THIL believes, based on the advice of its PRC legal counsel and its understanding of the current PRC laws and regulations, that the CSRC approval is not required in the context of the Business Combination because (i) our PRC Subsidiaries were established by means of direct investment, rather than by merger or acquisition, directly or indirectly, of the equity interest or assets of any “domestic company,” as defined under the M&A Rules, and (ii) the CSRC currently has not issued any definitive rule or interpretation concerning whether a transaction of the kind contemplated herein is subject to the M&A Rules. However, there can be no assurance that the relevant PRC government agencies, including the CSRC, would reach the same conclusion as THIL’s PRC legal counsel.
On December 24, 2021, the CSRC released the draft Administrative Provisions on the Offshore Listing and Securities Issuance of PRC-Based Companies and the draft Administrative Measures on the Filing of Offshore Listing and Securities Issuance of PRC-Based Companies for public comments through January 23, 2022 (collectively, the “CSRC Draft Rules”), which seek to impose certain filing requirements on issuers that intend to list or offer securities on foreign stock exchanges through direct or indirect offshore listings. Based on the opinion of THIL’s PRC counsel, Han Kun Law Offices, according to its interpretation of the currently in-effect PRC laws and regulations, THIL does not believe there will be any substantial obstacle in
 
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making the filings if it is deemed to be subject to the filing requirements, unless the relevant government authorities fail to issue any required regulatory opinions or approvals, including cybersecurity assessment review opinions. Failure to comply with the filing requirements or any other requirements under the CSRC Draft Rules (if enacted) could result in warnings, a fine ranging from RMB 1 million to RMB 10 million, suspension of certain business operations, orders of rectification and revocation of business license. If THIL fails to receive or maintain any requisite permission or approval from the CSRC for the Business Combination or future offerings, or the waiver for such permission or approval, in a timely manner, or at all, or inadvertently concludes that such permission or approval is not required, or if applicable laws, regulations or interpretations change and obligate it to obtain such permission or approvals in the future, THIL or its PRC Subsidiaries may be subject to fines and penalties (the details of which are unknown at this point), limitations on its business activities in mainland China, delay or restrictions on the contribution of the proceeds from the Business Combination into the PRC, or other sanctions that could have a material adverse effect on its business, financial condition, results of operations, reputation and prospects. In addition, the CSRC may also take actions requiring THIL, or making it advisable for THIL, to halt the Business Combination or future offerings. For a more detailed analysis, see “Risk Factors — Risks Related to Doing Business in China — The approval and/or other requirements of Chinese governmental authorities may be required in connection with the Business Combination under PRC laws, regulations or policies.”
Furthermore, in April 2020, the PRC government promulgated the Cybersecurity Review Measures (the “2020 Cybersecurity Review Measures”), which came into effect on June 1, 2020. On November 14, 2021, the CAC released the draft Administrative Regulation on Network Data Security for public comments through December 13, 2021 (the “Draft Administrative Regulation”). Under the Draft Administrative Regulation, (i) data processors (i.e., individuals and organizations who can decide on the purpose and method of their data processing activities at their own discretion) that process personal information of more than one million individuals shall apply for cybersecurity review before listing in a foreign country; (ii) foreign-listed data processors shall carry out annual data security evaluation and submit the evaluation report to the municipal cyberspace administration authority; and (iii) where a data processor undergoes merger, reorganization and subdivision that involves important data and personal information of more than one million individuals, the recipient of the data shall report the transaction to the in-charge authority at the municipal level. On December 28, 2021, the PRC government promulgated amended Cybersecurity Review Measures (the “2022 Cybersecurity Review Measures”), which came into effect and replaced the 2020 Cybersecurity Review Measures on February 15, 2022. According to the 2022 Cybersecurity Review Measures, (i) critical information infrastructure operators that purchase network products and services and internet platform operators that conduct data processing activities shall be subject to cybersecurity review in accordance with the 2022 Cybersecurity Review Measures if such activities affect or may affect national security; and (ii) internet platform operators holding personal information of more than one million users and seeking to have their securities list on a stock exchange in a foreign country shall file for cybersecurity review with the Cybersecurity Review Office. Based on the opinion of THIL’s PRC counsel, Han Kun Law Offices, according to its interpretation of the currently in-effect PRC laws and regulations, THIL believes that neither THIL nor any of its PRC Subsidiaries is subject to cybersecurity review, reporting or other permission requirements by the CAC under the applicable PRC cybersecurity laws and regulations with respect to the offering of its securities or the business operations of its PRC Subsidiaries, because neither THIL nor any of its PRC Subsidiaries qualifies as a critical information infrastructure operator or has conducted any data processing activities that affect or may affect national security or holds personal information of more than one million users. However, as PRC governmental authorities have significant discretion in interpreting and implementing statutory provisions and there remains significant uncertainty in the interpretation and enforcement of relevant PRC cybersecurity laws and regulations, there is no assurance that THIL or any of its PRC Subsidiaries will not be deemed to be subject to PRC cybersecurity review or that THIL or any of its PRC Subsidiaries will be able to pass such review. If THIL or any of its PRC Subsidiaries fails to receive any requisite permission or approval from the CAC for the Business Combination or its business operations, or the waiver for such permission or approval, in a timely manner, or at all, or inadvertently concludes that such permission or approval is not required, or if applicable laws, regulations or interpretations change and obligate it to obtain such permission or approvals in the future, THIL or its PRC Subsidiaries may be subject to fines, suspension of business, website closure, revocation of business licenses or other penalties, as well as reputational damage or legal proceedings or actions against THIL or its PRC Subsidiaries, which may have a material adverse effect on its business, financial condition
 
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or results of operations. In addition, THIL and its PRC Subsidiaries could become subject to enhanced cybersecurity review or investigations launched by PRC regulators in the future pursuant to new laws, regulations or policies. Any failure or delay in the completion of the cybersecurity review procedures or any other non-compliance with applicable laws and regulations may result in fines, suspension of business, website closure, revocation of business licenses or other penalties, as well as reputational damage or legal proceedings or actions against THIL or its PRC Subsidiaries, which may have a material adverse effect on their business, financial condition or results of operations. For a more detailed analysis, see “Risk Factors — Risks Related to THIL’s Business and Industry — We and our PRC Subsidiaries are subject to a variety of laws and regulations regarding cybersecurity and data protection, and any failure to comply with applicable laws and regulations could have a material adverse effect on our business, financial condition and results of operations.”
In addition, with respect to their business operations, THIL’s PRC Subsidiaries are required to maintain various approvals, licenses and permits to operate the company owned and operated stores and engage in commercial franchising activities in accordance with relevant PRC laws and regulations. In the opinion of Han Kun Law Offices according to its interpretation of the currently in-effect PRC laws and regulations, THIL’s PRC Subsidiaries are required to obtain and maintain the following approvals, licenses and permits for the operation of THIL’s company owned and operated stores: (i) business licenses issued by the local PRC State Administration for Market Regulation (the “SAMR”), (ii) food operation licenses issued by the competent food safety supervision and administration department, and (iii) for some stores, fire safety inspection permits from the local fire department. These approvals, licenses and permits can be obtained upon satisfactory compliance with, among other things, the applicable laws and regulations. Any PRC Subsidiary that is engaged in commercial franchising is required to (i) register as a commercial franchisor with the commerce department of the local government within fifteen days after entering into a franchise agreement with a franchisee located in mainland China for the first time; (ii) file with the in-charge authority information regarding franchise agreements entered into, withdrawn, renewed or amended each year by March 31 of the following year; and (iii) report any changes to its previously filed registration information and information on its operational resources and the geographical distribution of its franchisees’ stores in mainland China within 30 calendar days following such change.
As of May 31, 2022, out of the 418 company owned and operated stores operated by THIL’s PRC Subsidiaries, seven stores had not obtained the requisite business licenses or the requisite food operation licenses, which stores represented less than 1% of THIL’s total revenues in 2021. Local governments have significant discretion in promulgating, interpreting and implementing fire safety rules and policies. As a result, there is no assurance that the fire safety inspection permit will not be required for certain company owned and operated stores that THIL believes, based on evaluations conducted by external fire safety specialists, are not required to obtain a fire safety inspection permit under existing PRC laws, regulations or policies if relevant PRC governmental authorities take a contrary position or adopt new interpretations, or under any new laws or regulations that may be promulgated in the future. Based on evaluations conducted by fire safety specialists engaged by THIL, five of THIL’s company owned and operated stores have not obtained those fire safety inspection permits that THIL believes are required under the applicable laws and regulations. THIL’s PRC Subsidiaries are still in the process of applying for these outstanding licenses and permits, and how soon these licenses and permits can be obtained is subject to regulatory approvals and certain other factors that are beyond their control. Failure to obtain the necessary licenses, permits and approvals could subject THIL’s PRC Subsidiaries to fines, confiscation of gains derived from the stores, or the suspension of operations of the stores. Specifically, (i) for stores without a business license, the in-charge government authorities may order such stores to rectify the non-compliance and impose a fine of up to RMB100,000 for each store; (ii) for stores without a food operation license, the in-charge government authorities may confiscate the income of such stores and their food and beverage products, raw materials and equipment and impose fines based on the value of the food and beverage products of such store; and (iii) for stores that operate without the requisite fire safety inspection permit, the in-charge government authorities may order such stores to rectify the non-compliance, suspend their operations and impose a fine ranging from RMB30,000 to RMB300,000 for each store. None of THIL’s PRC Subsidiaries have been denied of any of such approvals, licenses and permits for the company owned and operated stores that they operate, nor have they been subject to any fines or penalties with respect to the lack of such approvals, licenses and permits.
 
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Tim Hortons China, the only PRC Subsidiary of THIL that is, or has been, engaged in commercial franchising, has received the requisite governmental approval to be registered as a commercial franchisor and has fulfilled its annual and ongoing reporting obligations up until March 2022, when the government reporting system was shut down due to the COVID-19 outbreak in Shanghai. In general, if a commercial franchisor fails to comply with the annual filing requirement by the filing deadline, it could be ordered by the in-charge authority to rectify the non-compliance and be subject to a fine ranging from RMB10,000 to RMB50,000. However, based on its discussions with local government officials, Tim Hortons China does not believe that it will be subject to any administrative penalty, including fines, as a result of its failure to timely file the 2021 annual report because the reporting system was closed to all local filers before the filing deadline.
THHK, a wholly-owned subsidiary of THIL incorporated under the laws of the HKSAR, does not currently have any business operations. THHK holds the requisite business license and has not been required by the HKSAR government to hold any other license, permit or approval under the laws and regulations of the HKSAR. Based on the experience of its management team, THIL does not believe that THHK is required to obtain such license, permit or approval. However, there is no assurance that the relevant HKSAR governmental authorities will not take a contrary position or that THHK can obtain such license, permit or approval, if required. If THHK fails to obtain such license, permit or approval in a timely manner, or at all, THIL’s business and results of operations could be materially and adversely affected. For a more detailed analysis, see “Risk Factors — Risks Related to Doing Business in China — Any lack of requisite approvals, licenses or permits applicable to our business may have a material adverse effect on our business, financial condition and results of operations.
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 29. Such risks include, but are not limited to:

THIL has a limited operating history in China, which makes it difficult to predict its business, financial performance and prospects, and THIL may not be able to maintain its historical growth rates in future periods.

THIL may not be able to successfully execute its strategies, sustain its growth or manage the increasing complexity of its business.

Economic conditions have adversely affected, and may continue to adversely affect, consumer discretionary spending, which could negatively impact THIL’s business, financial condition and results of operations.

Uncertainties relating to the growth of China’s coffee industry and food and beverage sector could adversely affect THIL’s results of operations and business prospects.

Food safety concerns and concerns about the health risk of THIL’s products may have an adverse effect on its business.

The COVID-19 pandemic has adversely affected and may from time to time adversely affect THIL’s financial condition and results of operations in the future.

If relations between China and the United States or China and Canada deteriorate, THIL’s business, results of operations and financial condition could be adversely affected.

If we are unable to maintain or increase prices, we may fail to maintain a positive margin.
In addition, THIL and its PRC Subsidiaries face various other legal and operational risks associated with doing business in China, which could result in a material change in the post-combination operations of THIL’s PRC Subsidiaries, cause the value of THIL’s securities to significantly decline or become worthless, and significantly limit or completely hinder its ability to accept foreign investments and offer or continue to offer securities to foreign investors. These risks include:

The offering of THIL securities may be subject to additional disclosure requirements and review that the SEC or other regulatory authorities in the United States may adopt for companies with China-based operations, which could increase THIL’s compliance costs, subject it to additional disclosure
 
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requirements, and/or suspend or terminate its future securities offerings. See “Risk Factors — Risks Related to Doing Business in China — Additional disclosure requirements to be adopted by and regulatory scrutiny from the SEC in response to risks related to companies with substantial operations in China, which could increase its compliance costs, subject it to additional disclosure requirements, and/or suspend or terminate its future securities offerings, making capital-raising more difficult.

Regulatory developments in mainland China, in particular with respect to restrictions on companies based in mainland China raising capital offshore and the government-led cybersecurity reviews of certain companies, may lead to additional PRC regulatory review over THIL’s financing and capital raising activities in the United States. The approval and/or other requirements of PRC governmental authorities, such as the CSRC and the CAC, may be required in connection with the Business Combination under PRC laws, regulations or policies. See “Risk Factors — Risks Related to Doing Business in China — The approval and/or other requirements of Chinese governmental authorities may be required in connection with the Business Combination under PRC laws, regulations or policies.

PRC governmental authorities have significant oversight and discretion over the business operations of THIL’s PRC Subsidiaries and may seek to intervene or influence such operations at any time that the government deems appropriate to further its regulatory, political and societal goals. In addition, the PRC governmental authorities may also exert more control over offerings that are conducted overseas and/or foreign investment in issuers based in mainland China. The PRC government’s exertion of more control over offerings conducted overseas and/or foreign investment in issuers based in mainland China could result in a material change in the operations of THIL’s PRC Subsidiaries, significantly limit or completely hinder THIL’s ability to offer or continue to offer securities to investors, and cause the value of THIL’s securities to significantly decline or be worthless. See “Risk Factors — Risks Related to Doing Business in China — PRC governmental authorities’ significant oversight and discretion over our business operation could result in a material adverse change in our operations following the combination and the value of our securities.

THIL’s business, financial condition, results of operations and prospects may be influenced to a significant degree by political, economic and social conditions in China, including, among others, overall economic growth, level of urbanization and level of per capita disposable income. See “Risk Factors — Risks Related to Doing Business in China — Changes in China’s economic, political or social conditions or government policies could have a material adverse effect on our business and operations.”

THIL is subject to significant uncertainty and inconsistency regarding the interpretation and enforcement of many PRC laws and regulations, and these laws and regulations can change quickly with limited advance notice. See “Risk Factors — Risks Related to Doing Business in China — The business operations of our PRC Subsidiaries are subject to various PRC laws and regulations, the interpretation and enforcement of which involve significant uncertainties as the PRC legal system is evolving rapidly.

Due to potential interventions in or the imposition of restrictions and limitations by the PRC government on the ability of THIL or its PRC Subsidiaries to transfer cash and/or non-cash assets based on existing or new PRC laws and regulations, THIL’s cash and/or non-cash assets located in mainland China or held by THIL’s PRC Subsidiaries, such as Tim Hortons China and Tim Hortons (Shanghai) Food and Beverage Co., Ltd., may not be available to fund its foreign currency needs or any foreign operations that it may have in the future or for other uses outside of mainland China, and THIL may not be able to effectively utilize the proceeds from the Business Combination and related financings to fund the operations or liquidity needs of its PRC Subsidiaries. For example, payment of dividends by THIL's PRC Subsidiaries is subject to various restrictions, loans by THIL to its PRC Subsidiaries to finance their operations are subject to certain statutory limits and must be registered with the local counterpart of the SAFE, and any capital contribution from THIL to its PRC Subsidiaries is required to be registered with the competent PRC governmental authorities. See “Risk Factors — Risks Related to Doing Business in China — Restrictions on our subsidiaries on paying dividends or making other payments to us under existing or new laws and regulations of the PRC and the HKSAR may restrict our ability to satisfy our liquid