UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF
THE SECURITIES EXCHANGE ACT OF 1934

(Amendment No. 1)

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Check the appropriate box:

CENAQ Energy Corp.

(Name of Registrant as Specified In Its Charter)

N/A  
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

PRELIMINARY PROXY STATEMENT — SUBJECT TO COMPLETION, DATED SEPTEMBER 29, 2022

PROXY STATEMENT FOR SPECIAL MEETING OF STOCKHOLDERS OF
CENAQ ENERGY CORP.

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Dear Stockholders of CENAQ Energy Corp.:

You are cordially invited to attend the special meeting (the “special meeting”) of stockholders of CENAQ Energy Corp. (“CENAQ,” “we,” “our,” “us” or the “Company”), which will be held at            , Eastern time, on            , 2022, via live webcast at the following address:            . At the special meeting, CENAQ stockholders will be asked to consider and vote upon the following proposals:

•        The Business Combination Proposal — To consider and vote upon a proposal to (a) approve and adopt the Business Combination Agreement and Plan of Reorganization, dated as of August 12, 2022 (as the same may be amended, supplemented or modified, the “Business Combination Agreement”), among CENAQ, Verde Clean Fuels OpCo, LLC, a Delaware limited liability company and a wholly owned subsidiary of CENAQ (“OpCo”), Bluescape Clean Fuels Holdings, LLC, a Delaware limited liability company (“Holdings”), Bluescape Clean Fuels Intermediate Holdings, LLC, a Delaware limited liability company (“Intermediate”), and CENAQ Sponsor LLC (the “Sponsor”) (solely with respect to Section 6.18 thereto), pursuant to which (i) (A) CENAQ will contribute to OpCo (1) all of its assets (excluding its interests in OpCo and the aggregate amount of cash required to satisfy any exercise by CENAQ stockholders of their Redemption Rights (as defined below)) and (2) 22,500,000 newly issued shares of Class C common stock, par value $0.0001 per share (the “Class C Common Stock”), of CENAQ (such shares, the “Holdings Class C Shares”) and (B) in exchange therefor, OpCo will issue to CENAQ a number of Class A common units (the “Class A OpCo Units”) of OpCo equal to the number of total shares of Class A common stock, par value $0.0001 per share (the “Class A Common Stock”), of CENAQ issued and outstanding immediately after the closing (the “Closing”) of the transactions (the “Transactions”) contemplated by the Business Combination Agreement (taking into account the PIPE Financing (as defined below) and following the exercise of Redemption Rights) (such transactions, the “SPAC Contribution”) and (ii) immediately following the SPAC Contribution, (A) Holdings will contribute to OpCo 100% of the issued and outstanding limited liability company interests of Intermediate and (B) in exchange therefor, OpCo will transfer to Holdings (1) 22,500,000 Class C common units (the “Class C OpCo Units” and, together with the Class A OpCo Units, the “OpCo Units”) of OpCo (the “Holdings OpCo Units”) and the Holdings Class C Shares (such transactions, the “Holdings Contribution” and, together with the SPAC Contribution, the “business combination”) and (b) approve the business combination and the Transactions (the “Business Combination Proposal”) (Proposal No. 1). A copy of the Business Combination Agreement is attached to this proxy statement as Annex A.

•        The Charter Proposal — To consider and vote upon a proposal to approve and adopt, assuming the Business Combination Proposal and the Nasdaq Proposal (as defined below) are approved and adopted, the fourth amended and restated certificate of incorporation (the “Proposed Fourth A&R Charter”), a copy of the form of which is attached to the accompanying proxy statement as Annex B (the “Charter Proposal”) (Proposal No. 2), which, if approved, would take effect upon Closing.

In addition to the approval of the Proposed Fourth A&R Charter, the stockholders are also separately being presented with the following proposals (the “Advisory Charter Proposals”), for approval on a non-binding advisory basis, to give stockholders the opportunity to present their separate views on certain corporate governance provisions in the Proposed Fourth A&R Charter:

•        Proposal 2A — to increase the number of authorized shares of CENAQ’s capital stock, par value $0.0001 per share, from 221,000,000 shares, consisting of (a) 220,000,000 shares of common stock, including 200,000,000 shares of Class A Common Stock and 20,000,000 shares of Class B common stock (the “Class B Common Stock”), and (b) 1,000,000 shares of preferred stock, to 376,000,000 shares, consisting of (i) 350,000,000 shares of Class A Common Stock, (ii) 25,000,000 shares of Class C Common Stock and (iii) 1,000,000 shares of preferred stock;

•        Proposal 2B — to remove certain provisions in the Charter relating to CENAQ’s initial business combination and provisions applicable only to blank check companies that will no longer be applicable to CENAQ following the Closing;

•        Proposal 2C — to allow stockholders to call special meetings and act by written consent until such time that Verde Clean Fuels (as defined below) is no longer a “Controlled Company” pursuant to Nasdaq Listing Rule 5615(c)(1);

•        Proposal 2D — to absolve certain Verde Clean Fuels stockholders from certain competition and corporate opportunities obligations;

•        Proposal 2E — to allow officers of Verde Clean Fuels to be exculpated from personal monetary liability pursuant to the General Corporation Law of the State of Delaware; and

•        Proposal 2F — to provide that holders of Class A Common Stock and holders of Class C Common Stock will vote together as a single class on all matters, except as required by law or by our Proposed Fourth A&R Charter.

•        The Nasdaq Proposal — To consider and vote upon a proposal to approve, for purposes of complying with applicable listing rules of the Nasdaq Capital Market, (a) the issuance of 22,500,000 shares of Class C Common Stock pursuant to the Business Combination Agreement, (b) the issuance of 22,500,000 shares of Class A Common Stock upon the exchange of the Class C OpCo Units, together with an equal number of shares of Class C Common Stock, for shares of Class A Common Stock pursuant to the amended and restated limited liability company agreement of OpCo (the “OpCo A&R LLC Agreement”) and the Proposed Fourth A&R Charter and (c) the issuance and sale of 8,000,000 shares of Class A Common Stock in the private offering of securities to certain investors (the “Nasdaq Proposal”) (Proposal No. 3).

•        The 2023 Plan Proposal — To consider and vote upon a proposal to approve and adopt the Verde Clean Fuels, Inc. 2023 Omnibus Incentive Plan (the “2023 Plan”) (the “2023 Plan Proposal”) (Proposal No. 4). A copy of the 2023 Plan is attached to this proxy statement as Annex C.

•        The Director Election Proposal — To consider and vote upon a proposal to elect two directors to serve until the 2023 annual meeting of stockholders, two directors to serve until the 2024 annual meeting of stockholders and three directors to serve until the 2025 annual meeting of stockholders, and until their respective successors are duly elected and qualified, subject to such directors’ earlier death, resignation, retirement, disqualification or removal (the “Director Election Proposal”) (Proposal No. 5).

•        The Adjournment Proposal — To consider and vote upon a proposal to approve the adjournment of the special meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Business Combination Proposal, the Charter Proposal, the Nasdaq Proposal, the 2023 Plan Proposal or the Director Election Proposal (the “Adjournment Proposal” and, together with the Business Combination Proposal, the Charter Proposal, the Nasdaq Proposal, the 2023 Plan Proposal and the Director Election Proposal, the “Proposals”) (Proposal No. 6).

In connection with the Closing, CENAQ will change its name to Verde Clean Fuels, Inc. (“Verde Clean Fuels”). The combined company will be organized in an “Up-C” structure and the only direct assets of Verde Clean Fuels will consist of equity interests in OpCo, whose only direct assets will consist of equity interests in Intermediate. Immediately following the Closing, Verde Clean Fuels will be the sole manager of and control OpCo, will own 100% of the outstanding Class A OpCo Units and is expected to own between approximately 35.37% and 55.06% of the outstanding OpCo Units. Further, Holdings will own 100% of the outstanding Class C OpCo Units and shares of Class C Common Stock, and is expected to own between approximately 44.94% and 64.63% of the outstanding OpCo Units and between approximately 46.54% and 66.93% of the voting power of Verde Clean Fuels (which includes the 800,000 shares of Class A Common Stock purchased by Holdings in the private offering of securities of Verde Clean Fuels to certain investors in connection with the business combination (the “PIPE Financing”)).

Each share of Class C Common Stock has no economic rights but entitles its holder to one vote on all matters to be voted on by stockholders generally. Holders of shares of Class A Common Stock and shares of Class C Common Stock will vote together as a single class on all matters presented to our stockholders for their vote or approval, except as otherwise required by applicable law or by our Proposed Fourth A&R Charter. We do not intend to list any shares of Class C Common Stock on any exchange.

Following this Closing, under the OpCo A&R LLC Agreement, each OpCo unitholder (excluding us) will, subject to certain timing procedures and other conditions set forth therein, have the right (the “OpCo Exchange Right”) to exchange all or a portion of its Class C OpCo Units for, at OpCo’s election, (i) shares of our Class A Common Stock at an exchange ratio of one share of Class A Common Stock for each Class C OpCo Unit exchanged, subject to conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar transactions, or (ii) an equivalent amount of cash. OpCo will determine whether to pay cash in lieu of the issuance of shares of Class A Common Stock based on facts in existence at the time of the decision, which we expect would include the relative value of the Class A Common Stock (including trading prices for the Class A Common Stock at the time), the cash purchase price, the availability of other sources of liquidity (such as an issuance of stock) to acquire the Class C OpCo Units and alternative uses for such cash. Additionally, Verde Clean Fuels will have the right to require, (i) upon a change of control of Verde Clean Fuels or (ii) in the discretion of Verde Clean Fuels with the consent of at least fifty percent (50%) of the holders of Class C OpCo Units, each other OpCo unitholder to exchange all of its Class C OpCo Units (a “Mandatory Exchange”).

Upon the exercise of the OpCo Exchange Right or a Mandatory Exchange, Verde Clean Fuels (instead of OpCo) will have the right, which we refer to as the “Call Right,” to, for administrative convenience, acquire each tendered Class C OpCo Unit directly from the OpCo unitholder for, at its election, (x) one share of Class A Common Stock, subject to conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar transactions, or (y) an equivalent amount of cash, and such Class C OpCo Units shall be automatically recapitalized into the same number of Class A OpCo Units. In connection with any exchange of Class C OpCo Units pursuant to the OpCo Exchange Right or acquisition of Class C OpCo Units pursuant to a Mandatory Exchange or the Call Right, a corresponding number of shares of Class C Common Stock held by the relevant OpCo unitholder will be cancelled. See “Proposal No. 1 — The Business Combination Proposal — Related Documents — OpCo A&R LLC Agreement.”

Verde Clean Fuels’ acquisition (or deemed acquisition for U.S. federal income tax purposes) of Class C OpCo Units pursuant to an exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right is expected to result in adjustments to the tax basis of the tangible and intangible assets of OpCo, and such adjustments will generally be allocated to Verde Clean Fuels. These adjustments would not have been available to Verde Clean Fuels absent its acquisition or deemed acquisition of Class C OpCo Units and are expected to reduce the amount of cash tax that Verde Clean Fuels would otherwise be required to pay in the future.

At the Closing, Verde Clean Fuels will enter into a tax receivable agreement (the “Tax Receivable Agreement”) with Holdings (together with its permitted transferees, the “TRA Holders,” and each a “TRA Holder”) and the “Agent” (as defined in the Tax Receivable Agreement to mean Holdings or such other person designated as such pursuant to the Tax Receivable Agreement), which will generally provide for the payment by Verde Clean Fuels to each TRA Holder of 85% of the net cash savings, if any, in U.S. federal, state and local income tax and franchise tax (computed using simplifying assumptions to address the impact of state and local taxes) that Verde Clean Fuels actually realizes (or is deemed to realize in certain circumstances) in periods after the business combination as a result of (i) certain increases in tax basis that occur as a result of Verde Clean Fuels’ acquisition (or deemed acquisition for U.S. federal income tax purposes) of all or a portion of such TRA Holder’s Class C OpCo Units pursuant to the exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right and (ii) imputed interest deemed to be paid by Verde Clean Fuels as a result of, and additional tax basis arising from, any payments Verde Clean Fuels makes under the Tax Receivable Agreement. The Tax Receivable Agreement contains a payment cap of $50,000,000 (the “Payment Cap”), which applies only to certain payments required to be made in connection with the occurrence of a change of control. The Payment Cap would not be reduced or offset by any amounts previously paid under the Tax Receivable Agreement or any amounts that are required to be paid (but have not yet been paid) for the year in which the change of control occurs or any prior years. Verde Clean Fuels will depend on OpCo to make distributions to Verde Clean Fuels in an amount sufficient to cover Verde Clean Fuels’ obligations under the Tax Receivable Agreement. We will retain the benefit of the remaining 15% of any actual net

cash tax savings. For additional information regarding the Tax Receivable Agreement, see “— Risk Factors — Risks Related to CENAQ and the Business Combination” and “Proposal No. 1 — The Business Combination Proposal — Related Documents — Tax Receivable Agreement.”

The special meeting will be completely virtual. There will be no physical meeting location and the special meeting will only be conducted via live webcast at the following address:            .

The board of directors of CENAQ (the “CENAQ Board”) recommends that CENAQ stockholders vote “FOR” each Proposal (or in the case of the Director Election Proposal, “FOR ALL NOMINEES”) being submitted to a vote of the stockholders at the special meeting. When you consider the recommendation of the CENAQ Board in favor of each of the Proposals, you should keep in mind that certain of CENAQ’s directors and officers have interests in the business combination that may conflict with your interests as a stockholder. Please see the section entitled “Proposal No. 1 — The Business Combination Proposal — Interests of Certain Persons in the Business Combination.”

Each of the Proposals is more fully described in this proxy statement, which each CENAQ stockholder is encouraged to review carefully.

CENAQ’s Class A Common Stock and warrants sold as part of the units in our initial public offering (the “IPO”) (whether they were purchased in the IPO or thereafter in the open market (“Public Warrants”)), which are exercisable for shares of Class A Common Stock under certain circumstances, are currently listed on the Nasdaq Capital Market under the symbols “CENQ” and “CENQW,” respectively. In addition, certain of our shares of Class A Common Stock and warrants currently trade as units consisting of one share of Class A Common Stock and three-quarters of one warrant, and are listed on the Nasdaq Capital Market under the symbol “CENQU.” The units will automatically separate into the component securities upon consummation of the business combination and, as a result, will no longer trade as a separate security. In connection with the Closing, we intend to change our name from “CENAQ Energy Corp.” to “Verde Clean Fuels, Inc.” and we expect that the shares of Class A Common Stock and the warrants of the post-combination company will continue trading on the Nasdaq Capital Market under the new symbols “VGAS” and “VGASW,” respectively, following the Closing.

Pursuant to our Charter, we are providing the holders of shares of Class A Common Stock originally sold as part of the units issued in the IPO (such holders, the “Public Stockholders”) with the opportunity to redeem (“Redemption Rights”), upon the Closing, shares of Class A Common Stock then held by them for cash equal to their pro rata share of the aggregate amount on deposit (as of two business days prior to the Closing) in the trust account (the “Trust Account”) that holds the proceeds (including interest not previously released to CENAQ to pay its franchise and income taxes as well as expenses relating to the administration of the Trust Account) from the IPO and a concurrent private placement of warrants to the Sponsor and the underwriters of the IPO (the “underwriters”). For illustrative purposes, based on the fair value of cash and marketable securities held in the Trust Account as of June 30, 2022 of approximately $174.5 million, the estimated per share redemption price would have been approximately $10.11. Public Stockholders may elect to redeem their shares whether or not they are holders as of the record date and whether or not they vote for the Business Combination Proposal. Notwithstanding the foregoing Redemption Rights, a Public Stockholder, together with any of his, her or its affiliates or any other person with whom he, she or it is acting in concert or as a “group” (as defined under Section 13(d)(3) of the Securities Exchange Act of 1934, as amended), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 15% of the outstanding shares of Class A Common Stock sold in the IPO. Holders of the Public Warrants do not have Redemption Rights in connection with the business combination. Our Sponsor, officers and directors and the underwriters have agreed to waive their Redemption Rights in connection with the consummation of the business combination with respect to any shares of Class A Common Stock they may hold. Additionally, our Sponsor and certain qualified institutional buyers or institutional accredited investors that participated in the IPO (the “Anchor Investors”) have agreed to waive their Redemption Rights with respect to the shares of Class B Common Stock, and the shares of Class A Common Stock issued upon the conversion thereof (the “Founder Shares”), they received in the IPO, and our shares of Class B Common Stock will be excluded from the pro rata calculation used to determine the per share redemption price. Currently, our Sponsor and the Anchor Investors own all of the shares of Class B Common Stock, which represent approximately 20% of our outstanding Class A Common Stock and Class B Common Stock. Our Sponsor, officers and directors have agreed to vote any shares of Class A Common Stock and Class B Common Stock, including the Founder Shares,

owned by them in favor of the business combination, the underwriters have agreed to vote any shares of Class A Common Stock owned by them in favor of the business combination and the Anchor Investors have agreed to vote the Founder Shares owned by them in favor of the business combination.

CENAQ is providing this proxy statement and accompanying proxy card to its stockholders in connection with the solicitation of proxies to be voted at the special meeting and any adjournments or postponements of the special meeting. Your vote is very important. Whether or not you plan to attend the special meeting virtually, please submit your proxy card without delay.

We encourage you to read this proxy statement carefully. In particular, you should review the matters discussed under the section entitled “Risk Factors” beginning on page 38 of this proxy statement.

Approval of each of the Business Combination Proposal, the Nasdaq Proposal, the 2023 Plan Proposal and the Adjournment Proposal requires the affirmative vote (online or by proxy) of the holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote and actually cast thereon at the special meeting, voting as a single class. Approval of the Charter Proposal requires the affirmative vote (online or by proxy) of (i) the holders of a majority of the shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class, and (ii) the holders of a majority of the shares of Class A Common Stock entitled to vote thereon at the special meeting. In addition to the approval of the Charter Proposal, you are separately being presented the Advisory Charter Proposals, for approval on a non-binding advisory basis, to give stockholders the opportunity to present their separate view on certain corporate governance provisions in the Proposed Fourth A&R Charter. Approval of the Advisory Charter Proposals requires the affirmative vote (online or by proxy) of the holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class. Approval of the Director Election Proposal requires the affirmative vote (online or by proxy) of a plurality of the votes cast by holders of our Class A Common Stock and Class B Common Stock at the special meeting and entitled to vote thereon, voting as a single class.

If you sign, date and return your proxy card without indicating how you wish to vote, your proxy will be voted “FOR” each of Proposal Nos. 1, 2, 3, 4 and 6 and “FOR ALL NOMINEES” for Proposal No. 5. If you fail to return your proxy card or fail to submit your proxy by telephone or over the Internet, or fail to instruct your bank, broker or other nominee how to vote, and do not virtually attend the special meeting, the effect will be that your shares will not be counted for purposes of determining whether a quorum is present at the special meeting and, if a quorum is present, will have no effect on the Business Combination Proposal, the Nasdaq Proposal, the 2023 Plan Proposal, the Director Election Proposal or the Adjournment Proposal, but will have the same effect as a vote “AGAINST” the Charter Proposal. If you are a stockholder of record and you virtually attend the special meeting and wish to vote, you may withdraw your proxy and vote online.

TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST ELECT TO HAVE CENAQ REDEEM YOUR SHARES FOR A PRO RATA PORTION OF THE FUNDS HELD IN THE TRUST ACCOUNT AND TENDER YOUR SHARES TO CENAQ’S TRANSFER AGENT AT LEAST TWO BUSINESS DAYS PRIOR TO THE VOTE AT THE SPECIAL MEETING. YOU MAY TENDER YOUR SHARES BY EITHER DELIVERING YOUR SHARE CERTIFICATE TO THE TRANSFER AGENT OR BY DELIVERING YOUR SHARES ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT WITHDRAWAL AT CUSTODIAN) SYSTEM. IF THE BUSINESS COMBINATION IS NOT COMPLETED, THEN THESE SHARES WILL NOT BE REDEEMED FOR CASH. IF YOU HOLD THE SHARES IN STREET NAME, YOU WILL NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BANK OR BROKER TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS.

Thank you for your consideration of these matters.

Sincerely,

J. Russell Porter

Chief Executive Officer and Director

CENAQ Energy Corp.

Whether or not you plan to attend the special meeting of CENAQ stockholders online, please submit your proxy by completing, signing, dating and mailing the enclosed proxy card in the pre-addressed postage paid envelope or by using the telephone or Internet procedures provided to you by your broker or bank. If your shares are held in an account at a brokerage firm or bank, you must instruct your broker or bank on how to vote your shares or, if you wish to attend the special meeting of CENAQ stockholders and vote online, you must obtain a proxy from your broker or bank.

Neither the Securities and Exchange Commission nor any state securities commission has passed upon the adequacy or accuracy of this proxy statement. Any representation to the contrary is a criminal offense.

This proxy statement is dated            , 2022 and is first being mailed to CENAQ stockholders on or about            , 2022.

CENAQ ENERGY CORP.

4550 Post Oak Place Drive, Suite 300
Houston, Texas 77027

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
OF CENAQ ENERGY CORP.

To Be Held On            , 2022

To the Stockholders of CENAQ Energy Corp.:

NOTICE IS HEREBY GIVEN that the special meeting (the “special meeting”) of stockholders of CENAQ Energy Corp. (“CENAQ,” “we,” “our,” “us” or the “Company”) will be held at            , Eastern time, on            , 2022, via live webcast at the following address:            . At the special meeting, CENAQ stockholders will be asked to consider and vote upon the following proposals:

•        The Business Combination Proposal — To consider and vote upon a proposal to (a) approve and adopt the Business Combination Agreement and Plan of Reorganization, dated as of August 12, 2022 (as the same may be amended, supplemented or modified, the “Business Combination Agreement”), among CENAQ, Verde Clean Fuels OpCo, LLC, a Delaware limited liability company and a wholly owned subsidiary of CENAQ (“OpCo”), Bluescape Clean Fuels Holdings, LLC, a Delaware limited liability company (“Holdings”), Bluescape Clean Fuels Intermediate Holdings, LLC, a Delaware limited liability company (“Intermediate”), and CENAQ Sponsor LLC (the “Sponsor”) (solely with respect to Section 6.18 thereto), pursuant to which (i) (A) CENAQ will contribute to OpCo (1) all of its assets (excluding its interests in OpCo and the aggregate amount of cash required to satisfy any exercise by CENAQ stockholders of their Redemption Rights (as defined below)) and (2) 22,500,000 newly issued shares of Class C common stock, par value $0.0001 per share (the “Class C Common Stock”), of CENAQ (such shares, the “Holdings Class C Shares”) and (B) in exchange therefor, OpCo will issue to CENAQ a number of Class A common units (the “Class A OpCo Units”) of OpCo equal to the number of total shares of Class A common stock, par value $0.0001 per share (the “Class A Common Stock”), of CENAQ issued and outstanding immediately after the closing (the “Closing”) of the transactions (the “Transactions”) contemplated by the Business Combination Agreement (taking into account the PIPE Financing (as defined below) and following the exercise of Redemption Rights) (such transactions, the “SPAC Contribution”) and (ii) immediately following the SPAC Contribution, (A) Holdings will contribute to OpCo 100% of the issued and outstanding limited liability company interests of Intermediate and (B) in exchange therefor, OpCo will transfer to Holdings (1) 22,500,000 Class C common units (the “Class C OpCo Units” and, together with the Class A OpCo Units, the “OpCo Units”) of OpCo (the “Holdings OpCo Units”) and the Holdings Class C Shares (such transactions, the “Holdings Contribution” and, together with the SPAC Contribution, the “business combination”) and (b) approve the business combination and the Transactions (the “Business Combination Proposal”) (Proposal No. 1). A copy of the Business Combination Agreement is attached to this proxy statement as Annex A.

•        The Charter Proposal — To consider and vote upon a proposal to approve and adopt, assuming the Business Combination Proposal and the Nasdaq Proposal (as defined below) are approved and adopted, the fourth amended and restated certificate of incorporation (the “Proposed Fourth A&R Charter”), a copy of the form of which is attached to the accompanying proxy statement as Annex B (the “Charter Proposal”) (Proposal No. 2), which, if approved, would take effect upon Closing.

In addition to the approval of the Proposed Fourth A&R Charter, the stockholders are also separately being presented with the following proposals (the “Advisory Charter Proposals”), for approval on a non-binding advisory basis, to give stockholders the opportunity to present their separate views on certain corporate governance provisions in the Proposed Fourth A&R Charter:

•        Proposal 2A — to increase the number of authorized shares of CENAQ’s capital stock, par value $0.0001 per share, from 221,000,000 shares, consisting of (a) 220,000,000 shares of common stock, including 200,000,000 shares of Class A Common Stock and 20,000,000 shares of

Class B common stock (the “Class B Common Stock”), and (b) 1,000,000 shares of preferred stock, to 376,000,000 shares, consisting of (i) 350,000,000 shares of Class A Common Stock, (ii) 25,000,000 shares of Class C Common Stock and (iii) 1,000,000 shares of preferred stock;

•        Proposal 2B — to remove certain provisions in the Charter relating to CENAQ’s initial business combination and provisions applicable only to blank check companies that will no longer be applicable to CENAQ following the Closing;

•        Proposal 2C — to allow stockholders to call special meetings and act by written consent until such time that Verde Clean Fuels (as defined below) is no longer a “Controlled Company” pursuant to Nasdaq Listing Rule 5615(c)(1);

•        Proposal 2D — to absolve certain Verde Clean Fuels stockholders from certain competition and corporate opportunities obligations;

•        Proposal 2E — to allow officers of Verde Clean Fuels to be exculpated from personal monetary liability pursuant to the General Corporation Law of the State of Delaware; and

•        Proposal 2F — to provide that holders of Class A Common Stock and holders of Class C Common Stock will vote together as a single class on all matters, except as required by law or by our Proposed Fourth A&R Charter.

•        The Nasdaq Proposal — To consider and vote upon a proposal to approve, for purposes of complying with applicable listing rules of the Nasdaq Capital Market, (a) the issuance of 22,500,000 shares of Class C Common Stock pursuant to the Business Combination Agreement, (b) the issuance of 22,500,000 shares of Class A Common Stock upon the exchange of the Class C OpCo Units, together with an equal number of shares of Class C Common Stock, for shares of Class A Common Stock pursuant to the amended and restated limited liability company agreement of OpCo (the “OpCo A&R LLC Agreement”) and the Proposed Fourth A&R Charter and (c) the issuance and sale of 8,000,000 shares of Class A Common Stock in the private offering of securities to certain investors (the “Nasdaq Proposal”) (Proposal No. 3).

•        The 2023 Plan Proposal — To consider and vote upon a proposal to approve and adopt the Verde Clean Fuels, Inc. 2023 Omnibus Incentive Plan (the “2023 Plan”) (the “2023 Plan Proposal”) (Proposal No. 4). A copy of the 2023 Plan is attached to this proxy statement as Annex C.

•        The Director Election Proposal — To consider and vote upon a proposal to elect two directors to serve until the 2023 annual meeting of stockholders, two directors to serve until the 2024 annual meeting of stockholders and three directors to serve until the 2025 annual meeting of stockholders, and until their respective successors are duly elected and qualified, subject to such directors’ earlier death, resignation, retirement, disqualification or removal (the “Director Election Proposal”) (Proposal No. 5).

•        The Adjournment Proposal — To consider and vote upon a proposal to approve the adjournment of the special meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Business Combination Proposal, the Charter Proposal, the Nasdaq Proposal, the 2023 Plan Proposal or the Director Election Proposal (the “Adjournment Proposal” and, together with the Business Combination Proposal, the Charter Proposal, the Nasdaq Proposal, the 2023 Plan Proposal and the Director Election Proposal, the “Proposals”) (Proposal No. 6).

In connection with the Closing, CENAQ will change its name to Verde Clean Fuels, Inc. (“Verde Clean Fuels”). The combined company will be organized in an “Up-C” structure and the only direct assets of Verde Clean Fuels will consist of equity interests in OpCo, whose only direct assets will consist of equity interests in Intermediate. Immediately following the Closing, Verde Clean Fuels will be the sole manager of and control OpCo, will own 100% of the outstanding Class A OpCo Units and is expected to own between approximately 35.37% and 55.06% of the outstanding OpCo Units. Further, Holdings will own 100% of the outstanding Class C OpCo Units and shares of Class C Common Stock and is expected to own between approximately 44.94% and 64.63% of the outstanding OpCo Units and between approximately 46.54% and 66.93% of the voting power of Verde Clean Fuels (which includes the 800,000 shares of Class A Common Stock purchased by Holdings in the private offering of securities of Verde Clean Fuels to certain investors in connection with the business combination (the “PIPE Financing”)).

Each share of Class C Common Stock has no economic rights but entitles its holder to one vote on all matters to be voted on by stockholders generally. Holders of shares of Class A Common Stock and shares of Class C Common Stock will vote together as a single class on all matters presented to our stockholders for their vote or approval, except as otherwise required by applicable law or by our Proposed Fourth A&R Charter. We do not intend to list any shares of Class C Common Stock on any exchange.

Following this Closing, under the OpCo A&R LLC Agreement, each OpCo unitholder (excluding us) will, subject to certain timing procedures and other conditions set forth therein, have the right (the “OpCo Exchange Right”) to exchange all or a portion of its Class C OpCo Units for, at OpCo’s election, (i) shares of our Class A Common Stock at an exchange ratio of one share of Class A Common Stock for each Class C OpCo Unit exchanged, subject to conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar transactions, or (ii) an equivalent amount of cash. OpCo will determine whether to pay cash in lieu of the issuance of shares of Class A Common Stock based on facts in existence at the time of the decision, which we expect would include the relative value of the Class A Common Stock (including trading prices for the Class A Common Stock at the time), the cash purchase price, the availability of other sources of liquidity (such as an issuance of stock) to acquire the Class C OpCo Units and alternative uses for such cash. Additionally, Verde Clean Fuels will have the right to require, (i) upon a change of control of Verde Clean Fuels or (ii) in the discretion of Verde Clean Fuels with the consent of at least fifty percent (50%) of the holders of Class C OpCo Units, each other OpCo unitholder to exchange all of its Class C OpCo Units (a “Mandatory Exchange”).

Upon the exercise of the OpCo Exchange Right or a Mandatory Exchange, Verde Clean Fuels (instead of OpCo) will have the right, which we refer to as the “Call Right,” to, for administrative convenience, acquire each tendered Class C OpCo Unit directly from the OpCo unitholder for, at its election, (x) one share of Class A Common Stock, subject to conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar transactions, or (y) an equivalent amount of cash, and such Class C OpCo Units shall be automatically recapitalized into the same number of Class A OpCo Units. In connection with any exchange of Class C OpCo Units pursuant to the OpCo Exchange Right or acquisition of Class C OpCo Units pursuant to a Mandatory Exchange or the Call Right, a corresponding number of shares of Class C Common Stock held by the relevant OpCo unitholder will be cancelled. See “Proposal No. 1 — The Business Combination Proposal — Related Documents — OpCo A&R LLC Agreement.”

Verde Clean Fuels’ acquisition (or deemed acquisition for U.S. federal income tax purposes) of Class C OpCo Units pursuant to an exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right is expected to result in adjustments to the tax basis of the tangible and intangible assets of OpCo, and such adjustments will generally be allocated to Verde Clean Fuels. These adjustments would not have been available to Verde Clean Fuels absent its acquisition or deemed acquisition of Class C OpCo Units and are expected to reduce the amount of cash tax that Verde Clean Fuels would otherwise be required to pay in the future.

At the Closing Verde Clean Fuels will enter into a tax receivable agreement (the “Tax Receivable Agreement”) with Holdings (together with its permitted transferees, the “TRA Holders,” and each a “TRA Holder”) and the “Agent” (as defined in the Tax Receivable Agreement to mean Holdings or such other person designated as such pursuant to the Tax Receivable Agreement), which will generally provide for the payment by Verde Clean Fuels to each TRA Holder of 85% of the net cash savings, if any, in U.S. federal, state and local income tax and franchise tax (computed using simplifying assumptions to address the impact of state and local taxes) that Verde Clean Fuels actually realizes (or is deemed to realize in certain circumstances) in periods after the business combination as a result of (i) certain increases in tax basis that occur as a result of Verde Clean Fuels’ acquisition (or deemed acquisition for U.S. federal income tax purposes) of all or a portion of such TRA Holder’s Class C OpCo Units pursuant to the exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right and (ii) imputed interest deemed to be paid by Verde Clean Fuels as a result of, and additional tax basis arising from, any payments Verde Clean Fuels makes under the Tax Receivable Agreement. The Tax Receivable Agreement contains a payment cap of $50,000,000 (the “Payment Cap”), which applies only to certain payments required to be made in connection with the occurrence of a change of control. The Payment Cap would not be reduced or offset by any amounts previously paid under the Tax Receivable Agreement or any amounts that are required to be paid (but have not yet been paid) for the year in which the change of control occurs or any prior years. Verde Clean Fuels will depend on OpCo to make distributions to Verde Clean Fuels in an amount sufficient to cover Verde Clean Fuels’ obligations under the Tax Receivable Agreement. We will retain the benefit of the remaining 15% of any actual net cash tax savings. For additional information regarding the Tax Receivable Agreement, see “— Risk Factors — Risks Related to CENAQ and the Business Combination” and “Proposal No. 1 — The Business Combination Proposal — Related Documents — Tax Receivable Agreement.”

The special meeting will be completely virtual. There will be no physical meeting location and the special meeting will only be conducted via live webcast at the following address:            .

Only holders of record of CENAQ’s Class A Common Stock and Class B Common Stock at the close of business on            , 2022 are entitled to notice of the special meeting and to vote at the special meeting and any adjournments or postponements thereof. A complete list of CENAQ’s stockholders of record entitled to vote at the special meeting will be available at the special meeting and for ten days before the special meeting at CENAQ’s principal executive offices for inspection by stockholders during ordinary business hours for any purpose germane to the special meeting.

Pursuant to our Charter, we are providing the holders of shares of Class A Common Stock originally sold as part of the units issued in our initial public offering (the “IPO” and such holders, the “Public Stockholders”) with the opportunity to redeem (“Redemption Rights”), upon the Closing, shares of Class A Common Stock then held by them for cash equal to their pro rata share of the aggregate amount on deposit (as of two business days prior to the Closing) in the trust account (the “Trust Account”) that holds the proceeds (including interest not previously released to CENAQ to pay its franchise and income taxes as well as expenses relating to the administration of the Trust Account) from the IPO and a concurrent private placement of warrants to our Sponsor and the underwriters of the IPO (the “underwriters”). For illustrative purposes, based on the fair value of cash and marketable securities held in the Trust Account as of June 30, 2022 of approximately $174.5 million, the estimated per share redemption price would have been approximately $10.11. Public Stockholders may elect to redeem their shares whether or not they are holders as of the record date and whether or not they vote for the Business Combination Proposal. Notwithstanding the foregoing Redemption Rights, a Public Stockholder, together with any of his, her or its affiliates or any other person with whom he, she or it is acting in concert or as a “group” (as defined under Section 13(d)(3) of the Securities Exchange Act of 1934, as amended), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 15% of the outstanding shares of Class A Common Stock sold in the IPO. Holders of the Public Warrants do not have Redemption Rights in connection with the business combination. Our Sponsor, officers and directors and the underwriters have agreed to waive their Redemption Rights in connection with the consummation of the business combination with respect to any shares of Class A Common Stock they may hold. Additionally, our Sponsor and certain qualified institutional buyers or institutional accredited investors that participated in the IPO (the “Anchor Investors”) have agreed to waive their Redemption Rights with respect to the shares of Class B Common Stock, and the shares of Class A Common Stock issued upon the conversion thereof (the “Founder Shares”), they received in the IPO, and our shares of Class B Common Stock will be excluded from the pro rata calculation used to determine the per share redemption price. Currently, our Sponsor and the Anchor Investors own all of the shares of Class B Common Stock, which represent approximately 20% of our outstanding Class A Common Stock and Class B Common Stock. Our Sponsor, officers and directors have agreed to vote any shares of Class A Common Stock and Class B Common Stock, including the Founder Shares, owned by them in favor of the business combination, the underwriters have agreed to vote any shares of Class A Common Stock owned by them in favor of the business combination and the Anchor Investors have agreed to vote the Founder Shares owned by them in favor of the business combination.

We may not consummate the business combination unless the Business Combination Proposal, the Charter Proposal and the Nasdaq Proposal are approved at the special meeting. The Charter Proposal, the 2023 Plan Proposal and the Director Election Proposal are conditioned on the approval of the Business Combination Proposal and the Nasdaq Proposal. The Adjournment Proposal is not conditioned on the approval of any other Proposal set forth in the accompanying proxy statement.

Your attention is directed to the proxy statement accompanying this notice (including the annexes thereto) for a more complete description of the proposed business combination and related transactions and each of our Proposals. We encourage you to read the accompanying proxy statement carefully. If you have any questions or need assistance voting your shares, please call our proxy solicitor, Morrow Sodali LLC, at (800) 662-5200 (banks and brokers call collect at (203) 658-9400).

          , 2022

By Order of the Board of Directors

J. Russell Porter

Chief Executive Officer and Director

TABLE OF CONTENTS

CERTAIN DEFINED TERMS

Unless the context otherwise requires, references in this proxy statement to:

•        “$15.00 Triggering Event” or “Triggering Event I” are to the date on which the volume-weighted average price of one share of Class A Common Stock is greater than or equal to $15.00 for any 20 trading days within any period of 30 consecutive trading days within the Earn Out Period; provided that the $15.00 Triggering Event shall have occurred if, during the Earn Out Period, there is a Company Sale pursuant to which the holders of Class A Common Stock have the right to receive consideration implying a value for the Class A Common Stock (as determined in good faith by the Verde Clean Fuels Board) of greater than or equal to $15.00;

•        “$18.00 Triggering Event” or “Triggering Event II” are to the date on which the volume-weighted average price of one share of Class A Common Stock is greater than or equal to $18.00 for any 20 trading days within any period of 30 consecutive trading days within the Earn Out Period; provided that the $18.00 Triggering Event shall have occurred if, during the Earn Out Period, there is a Company Sale pursuant to which the holders of Class A Common Stock have the right to receive consideration implying a value for the Class A Common Stock (as determined in good faith by the Verde Clean Fuels Board) of greater than or equal to $18.00;

•        “Anchor Investors” are to certain qualified institutional buyers or institutional accredited investors that participated in the IPO which are not affiliated with CENAQ, its Sponsor, its directors or any member of its management, and that will own 825,000 shares of Class A Common Stock following the Closing;

•        “ASC” are to Accounting Standards Codification;

•        “business combination” are to the transactions contemplated by the Business Combination Agreement;

•        “Business Combination Agreement” are to that certain Business Combination Agreement and Plan of Reorganization, dated as of August 12, 2022, by and among CENAQ, OpCo, Holdings, Intermediate and the Sponsor (solely with respect to Section 6.18 thereto), as the same may be amended, supplemented or modified;

•        “CENAQ,” “we,” “our,” “us” or the “Company” are to CENAQ Energy Corp., a Delaware corporation;

•        “CENAQ Board” are to the board of directors of CENAQ;

•        “Charter” are to CENAQ’s Third Amended and Restated Certificate of Incorporation;

•        “Class A Common Stock” are to (a) prior to giving effect to the business combination, CENAQ’s Class A Common Stock, par value $0.0001 per share, and (b) after giving effect to the business combination, Verde Clean Fuels’ Class A Common Stock, par value $0.0001 per share;

•        “Class A OpCo Units” are to the Class A common units of OpCo;

•        “Class B Common Stock” are to CENAQ’s Class B Common Stock, par value $0.0001 per share;

•        “Class C Common Stock” are to Verde Clean Fuels’ Class C Common Stock, par value $0.0001 per share, as described in the Proposed Fourth A&R Charter;

•        “Class C OpCo Units” are to the Class C common units of OpCo;

•        “Closing” are to the closing of the business combination;

•        “Closing Date” are to the date on which the Closing occurs;

•        “Code” are to Internal Revenue Code of 1986, as amended;

•        “Company Sale” are to any transaction or series of transactions (a) following which a person or “group” (within the meaning of Section 13(d) of the Exchange Act) of persons (other than Holdings, Verde Clean Fuels, OpCo or any of their respective subsidiaries), obtains direct or indirect beneficial ownership of securities (or rights convertible or exchangeable into securities) representing 50% or more of the

voting power of or economic rights or interests in Verde Clean Fuels or OpCo, (b) constituting a merger, consolidation, reorganization or other business combination, however effected, following which either (1) the members of the Verde Clean Fuels Board immediately prior to such merger, consolidation, reorganization or other business combination do not constitute at least a majority of the board of directors of the company surviving the combination or, if the surviving company is a subsidiary, the ultimate parent thereof or (2) the voting securities of Verde Clean Fuels immediately prior to such merger, consolidation, reorganization or other business combination do not continue to represent or are not converted into 50% or more of the combined voting power of the then outstanding voting securities of the person resulting from such combination or, if the surviving company is a subsidiary, the ultimate parent thereof or (c) the result of which is a sale of all or substantially all of the assets of Verde Clean Fuels to any person;

•        “Controlled Company Event” are to such time that Verde Clean Fuels is no longer a “Controlled Company” pursuant to Nasdaq Listing Rule 5615(c)(1);

•        “DGCL” are to the General Corporation Law of the State of Delaware;

•        “Earn Out Equity” are to up to 3,500,000 Class C OpCo Units and 3,500,000 shares of Class C Common Stock that may be transferred from OpCo to Holdings within five business days after the occurrence of a Triggering Event;

•        “Earn Out Period” are to the period beginning on the Closing Date and ending on the earlier of the five year anniversary of such date or the date a Company Sale is consummated;

•        “Exchange Act” are to the Securities Exchange Act of 1934, as amended;

•        “Founder Incentive Units” are to 1,000 incentive units issued by Holdings on August 7, 2020 to certain members of management of Intermediate in compensation for their services;

•        “Founder Shares” are to the outstanding shares of our Class B Common Stock, and the shares of our Class A Common Stock issued upon the conversion thereof;

•        “GAAP” are to U.S. generally accepted accounting principles;

•        “Holdings” are to Bluescape Clean Fuels Holdings, LLC, a Delaware limited liability company;

•        “Holdings Class C Shares” are to 22,500,000 shares of Class C Common Stock;

•        “Holdings OpCo Units” are to 22,500,000 OpCo Units;

•        “Initial Business Combination” are to our initial merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses;

•        “Initial Public Offering” or “IPO” are to CENAQ’s initial public offering of units, which closed on August 17, 2021;

•        “IRS” are to the U.S. Internal Revenue Service;

•        “Intermediate” are to Bluescape Clean Fuels Intermediate Holdings, LLC, a Delaware limited liability company;

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

•        “New PIPE Investors” are to the investors in the PIPE Financing;

•        “OpCo” are to Verde Clean Fuels OpCo, LLC, a Delaware limited liability company and a wholly owned subsidiary of CENAQ;

•        “OpCo A&R LLC Agreement” are to the amended and restated limited liability company agreement of OpCo;

•        “OpCo Units” are to the Class A OpCo Units and the Class C OpCo Units, on and after the Closing (after giving effect to the OpCo A&R LLC Agreement);

•        “Payment Cap” are to the payment cap of $50,000,000, which applies only to certain payments required to be paid pursuant to the Tax Receivable Agreement in connection with the occurrence of a change of control (as defined in the Tax Receivable Agreement);

•        “PIPE Financing” are to the private offering of securities of Verde Clean Fuels to certain investors in connection with the business combination;

•        “PIPE Proceeds” are to the proceeds from the PIPE Financing;

•        “PIPE Shares” are to the shares of Class A Common Stock that are issued in the PIPE Financing;

•        “Preferred Stock” are to (a) prior to giving effect to the business combination, CENAQ’s Preferred Stock, par value $0.0001 per share, and (b) after giving effect to the business combination, Verde Clean Fuels’ Preferred Stock, par value $0.0001 per share;

•        “Private Placement Warrants” are to the warrants issued to our Sponsor and the underwriters in a private placement simultaneously with the closing of our IPO;

•        “Proposed Bylaws” are to the proposed amended and restated bylaws of Verde Clean Fuels, which will be effective immediately prior to the completion of the business combination;

•        “Proposed Fourth A&R Charter” are to the proposed fourth amended and restated certificate of incorporation of Verde Clean Fuels, which will be effective immediately prior to the completion of the business combination;

•        “public shares” are to shares of CENAQ’s Class A Common Stock sold as part of the units in the IPO (whether they were purchased in the IPO or thereafter in the open market);

•        “Public Stockholders” are to the holders of CENAQ’s public shares;

•        “Public Warrants” are to the warrants sold as part of the units in the IPO (whether they were purchased in the IPO or thereafter in the open market);

•        “Redemption Rights” are to the redemption rights of CENAQ stockholders provided for in Section 9.2 of Article IX of the Charter;

•        “Sarbanes-Oxley Act” are to the Sarbanes-Oxley Act of 2002, as amended;

•        “SEC” are to the U.S. Securities and Exchange Commission;

•        “Securities Act” are to the Securities Act of 1933, as amended;

•        “Series A Incentive Units” are to 800 incentive units issued by Holdings on August 7, 2020 to certain members of management of Intermediate in compensation for their services;

•        “SPAC Stockholder Redemption Amount” are to the aggregate amount of cash proceeds required to satisfy any exercise by the Public Stockholders of their Redemption Rights pursuant to and in accordance with the Charter;

•        “SPAC VWAP” are to the volume-weighted average share price of Class A Common Stock as displayed on CENAQ’s page on Bloomberg (or any successor service) in respect of the period from 9:30 a.m. to 4:00 p.m., New York City time, on the applicable trading day;

•        “special meeting” are to the special meeting of stockholders of CENAQ that is the subject of this proxy statement and any adjournments or postponements thereof;

•        “Sponsor” are to CENAQ Sponsor LLC, a Delaware limited liability company, that will own 3,487,500 shares of Class A Common Stock following Closing;

•        “Sponsor Earn Out” are to the 3,234,375 Founder Shares held by the Sponsor immediately prior to Closing, which will convert into 3,234,375 shares of Class A Common Stock at Closing, (a) 50% of which will be subject to forfeiture until the occurrence of the $15.00 Triggering Event and (b) 50% of which will be subject to forfeiture until the occurrence of the $18.00 Triggering Event;

•        “Sponsor Forfeited Warrants” are to 2,475,000 Private Placement Warrants of the Sponsor that will be forfeited at the Closing;

•        “Sponsor Letter” are to that certain letter agreement, dated as of August 12, 2022, by and among the Sponsor, Intermediate, Holdings and CENAQ;

•        “Triggering Events” are to Triggering Event I and Triggering Event II, respectively;

•        “Trust Account” are to the trust account that holds the proceeds (including interest not previously released to CENAQ to pay its franchise and income taxes as well as expenses relating to the administration of the trust account) from the IPO and the concurrent private placement of Private Placement Warrants;

•        “underwriters” are to Imperial Capital, LLC and I-Bankers Securities, Inc.;

•        “Underwriters Forfeited Shares” are to the 189,750 shares of Class A Common Stock issued to the underwriters in our IPO that will be forfeited at the Closing;

•        “Underwriters Forfeited Warrants” are to 1,725,000 Private Placement Warrants of the underwriters that will be forfeited at the Closing;

•        “Underwriters Letter” are to that certain letter agreement, dated as of August 12, 2022, by and among CENAQ, Holdings, Intermediate and the underwriters, pursuant to which the underwriters have agreed to forfeit the Underwriters Forfeited Shares and the Underwriters Forfeited Warrants and to reduce their deferred underwriting fees related to the IPO from $6,037,500 to $4,312,500;

•        “units” are to the units sold in the IPO, each of which consists of one share of Class A Common Stock and three-quarters of one Public Warrant;

•        “U.S. GAAP” are to the accounting principles generally accepted in the United States of America.

•        “Verde Clean Fuels” are to (a) prior to giving effect to the business combination, CENAQ, and (b) after giving effect to the business combination, Verde Clean Fuels, Inc., the new name of CENAQ after giving effect to the business combination;

•        “Verde Clean Fuels Board” are to the board of directors of Verde Clean Fuels; and

•        “voting common stock” are to (a) prior to giving effect to the business combination, Class A Common Stock and Class B Common Stock, and (b) after giving effect to the business combination, Class A Common Stock and Class C Common Stock.

Unless otherwise specified, the voting and economic interests of CENAQ stockholders set forth in this proxy statement assume the following:

•        no Public Stockholders elect to have their public shares redeemed;

•        8,000,000 shares of Class A Common Stock are issued in the PIPE Financing;

•        at Closing, 22,500,000 shares of Class C Common Stock are issued in connection with the business combination;

•        189,750 Underwriters Forfeited Shares are forfeited by the underwriters at Closing;

•        1,725,000 Underwriters Forfeited Warrants and 2,475,000 Private Placement Warrants held by the Sponsor are forfeited at Closing;

•        none of the Sponsor, Holdings or the New PIPE Investors purchase shares of Class A Common Stock in the open market; and

•        that there are no other issuances of equity interests of CENAQ or Intermediate prior to or in connection with the Closing.

In accordance with our Charter, shares of Class B Common Stock will automatically convert into shares of Class A Common Stock on a one for one basis upon consummation of the business combination, resulting in the issuance of 4,312,500 shares of Class A Common Stock in the aggregate (of which 3,234,375 shares are subject to forfeiture).

Further, unless otherwise specified, the voting and economic interests of CENAQ stockholders set forth in this proxy statement do not take into account the Private Placement Warrants and Public Warrants, which will remain outstanding following the business combination and may be exercised at a later date.

Certain sections in this proxy statement refer to a maximum redemption scenario. Unless otherwise specified, that scenario assumes for illustrative purposes that 17,250,000 shares of Class A Common Stock are redeemed in connection with the Closing, resulting in an aggregate payment of approximately $174.5 million from the Trust Account. For more information, see the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.”

SUMMARY TERM SHEET

This Summary Term Sheet, together with the sections entitled “Questions and Answers About the Proposals for CENAQ Stockholders” and “Summary of the Proxy Statement,” summarizes certain information contained in this proxy statement, but does not contain all of the information that is important to you. You should read carefully this entire proxy statement, including the attached annexes, for a more complete understanding of the matters to be considered at the special meeting.

•        CENAQ is a blank check company incorporated as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. For more information about CENAQ, see the section entitled “Information About CENAQ.”

•        There are currently 17,439,750 shares of CENAQ’s Class A Common Stock and 4,312,500 shares of CENAQ’s Class B Common Stock issued and outstanding. In addition, there are currently 19,612,500 warrants of CENAQ outstanding, consisting of 12,937,500 Public Warrants and 6,675,000 Private Placement Warrants. Each whole warrant entitles the holder to purchase one whole share of Class A Common Stock for $11.50 per share. The warrants will become exercisable 30 days after the completion of an Initial Business Combination and will expire five years after the completion of an Initial Business Combination or earlier upon redemption or liquidation. Once the warrants become exercisable, CENAQ may redeem the warrants in certain circumstances. See the section entitled “Description of Securities — Warrants.”

•        Intermediate is a developer of an innovative and proprietary liquid fuels technology, the syngas to gasoline plus other products (“STG+”) process, which is designed to produce liquid hydrocarbons from synthesis gas, or syngas, derived from renewable feedstocks such as biomass and municipal solid waste (“MSW”) as well as natural gas (including synthetic natural gas) and other feedstocks. For more information about Intermediate, see the sections entitled “Information About Intermediate” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Intermediate.”

•        On August 12, 2022, we and our wholly owned subsidiary, OpCo, entered into the Business Combination Agreement with Intermediate, Holdings and Sponsor (solely with respect to Section 6.18 thereto). A copy of the Business Combination Agreement is attached to this proxy statement as Annex A.

•        Pursuant to the Business Combination Agreement, and subject to the terms and conditions contained therein, (i) (A) CENAQ will contribute to OpCo (1) all of its assets (excluding its interests in OpCo and the SPAC Stockholder Redemption Amount) and (2) the Holdings Class C Shares and (B) in exchange therefor, OpCo will issue to CENAQ a number of Class A OpCo Units equal to the number of total shares of Class A Common Stock issued and outstanding immediately after the Closing (taking into account the PIPE Financing and following the exercise of Redemption Rights) (such transactions, the “SPAC Contribution”) and (ii) immediately following the SPAC Contribution, (A) Holdings will contribute to OpCo 100% of the issued and outstanding limited liability company interests of Intermediate and (B) in exchange therefor, OpCo will transfer to Holdings (1) the Holdings OpCo Units and the Holdings Class C Shares (such transactions, the “Holdings Contribution”). For more information about the Business Combination Agreement and the business combination, see the section entitled “Proposal No. 1 — The Business Combination Proposal.”

•        The Closing is subject to the satisfaction (or waiver) of a number of conditions set forth in the Business Combination Agreement, including, among others, receipt of the requisite stockholder approval of the Business Combination Agreement and the business combination as contemplated by this proxy statement. For more information about the closing conditions to the business combination, see the section entitled “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement — Conditions to Closing.”

•        The Business Combination Agreement may be terminated at any time prior to the consummation of the business combination upon mutual written consent of CENAQ and Intermediate, or for other reasons in specified circumstances. For more information about the termination rights under the Business Combination Agreement, see the section entitled “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement — Termination.”

•        The proposed business combination involves numerous risks. For more information about these risks, please see the section entitled “Risk Factors.”

•        In connection with the execution of the Business Combination Agreement, CENAQ entered into separate agreements with the Sponsor and the underwriters pursuant to which the Sponsor and the underwriters agreed to certain terms regarding the treatment of their CENAQ securities. For more information about the Sponsor Letter and the Underwriters Letter, see the section entitled “Proposal No. 1 — The Business Combination Proposal — Related Documents.”

•        Pursuant to the PIPE Financing, we have agreed to issue and sell to certain investors, and those investors have agreed to buy from us, in connection with the Closing, an aggregate of 8,000,000 shares of Class A Common Stock at a purchase price of $10.00 per share for an aggregate commitment of $80,000,000. Of the $80,000,000 of commitments, Holdings has agreed to purchase 800,000 shares to be sold in the PIPE Financing for an aggregate commitment of $8,000,000 and Arb Clean Fuels Management LLC, a Texas limited liability company affiliated with a member of our Sponsor (“Arb”), has agreed to purchase 7,000,000 shares to be sold in the PIPE Financing for an aggregate commitment of $70,000,000, subject to certain conditions. The Class A Common Stock to be sold in the PIPE Financing would be valued at approximately $            , based on the closing price of our Class A Common Stock of $            per share on            , 2022. CENAQ may enter into additional subscription agreements following the date of the Business Combination Agreement without the prior written consent of Intermediate until October 11, 2022, after which time the prior written consent of Intermediate shall be required.

•        Following the Closing, within five business days after the occurrence of a Triggering Event, CENAQ shall cause OpCo to transfer to Holdings, (a) 1,750,000 units and shares, as applicable, of Earn Out Equity upon the occurrence of Triggering Event I and (b) 1,750,000 units and shares, as applicable, of Earn Out Equity upon the occurrence of Triggering Event II. For more information about the Earn Out Equity, see the section entitled “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement — Earn Out Equity.”

•        Under our Charter, in connection with the business combination, our Public Stockholders may elect to have their shares redeemed for cash at the applicable redemption price per share calculated in accordance with our Charter. As of June 30, 2022, this would have amounted to approximately $10.11 per share. If a holder exercises its Redemption Rights, then such holder will be exchanging its public shares for cash and will no longer own shares of CENAQ following the completion of the business combination and will not participate in the future growth of Verde Clean Fuels, if any. Such a holder will be entitled to receive cash for its public shares only if it properly demands redemption and delivers its shares (either physically or electronically) to our transfer agent at least two business days prior to the special meeting. For more information regarding these procedures, see the section entitled “Special Meeting of CENAQ Stockholders — Redemption Rights.”

•        We anticipate that, upon the Closing, the ownership of Verde Clean Fuels will be as follows if we assume the no redemptions scenario and maximum redemptions scenario as described under the section entitled “Unaudited Pro Forma Condensed Combined Financial Information”:

____________

(1)      Assumes that no Public Stockholders exercise Redemption Rights with respect to their Class A Common Stock for a pro rata share of the funds in the Trust Account. Also assumes that no Public Warrants or Private Placement Warrants are exercised following Closing.

(2)      Assumes that all Public Stockholders, holding all 17,250,000 shares of Class A Common Stock, will exercise their Redemption Rights for an aggregate payment of $174.5 million (based on the estimated per share redemption price of approximately $10.11 per share) from the Trust Account. Also assumes that no Public Warrants or Private Placement Warrants are exercised following Closing.

(3)      Excludes 189,750 Underwriters Forfeited Shares owned by Imperial Capital, LLC and I-Bankers Securities, Inc. that will be forfeited as of Closing pursuant to the Underwriters Letter.

(4)      Represents the shares of Class C Common Stock to be received by Holdings pursuant to the business combination at the Closing and excludes (i) the 800,000 shares of Class A Common Stock that may be issued in the PIPE Financing and (ii) the 3,500,000 shares of Class C Common Stock that may be issued to Holdings upon the occurrence of the Triggering Events.

(5)      Represents 800,000 shares of Class A Common Stock to be acquired by Holdings in the PIPE Financing.

(6)      Arb represents $70,000,000 of the $72,000,000 in the PIPE commitments (excluding Holdings) and will have its PIPE commitment reduced at Closing to the extent CENAQ’s Public Stockholders do not exercise their Redemption Rights. To the extent funds contained in the Trust Account immediately prior to the Closing (after giving effect to the exercise of Redemption Rights) exceed $17,420,000 (the “Trust Threshold”), each $10.00 increment of such excess funds shall reduce Arb’s commitment by $10.00 up to a maximum reduction of $20,000,000 (and in no event less than $50,000,000) resulting in $52,000,000 of PIPE commitments in the Assuming No Redemptions scenario. Excludes 800,000 shares of Class A Common Stock to be acquired by Holdings in the PIPE Financing.

(7)      Includes 253,125 and 825,000 shares of Class A Common Stock to be issued to the Sponsor and Anchor Investors, respectively, upon conversion of a portion of their current Class B Common Stock at Closing. Excludes 3,234,375 shares of Class A Common Stock issued to the Sponsor upon conversion of the remaining portion of its Class B Common Stock at Closing that are subject to forfeiture.

(8)      Includes 3,234,375 shares of Class A Common Stock issued to the Sponsor that are subject to forfeiture pursuant to the Sponsor Letter, but that will have voting rights and rights to receive dividends prior to any forfeiture. These shares will no longer be subject to forfeiture upon the occurrence of the Triggering Events.

(9)      Excludes a total of 4,200,000 Private Placement Warrants to be forfeited as of Closing comprised of 2,475,000, 1,423,125 and 301,875 held by the Sponsor, Imperial Capital, LLC and I-Bankers Securities, Inc., respectively.

(10)    Includes 3,500,000 shares of Class C Common Stock issuable to Holdings upon the occurrence of the Triggering Events.

As a result of the business combination, the economic and voting interests of our Public Stockholders will decrease.

The Public Warrants and Private Placement Warrants will become exercisable 30 days after the completion of an Initial Business Combination and will expire five years after the completion of an Initial Business Combination or earlier upon their redemption or liquidation.

Please see the sections entitled “Summary of the Proxy Statement — Ownership of Verde Clean Fuels After the Closing” and “Unaudited Pro Forma Condensed Combined Financial Information” for further information.

•        The CENAQ Board considered various factors in determining whether to approve the Business Combination Agreement and the business combination. For more information about the CENAQ Board’s decision-making process, see the section entitled “Proposal No. 1 — The Business Combination Proposal — CENAQ Board’s Consideration of and Reasons for Approving the Business Combination.”

•        In addition to voting on the proposal to approve and adopt the Business Combination Agreement and the business combination (the “Business Combination Proposal”) at the special meeting, CENAQ’s stockholders will also be asked to vote on:

•        the approval and adoption of the Proposed Fourth A&R Charter (the “Charter Proposal”);

•        in addition to the approval of the Proposed Fourth A&R Charter, the stockholders are also separately being presented with the following proposals (the “Advisory Charter Proposals”), for approval on a non-binding advisory basis: (A) to increase the number of authorized shares of CENAQ’s capital stock, par value $0.0001 per share, from 221,000,000 shares, consisting of (a) 220,000,000 shares of common stock, including 200,000,000 shares of Class A Common Stock and 20,000,000 shares of Class B Common Stock, and (b) 1,000,000 shares of Preferred Stock, to 376,000,000 shares, consisting of (i) 350,000,000 shares of Class A Common Stock, (ii) 25,000,000 shares of Class C Common Stock and (ii) 1,000,000 shares of Preferred Stock; (B) to remove certain provisions in the Charter relating to CENAQ’s Initial Business Combination and provisions applicable only to blank check companies that will no longer be applicable to CENAQ following the Closing; (C) to allow stockholders to call special meetings and act by written consent until the Controlled Company Event; (D) to absolve certain Verde Clean Fuels stockholders from certain competition and corporate opportunities obligations; (E) to allow officers of Verde Clean Fuels to be exculpated from personal monetary liability pursuant to the DGCL; and (F) to provide that holders of Class A Common Stock and holders of Class C Common Stock will vote together as a single class on all matters, except as required by law or by our Proposed Fourth A&R Charter;

•        for purposes of complying with applicable listing rules of the Nasdaq Capital Market, (a) the issuance of 22,500,000 shares of Class C Common Stock pursuant to the Business Combination Agreement, (b) the issuance of shares of Class A Common Stock upon the exchange of Class C OpCo Units, together with an equal number of shares of Class C Common Stock, for shares of Class A Common Stock pursuant to the OpCo A&R LLC Agreement and the Proposed Fourth A&R Charter and (c) the issuance and sale of 8,000,000 shares of Class A Common Stock in the PIPE Financing (the “Nasdaq Proposal”);

•        the Verde Clean Fuels, Inc. 2023 Omnibus Incentive Plan (the “2023 Plan”) (the “2023 Plan Proposal”);

•        the election of two directors to serve until the 2023 annual meeting of stockholders, two directors to serve until the 2024 annual meeting of stockholders and three directors to serve until the 2025 annual meeting of stockholders, and until their respective successors are duly elected and qualified, subject to such directors’ earlier death, resignation, retirement, disqualification or removal (the “Director Election Proposal”); and

QUESTIONS AND ANSWERS ABOUT THE PROPOSALS FOR CENAQ STOCKHOLDERS

The following questions and answers briefly address some commonly asked questions about the Proposals to be presented at the special meeting of stockholders of CENAQ, including the proposed business combination. The following questions and answers do not include all the information that is important to CENAQ stockholders. We urge CENAQ stockholders to carefully read this entire proxy statement, including the annexes and other documents referred to herein.

Q:     Why am I receiving this proxy statement?

A:     CENAQ stockholders are being asked to consider and vote upon, among other things, a proposal to (a) approve and adopt the Business Combination Agreement, pursuant to which (i) (A) CENAQ will contribute to OpCo (1) all of its assets (excluding its interests in OpCo and the SPAC Stockholder Redemption Amount) and (2) the Holdings Class C Shares and (B) in exchange therefor, OpCo will issue to CENAQ a number of Class A OpCo Units equal to the number of total shares of Class A Common Stock issued and outstanding immediately after the Closing (taking into account the PIPE Financing and following the exercise of Redemption Rights) and (ii) immediately following the SPAC Contribution, (A) Holdings will contribute to OpCo 100% of the issued and outstanding limited liability company interests of Intermediate and (B) in exchange therefor, OpCo will transfer to Holdings (1) the Holdings OpCo Units and the Holdings Class C Shares, (b) approve the business combination and the other transactions contemplated by the Business Combination Agreement and (c) approve, for purposes of complying with applicable listing rules of the Nasdaq Capital Market, (i) the issuance of 22,500,000 shares of Class C Common Stock pursuant to the Business Combination Agreement, (ii) the issuance of 22,500,000 shares of Class A Common Stock as a result of the right to convert shares of Class C Common Stock, together with an equal number of Class C OpCo Units, into shares of Class A Common Stock pursuant to the OpCo A&R LLC Agreement and the Proposed Fourth A&R Charter and (iii) the issuance and sale of 8,000,000 shares of Class A Common Stock in the PIPE Financing.

A copy of the Business Combination Agreement is attached to this proxy statement as Annex A. This proxy statement and its annexes contain important information about the proposed business combination and the other matters to be acted upon at the special meeting. You should read this proxy statement and its annexes carefully and in their entirety.

Your vote is important. You are encouraged to submit your proxy as soon as possible after carefully reviewing this proxy statement and its annexes.

Q:     What is being voted on at the special meeting?

A:     CENAQ stockholders will vote on the following proposals at the special meeting.

•        The Business Combination Proposal — To consider and vote upon a proposal to approve and adopt the Business Combination Agreement and the transactions contemplated thereby (Proposal No. 1).

•        The Charter Proposal — To consider and vote upon a proposal to approve and adopt, assuming the Business Combination Proposal and the Nasdaq Proposal are approved and adopted, the Proposed Fourth A&R Charter, a copy of the form of which is attached to the accompanying proxy statement as Annex B (Proposal No. 2), which, if approved, would take effect upon Closing.

In addition to the approval of the Proposed Fourth A&R Charter, the stockholders are also separately being presented with the following Advisory Charter Proposals, for approval on a non-binding advisory basis, to give stockholders the opportunity to present their separate views on certain corporate governance provisions in the Proposed Fourth A&R Charter:

•        Proposal 2A — to increase the number of authorized shares of CENAQ’s capital stock, par value $0.0001 per share, from 221,000,000 shares, consisting of (a) 220,000,000 shares of common stock, including 200,000,000 shares of Class A Common Stock and 20,000,000 shares of Class B Common Stock, and (b) 1,000,000 shares of Preferred Stock, to 376,000,000 shares, consisting of (i) 350,000,000 shares of Class A Common Stock, (ii) 25,000,000 shares of Class C Common Stock and (iii) 1,000,000 shares of Preferred Stock;

•        Proposal 2B — to remove certain provisions in the Charter relating to CENAQ’s Initial Business Combination and provisions applicable only to blank check companies that will no longer be applicable to CENAQ following the Closing;

•        Proposal 2C — to allow stockholders to call special meetings and act by written consent until the Controlled Company Event;

•        Proposal 2D — to absolve certain Verde Clean Fuels stockholders from certain competition and corporate opportunities obligations;

•        Proposal 2E — to allow officers of Verde Clean Fuels to be exculpated from personal monetary liability pursuant to the DGCL; and

•        Proposal 2F — to provide that holders of Class A Common Stock and holders of Class C Common Stock will vote together as a single class on all matters, except as required by law or by our Proposed Fourth A&R Charter.

•        The Nasdaq Proposal — To consider and vote upon a proposal to approve, for purposes of complying with applicable listing rules of the Nasdaq Capital Market, (a) the issuance of 22,500,000 shares of Class C Common Stock pursuant to the Business Combination Agreement, (b) the issuance of 22,500,000 shares of Class A Common Stock upon the exchange of the Class C OpCo Units, together with an equal number of shares of Class C Common Stock, for shares of Class A Common Stock pursuant to the OpCo A&R LLC Agreement and the Proposed Fourth A&R Charter and (c) the issuance and sale of 8,000,000 shares of Class A Common Stock in the PIPE Financing (Proposal No. 3).

•        The 2023 Plan Proposal — To consider and vote upon a proposal to approve and adopt the 2023 Plan (Proposal No. 4). A copy of the 2023 Plan is attached to this proxy statement as Annex C.

•        The Director Election Proposal — To consider and vote upon a proposal to elect two directors to serve until the 2023 annual meeting of stockholders, two directors to serve until the 2024 annual meeting of stockholders and three directors to serve until the 2025 annual meeting of stockholders, and until their respective successors are duly elected and qualified, subject to such directors’ earlier death, resignation, retirement, disqualification or removal (Proposal No. 5).

•        The Adjournment Proposal — To consider and vote upon a proposal to approve the adjournment of the special meeting to a later date or dates, if necessary or appropriate, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Business Combination Proposal, the Charter Proposal, the Nasdaq Proposal, the 2023 Plan Proposal or the Director Election Proposal (Proposal No. 6).

Q:     Are the Proposals conditioned on one another?

A:     We may not consummate the business combination unless the Business Combination Proposal, the Charter Proposal and the Nasdaq Proposal are approved at the special meeting. The Charter Proposal, the 2023 Plan Proposal and the Director Election Proposal are conditioned on the approval of the Business Combination Proposal and the Nasdaq Proposal. The Adjournment Proposal is not conditioned on the approval of any other Proposal set forth in this proxy statement.

Q:     What will happen in the business combination?

A:     Pursuant to the Business Combination Agreement, and subject to the terms and conditions contained therein, (i) (A) CENAQ shall contribute to OpCo (1) all of its assets (excluding its interests in OpCo and the SPAC Stockholder Redemption Amount) and (2) the Holdings Class C Shares and (B) in exchange therefor, OpCo shall issue to CENAQ a number of Class A OpCo Units equal to the number of total shares of Class A Common Stock issued and outstanding immediately after the Closing (taking into account the PIPE Financing and following the exercise of Redemption Rights) and (ii) immediately following the SPAC Contribution, (A) Holdings shall contribute to OpCo 100% of the issued and outstanding limited liability company interests of Intermediate and (B) in exchange therefor, OpCo shall transfer to Holdings (1) the Holdings OpCo Units and the Holdings Class C Shares. After giving effect to the business combination, Holdings will hold 22,500,000 OpCo Units and an equal number of shares of Class C Common Stock. For more information about the Business Combination Agreement and the business combination, see the section entitled “Proposal No. 1 — The Business Combination Proposal.”

Q:     What will Holdings receive in the business combination?

A:     Holdings will (i) receive the Holdings OpCo Units and the Holdings Class C Shares and (ii) enter into the Tax Receivable Agreement (as described in the section entitled “Proposal No. 1 — The Business Combination Proposal — Related Documents — Tax Receivable Agreement”).

Q:     What will OpCo receive in the business combination?

A:     OpCo will receive (i) funds in the Trust Account after deduction of the SPAC Stockholder Redemption Amount and (ii) the PIPE Proceeds.

Q:     What is an “Up-C” structure?

A:     The combined company’s structure following the business combination, as described under the subsection entitled “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement — General: Structure of the Business Combination,” is commonly referred to as an “Up-C” structure, which is often used by partnerships and limited liability companies when they undertake an initial public offering either directly or through a business combination with a special purpose acquisition company, such as CENAQ.

Under the combined company “Up-C” structure, the only direct assets of Verde Clean Fuels will consist of equity interests in OpCo, whose only direct assets will consist of equity interests in Intermediate. Immediately following the Closing, Verde Clean Fuels will be the sole manager of and control OpCo and will own 100% of the outstanding Class A OpCo Units. Further, Holdings will hold all of the outstanding Class C OpCo Units and all of the outstanding Class C Common Stock. Each share of Class C Common Stock has no economic rights but entitles holder to one vote on all matters to be voted on by stockholders generally. Holders of shares of Class A Common Stock and shares of Class C Common Stock will vote together as a single class on all matters presented to our stockholders for their vote or approval, except as otherwise required by applicable law or by our Proposed Fourth A&R Charter. We do not intend to list any Class C Common Stock on any exchange.

Following this Closing, under the OpCo A&R LLC Agreement, each OpCo unitholder (excluding us) will, subject to certain timing procedures and other conditions set forth therein, have the right (the “OpCo Exchange Right”) to exchange all or a portion of its Class C OpCo Units for, at OpCo’s election, (i) shares of our Class A Common Stock at an exchange ratio of one share of Class A Common Stock for each Class C OpCo Unit exchanged, subject to conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar transactions, or (ii) an equivalent amount of cash. OpCo will determine whether to pay cash in lieu of the issuance of shares of Class A Common Stock based on facts in existence at the time of the decision, which we expect would include the relative value of the Class A Common Stock (including trading prices for the Class A Common Stock at the time), the cash purchase price, the availability of other sources of liquidity (such as an issuance of stock) to acquire the Class C OpCo Units and alternative uses for such cash. Additionally, Verde Clean Fuels will have the right to require, (i) upon a change of control of Verde Clean Fuels or (ii) in the discretion of Verde Clean Fuels with the consent of at least fifty percent (50%) of the holders of Class C OpCo Units, each other OpCo unitholder to exchange all of its Class C OpCo Units (a “Mandatory Exchange”).

Upon the exercise of the OpCo Exchange Right or a Mandatory Exchange, Verde Clean Fuels (instead of OpCo) will have the right, which we refer to as the “Call Right,” to, for administrative convenience, acquire each tendered Class C OpCo Unit directly from the OpCo unitholder for, at its election, (x) one share of Class A Common Stock, subject to conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar transactions, or (y) an equivalent amount of cash, and such Class C OpCo Units shall be automatically recapitalized into the same number of Class A OpCo Units. In connection with any exchange of OpCo Units pursuant to the OpCo Exchange Right or acquisition of OpCo Units pursuant to a Mandatory Exchange or the Call Right, a corresponding number of shares of Class C Common Stock held by the relevant OpCo unitholder will be cancelled. See “Proposal No. 1 — The Business Combination Proposal — Related Documents — OpCo A&R LLC Agreement.”

Q:     How were the transaction structure and consideration for the business combination determined?

A:     Following the closing of the IPO, CENAQ representatives commenced a robust search for businesses or assets to acquire for the purpose of consummating CENAQ’s Initial Business Combination. From the closing of the IPO on August 17, 2021 to December of 2021, representatives from CENAQ evaluated nine potential targets (including Intermediate). Following a meeting on September 9, 2021 the CENAQ Board decided to focus on the business combination with Intermediate. On October 24, 2021, CENAQ submitted a non-binding letter of intent to Intermediate. On November 11, 2021, a meeting was held in Dallas, Texas at the offices of Bluescape Energy Partners LLC to introduce CENAQ’s management team, certain board members and Sponsor, provide a high-level overview of the transaction, provide metrics for the expected valuation, discuss the PIPE Financing and provide a timeline for the transaction. On November 18, 2021, representatives from CENAQ had a call with representatives from Imperial Capital to discuss the market for a PIPE Financing related to the potential transaction with Intermediate. On November 23, 2021, representatives from CENAQ had a call with representatives from a leading energy investment bank to discuss the proposed business combination between CENAQ and Intermediate, as well as the likelihood of successfully raising additional capital for a transaction and capital markets generally. On December 15, 2021, CENAQ and Intermediate executed the non-binding letter of intent (“LOI”). On July 19, 2022, the CENAQ Board, Ken Morris, representatives from Vinson & Elkins L.L.P., legal counsel to CENAQ (“V&E”), and the leading energy investment bank had a video conference to continue discussing the transaction, including that certain revisions should be made to the LOI to reflect current market considerations. On the morning of July 20, 2022, Intermediate sent CENAQ an updated LOI, which included the following new terms: (i) PIPE Financing of at least $80,000,000; (ii) Bluescape Energy Partners LLC would commit to purchase up to $8,000,000 of the PIPE Financing; (iii) $11,000,000 of the IPO proceeds and PIPE Proceeds would be used for payment of transaction fees of Intermediate, Intermediate’s equityholders and CENAQ; (iv) certain Founder Shares would be subject to vesting (50% at $15.00 per share and 50% at $18.00 per share); and (v) Earn Out Equity of up to 3,500,000 in two tranches (50% at $15.00 per share and 50% at 18.00 per share). During the same week, Russell Porter, on behalf of CENAQ, and Imperial Capital had a call and verbally agreed to the following terms: (i) 2,475,000 Private Placement Warrants held by Sponsor would be forfeited at the Closing for no consideration, and (ii) all of the Private Placement Warrants held by Imperial and I-Bankers Securities Inc. and the 189,740 Underwriter Forfeited Shares would be forfeited at the Closing for no consideration. On July 21, 2022, CENAQ, Sponsor and Intermediate executed the amended LOI. Please see the section entitled “Proposal No. 1 — The Business Combination Proposal — Background of the Business Combination” for additional information.

Q:     What conditions must be satisfied to complete the business combination?

A:     There are several closing conditions in the Business Combination Agreement, including the approval by our stockholders of the Business Combination Proposal. For a summary of the conditions that must be satisfied or waived prior to completion of the business combination, see the section entitled “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement — Conditions to Closing.”

Q:     How will we be managed and governed following the business combination?

Immediately after the Closing, the Verde Clean Fuels Board will be divided into three separate classes, designated as follows:

•        Class I comprised of Graham van’t Hoff and Duncan Palmer;

•        Class II comprised of Curtis Hébert, Jr. and Ron Hulme; and

•        Class III comprised of             ,            and Jonathan Siegler.

The Verde Clean Fuels Board shall designate the Chair of the Board following the Closing.

Please see the section entitled “Management After the Business Combination.”

Q:     Will CENAQ obtain new financing in connection with the business combination?

A:     The New PIPE Investors have committed to purchase from CENAQ 8,000,000 shares of Class A Common Stock, for an aggregate purchase price of $80,000,000 in the PIPE Financing. Of the $80,000,000 of commitments, Holdings has agreed to purchase 800,000 shares to be sold in the PIPE Financing for an

aggregate commitment of $8,000,000, and Arb has agreed to purchase 7,000,000 shares to be sold in the PIPE Financing for an aggregate commitment of $70,000,000, provided, that, to the extent funds in the Trust Account immediately prior to Closing, after giving effect to the exercise of Redemption Rights, exceed the Trust Threshold, each $10.00 increment of such excess funds shall reduce Arb’s commitment by $10.00 up to a maximum reduction of $20.0 million.

Q:     What equity stake will our current stockholders and the holders of our Founder Shares hold in Verde Clean Fuels following the consummation of the business combination?

A:     We anticipate that, upon the Closing, the ownership of Verde Clean Fuels will be as follows:

____________

(1)      Assumes that no Public Stockholders exercise Redemption Rights with respect to their Class A Common Stock for a pro rata share of the funds in the Trust Account. Also assumes that no Public Warrants or Private Placement Warrants are exercised following Closing.

(2)      Assumes that all Public Stockholders, holding all 17,250,000 shares of Class A Common Stock, will exercise their Redemption Rights for an aggregate payment of $174.5 million (based on the estimated per share redemption price of approximately $10.11 per share) from the Trust Account. Also assumes that no Public Warrants or Private Placement Warrants are exercised following Closing.

(3)      Excludes 189,750 Underwriters Forfeited Shares owned by Imperial Capital, LLC and I-Bankers Securities, Inc. that will be forfeited as of Closing pursuant to the Underwriters Letter.

(4)      Represents the shares of Class C Common Stock to be received by Holdings pursuant to the business combination at the Closing and excludes (1) the 800,000 shares of Class A Common Stock that may be issued in the PIPE Financing and (ii) the 3,500,000 shares of Class C Common Stock that may be issued to Holdings upon the occurrence of the Triggering Events.

(5)      Represents 800,000 shares of Class A Common Stock to be acquired by Holdings in the PIPE Financing.

(6)      Arb represents $70,000,000 of the $72,000,000 in the PIPE commitments (excluding Holdings) and will have its PIPE commitment reduced at Closing to the extent CENAQ’s Public Stockholders do not exercise their Redemption Rights. To the extent funds contained in the Trust Account immediately prior to the Closing (after giving effect to the exercise of Redemption Rights) exceed the Trust Threshold, each $10.00 increment of such excess funds shall reduce Arb’s commitment by $10.00 up to a maximum reduction of $20,000,000 (and in no event less than $50,000,000) resulting in $52,000,000 of PIPE commitments in the Assuming No Redemptions scenario. Excludes 800,000 shares of Class A Common Stock to be acquired by Holdings in the PIPE Financing.

(7)      Includes 253,125 and 825,000 shares of Class A Common Stock to be issued to the Sponsor and Anchor Investors, respectively, upon conversion of a portion of their current Class B Common Stock at Closing.

(8)      Includes 3,234,375 shares of Class A Common Stock issued to the Sponsor that are subject to forfeiture pursuant to the Sponsor Letter.

The ownership percentages with respect to Verde Clean Fuels set forth above do not take into account (i) warrants to purchase Class A Common Stock that will remain outstanding immediately following the business combination, and (ii) the issuance of up to 3,500,000 shares of Class C Common Stock upon vesting of the Earn Out Equity shares. If the facts are different than these assumptions, the percentage ownership retained by CENAQ’s existing stockholders in Verde Clean Fuels following the business combination will be different. For example, if we assume that all outstanding 12,937,500 Public Warrants and 2,475,000 Private Placement Warrants (excluding the Sponsor Forfeited Warrants and the Underwriters Forfeited Warrants)

were exercisable and exercised following completion of the business combination and further assume that the 3,500,000 shares of Class C Common Stock upon vesting of the Earn Out Equity shares are vested and outstanding, then the ownership of Verde Clean Fuels would be as follows:

Such amounts may be further diluted by the issuance of Class A Common Stock upon adoption of the 2023 Plan.

The Public Warrants and Private Placement Warrants will become exercisable 30 days after the completion of an Initial Business Combination and will expire five years after the completion of an Initial Business Combination or earlier upon their redemption or liquidation.

Please see the sections entitled “Summary of the Proxy Statement — Ownership of Verde Clean Fuels After the Closing” and “Unaudited Pro Forma Condensed Combined Financial Information” for further information.

Q:     Why is CENAQ proposing the Nasdaq Proposal?

A:     CENAQ is proposing the Nasdaq Proposal in order to comply with listing standards of the Nasdaq Capital Market, which require stockholder approval of certain transactions that result in the issuance of 20% or more of a company’s outstanding voting power or shares of common stock outstanding before the issuance of securities or in a change of control of CENAQ, which will result in a change of control, as required by Section 5635(a) and (b) of Nasdaq Stock Market Rulebook. In connection with the business combination and the PIPE Financing, we will issue 22,500,000 shares of Class C Common Stock pursuant to the Business Combination Agreement, 22,500,000 shares of Class A Common Stock upon the exchange of the Class C OpCo Units, together with an equal number of shares of Class C Common Stock, for shares of Class A Common Stock pursuant to the OpCo A&R LLC Agreement and the Proposed Fourth A&R Charter and 8,000,000 shares of Class A Common Stock to the New PIPE Investors. Because we may issue 20% or more of our outstanding voting power and outstanding common stock in connection with the business combination, we are required to obtain stockholder approval of such issuances pursuant to listing standards of the Nasdaq Capital Market. See the section entitled “Proposal No. 3 — The Nasdaq Proposal” for additional information.

Q:     Did the CENAQ Board obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the business combination?

A:     No. The CENAQ Board did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the business combination. CENAQ’s officers and directors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and concluded that their experience and backgrounds, together with the experience and sector expertise of CENAQ’s advisors, enabled them to make the necessary analyses and determinations regarding the business combination. In addition, CENAQ’s officers, directors and advisors have substantial experience with mergers and acquisitions. Accordingly, investors will be relying solely on the judgment of the CENAQ Board in valuing Intermediate and assuming the risk that the CENAQ Board may not have properly valued the business.

Q:     What are some of the positive and negative factors that the CENAQ Board considered when determining to enter into the Business Combination Agreement and its rationale for approving the transaction?

A:     The factors considered by the CENAQ Board include, but were not limited to, the following:

•        Viable and Demonstrated Technology.    Intermediate has a proprietary and demonstrated technology that is protected by 28 patents issued globally, including 8 patents in the United States, and 3 pending patent applications globally and has a commercial scale demonstration plant that has operated over 10,500 hours;

•        Strong Relationships.    Intermediate’s strong partnerships with certain strategic vendors and suppliers, which it believes will contribute to Intermediate’s ability to successfully develop its planned production facilities;

•        Benefactor of Shift to Renewables.    There is no publicly traded “pure play” company in North America that is producing a renewable gasoline in commercial quantities, positioning Intermediate in a favorable position with the transition toward renewable energy;

•        Experienced Management.    CENAQ’s management and the CENAQ Board believe that Intermediate has a strong management team, with extensive industry experience and proven track record, which is expected to remain with the combined company to seek to execute Intermediate’s strategic and growth goals;

•        Due Diligence.    CENAQ’s management and the CENAQ Board conducted due diligence examinations of Intermediate and discussions with Intermediate’s management and CENAQ’s financial and legal advisors concerning CENAQ’s due diligence examination of Intermediate;

•        Other Alternatives.    The CENAQ Board’s belief, after a thorough review of other business combination opportunities reasonably available to CENAQ, that the proposed combination represents the best potential business combination for CENAQ and the most attractive opportunity for CENAQ based upon the process utilized to evaluate and assess other potential combination targets, and CENAQ Board’s belief that such process has not presented a better alternative; and

•        Negotiated Transaction.    The financial and other terms of the Business Combination Agreement and the fact that such terms and conditions are reasonable and were the product of arm’s-length negotiations between CENAQ and Intermediate.

In addition, the CENAQ Board determined that the business combination satisfies the investment criteria that the CENAQ Board identified in connection with the IPO. For more information, see the section entitled “Proposal No. 1 — The Business Combination Proposal — Background of the Business Combination.”

In the course of its deliberations, the CENAQ Board also considered a variety of uncertainties, risks and other potentially negative factors relevant to the business combination, including the following:

•        Early Stage Company Risk.    The risk that Intermediate is an early-stage company, with a history of financial losses and expects to incur significant expenses and continuing losses for the foreseeable future;

•        Growth Risk.    The risk that Intermediate expects to invest in growth for the foreseeable future, and the risk that Intermediate may fail to manage that growth effectively;

•        Public Company Risk.    The risks that are associated with being a publicly traded company that is in its early, developmental stage;

•        Macroeconomic Risks.    Macroeconomic uncertainty and the effects it could have on the combined company’s revenues;

•        Redemption Risk.    The potential that a significant number of CENAQ’s Public Stockholders elect to redeem their shares prior to the consummation of the business combination and pursuant to the Charter, which would potentially make the business combination more difficult or impossible to complete, and/or reduce the amount of cash available to the combined company following the Closing;

•        Stockholder Vote.    The risk that CENAQ’s stockholders may fail to provide the respective votes necessary to effect the business combination;

•        Closing Conditions.    The fact that the completion of the business combination is conditioned on the satisfaction of certain closing conditions that are not within CENAQ’s control;

•        Litigation.    The possibility of litigation challenging the business combination or that an adverse judgment granting permanent injunctive relief could indefinitely enjoin consummation of the business combination;

•        Benefits May Not Be Achieved.    The risks that the potential benefits of the business combination may not be fully achieved or may not be achieved within the expected timeframe;

•        Fees, Expenses and Time Risk.    The risk of incurring significant fees and expenses associated with completing the business combination and the substantial time and effort of Intermediate management and CENAQ management required to complete the business combination;

•        No Third-Party Valuation.    The risk that CENAQ did not obtain a third-party valuation or fairness opinion in connection with the business combination;

•        Interests of CENAQ’s Directors and Officers.    The interests of the CENAQ Board and officers in the business combination (see “— Interests of Certain Persons in the Business Combination”);

•        Interests of the Financial Advisor.    The interests of the financial advisor in the completion of the business combination, including the fact that the deferred underwriting compensation due to the financial advisor as compensation for their acting as an underwriter in the IPO, potential placement agent’s fees for the PIPE Financing and other fees payable to the financial advisor would only accrue if a business combination was consummated; and

•        Other Risks Factors.    Various other risk factors associated with the energy business, as described in the section entitled “Risk Factors” appearing elsewhere in this proxy statement.

In addition to considering the factors described above, the CENAQ Board also considered that the officers and directors of CENAQ may have interests in the business combination as individuals that are in addition to, and that may be different from, the interests of CENAQ’s stockholders. CENAQ’s independent directors reviewed and considered these interests during the negotiation of the business combination and in evaluating and unanimously approving, as members of the CENAQ Board, the Business Combination Agreement and the business combination. For more information, see the section entitled “Proposal No. 1 — The Business Combination Proposal — Interests of Certain Persons in the Business Combination.”

The CENAQ Board concluded that the potential benefits that it expects CENAQ and its stockholders to achieve as a result of the business combination outweigh the potentially negative factors associated with the business combination. Accordingly, the CENAQ Board, based on its consideration of the specific factors listed above, unanimously (a) determined that the business combination and the other transactions contemplated by the Business Combination Agreement are fair to, and in the best interests of, CENAQ’s stockholders, (b) approved, adopted and declared advisable the Business Combination Agreement and the transactions contemplated thereby and (c) recommended that the stockholders of CENAQ approve each of the Proposals.

The above discussion of the material factors considered by the CENAQ Board is not intended to be exhaustive but does set forth the principal factors considered by the CENAQ Board.

Q:     What happens if I sell my shares of Class A Common Stock before the special meeting?

A:     The record date for the special meeting is earlier than the date that the business combination is expected to be completed. If you transfer your shares of Class A Common Stock after the record date, but before the special meeting, unless the transferee obtains from you a proxy to vote those shares, you will retain your right to vote at the special meeting. However, you will not be able to seek redemption of your shares of Class A Common Stock because you will no longer be able to deliver them for cancellation upon consummation of the business combination in accordance with the provisions described in this proxy statement. If you transfer your shares of Class A Common Stock prior to the record date, you will have no right to vote those shares at the special meeting or seek redemption of those shares.

Q:     How has the announcement of the business combination affected the trading price of CENAQ’s units, Class A Common Stock and warrants?

A:     On August 11, 2022, the last trading date before the public announcement of the business combination, CENAQ’s public units, Class A Common Stock and Public Warrants closed at $10.10, $10.10 and $0.07, respectively. On            , 2022, the trading date immediately prior to the date of this proxy statement, CENAQ’s public units, Class A Common Stock and warrants closed at $            , $            and $            , respectively.

Q:     Following the business combination, will CENAQ’s securities continue to trade on a stock exchange?

A:     Yes. We anticipate that, following the business combination, our Class A Common Stock and Public Warrants will continue trading on the Nasdaq Capital Market under the new symbols “VGAS” and “VGASW,” respectively.

Our units will automatically separate into the component securities upon consummation of the business combination and, as a result, will no longer trade as separate securities following the business combination.

Q:     What vote is required to approve the Proposals presented at the special meeting?

A:     Approval of each of the Business Combination Proposal, the Nasdaq Proposal, the 2023 Plan Proposal and the Adjournment Proposal requires the affirmative vote (online or by proxy) of the holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote and actually cast thereon, voting as a single class. Approval of the Charter Proposal requires the affirmative vote (online or by proxy) of (i) the holders of a majority of the shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class, and (ii) the holders of a majority of the shares of Class A Common Stock entitled to vote thereon at the special meeting. In addition to the approval of the Charter Proposal, you are separately being presented the Advisory Charter Proposals, for approval on a non-binding advisory basis, to give stockholders the opportunity to present their separate view on certain corporate governance provisions in the Proposed Fourth A&R Charter. Approval of the Advisory Charter Proposals requires the affirmative vote (online or by proxy) of the holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote thereon at the special meeting, voting as a single class.

Approval of the Director Election Proposal requires the affirmative vote (online or by proxy) of a plurality of the votes cast by holders of our Class A Common Stock and Class B Common Stock at the special meeting and entitled to vote thereon, voting as a single class. This means that the seven director nominees will be elected if they receive more affirmative votes than any other nominee for the same position.

Stockholders may not cumulate their votes with respect to the election of directors. Assuming a valid quorum is established, abstentions will have no effect on the Director Election Proposal.

Q:     May CENAQ’s Sponsor, directors, officers, advisors or any of their respective affiliates purchase public shares in connection with the business combination?

A:     In connection with the stockholder vote to approve the proposed business combination, our Sponsor, directors, officers, advisors and any of their respective affiliates may privately negotiate to purchase public shares from stockholders who would have otherwise elected to have their shares redeemed in conjunction with a proxy solicitation pursuant to the proxy rules for a per share pro rata portion of the Trust Account. Our Sponsor,

directors, officers, advisors and any of their respective affiliates will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller of such public shares or during a restricted period under Regulation M under the Exchange Act. Such a purchase could include a contractual acknowledgement that such stockholder, although still the record holder of such public shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its Redemption Rights. Any public shares purchased by our Sponsor or its affiliates would not be voted in favor of approving the business combination. In the event that our Sponsor, directors, officers, advisors or any of their respective affiliates purchase public shares in privately negotiated transactions from Public Stockholders who have already elected to exercise their Redemption Rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. In addition, our Sponsor and its affiliates would waive any Redemption Rights with respect to any public shares that they purchase in any such privately negotiated transactions. Any such privately negotiated purchases may be effected at purchase prices that are no higher than the per share pro rata portion of the Trust Account. To the extent that our Sponsor or its affiliates purchase any public shares as contemplated above, we will file a Current Report on Form 8-K prior to the special meeting that will disclose:

•        the amount of such public shares purchased by our Sponsor or its affiliates, along with the purchase price;

•        the purpose of the purchases by our Sponsor or its affiliates;

•        the impact, if any, of the purchases by our Sponsor or its affiliates on the likelihood that the business combination will be approved;

•        the identities of our security holders who sold to our Sponsor or its affiliates (if not purchased on the open market) or the nature of our security holders (e.g., 5% security holders) who sold to our Sponsor or its affiliates; and

•        the number of public shares for which we have received redemption requests in connection with the business combination.

Q:     How many votes do I have at the special meeting?

A:     Our stockholders are entitled to one vote at the special meeting for each share of Class A Common Stock or Class B Common Stock held of record as of            , 2022, the record date for the special meeting. As of the close of business on the record date, there were 17,439,750 outstanding shares of Class A Common Stock, which are held by our Public Stockholders, and 4,312,500 outstanding shares of Class B Common Stock, which are held by our Sponsor and the Anchor Investors.

Q:     What constitutes a quorum at the special meeting?

A:     Holders of a majority in voting power of Class A Common Stock and Class B Common Stock issued and outstanding and entitled to vote at the special meeting, virtually present or represented by proxy, constitute a quorum. In the absence of a quorum, the chairman of the meeting has the power to adjourn the special meeting. As of the record date for the special meeting, 10,876,126 shares of Class A Common Stock and Class B Common Stock, in the aggregate, would be required to achieve a quorum. Abstentions will count as present for the purposes of establishing a quorum with respect to each Proposal.

Q:     How will CENAQ’s Sponsor, directors and officers vote?

A:     Our Sponsor, directors and officers have agreed to vote any shares of Class A Common Stock and Class B Common Stock owned by them in favor of the business combination. Currently, our Sponsor owns approximately 16% of our issued and outstanding shares of Class A Common Stock and Class B Common Stock.

Q:     What interests do the current officers and directors have in the business combination?

A:     In considering the recommendation of the CENAQ Board to vote in favor of the business combination, stockholders should be aware that, aside from their interests as stockholders, our Sponsor and certain of our directors and officers have interests in the business combination that are different from, or in addition to, those of other stockholders generally. Our directors were aware of and considered these interests, among other

matters, in evaluating the business combination, and in recommending to stockholders that they approve the business combination. Stockholders should take these interests into account in deciding whether to approve the business combination. These interests include, among other things:

•        the fact that our Sponsor holds an aggregate of 4,950,000 Private Placement Warrants (including the Sponsor Forfeited Warrants) that would expire worthless if a business combination is not consummated, which if unrestricted and freely tradable would be valued at approximately $            , based on the closing price of our Public Warrants of $            per warrant on            , 2022, the record date for the special meeting, resulting in a theoretical gain of $            ;

•        the fact that our Sponsor, officers and directors have agreed not to redeem any of the shares of our common stock held by them in connection with a stockholder vote to approve the business combination;

•        the fact that our Sponsor originally paid $25,000 for 4,312,500 Founder Shares and subsequently sold 825,000 Founder Shares to the Anchor Investors in the IPO for the original purchase price of $0.0058 per share resulting in our Sponsor paying $20,215 for 3,487,500 Founder Shares and that such securities will have a significantly higher value at the time of the business combination, which if unrestricted and freely tradable would be valued at approximately $            , based on the closing price of our Class A Common Stock of $            per share on            , 2022, the record date for the special meeting, resulting in a theoretical gain of $            ;

•        the fact that CENAQ’s officers and directors collectively own, directly or indirectly, a material interest in our Sponsor;

•        the anticipated appointment of two additional directors to be named by Sponsor to the Verde Clean Fuels Board in connection with the Closing;

•        if the Trust Account is liquidated, including in the event we are unable to complete an Initial Business Combination within the required time period, our Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.10 per public share, or such lesser amount per public share as is in the Trust Account on the liquidation date, by the claims of (a) any third party for services rendered or products sold to us or (b) a prospective target business with which we have entered into an acquisition agreement, but only if such a third party or target business has not executed a waiver of all rights to seek access to the Trust Account;

•        the fact that our Sponsor will benefit from the completion of a business combination and may be incentivized to complete an acquisition of a less favorable target company or on terms less favorable to stockholders rather than liquidate;

•        the fact that our Sponsor and its affiliates can earn a positive rate of return on their investment if the trading price of our Class A Common Stock is $1.43 or more per share and the Private Placement Warrants are worthless, even if other CENAQ stockholders experience a negative rate of return in the post-business combination company;

•        the fact that our Sponsor, officers and directors will be reimbursed for out-of-pocket expenses incurred in connection with activities on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations; and

•        the fact that our Sponsor, officers and directors will lose their entire investment in us if an Initial Business Combination is not completed.

         Following the Closing, we anticipate that our Sponsor will own 2,475,000 Private Placement Warrants (after taking into account the Sponsor Forfeited Warrants) and 3,487,500 shares of Class A Common Stock (3,234,375 shares of which will be subject to forfeiture). In addition, on May 31, 2022, we issued an unsecured promissory note in the principal amount of $125,000 to our Sponsor. The note bears a 10% interest rate and is repayable in full upon the earlier of (i) February 17, 2023 or (ii) the consummation of an Initial Business Combination. The note is subject to customary events of default, the occurrence of which automatically trigger the unpaid principal balance of the note and all other sums payable with regard to the note becoming immediately due and payable.

         Further, as of the date of this proxy statement, our Sponsor or an affiliate thereof, officers and directors have incurred approximately $10,000 out of pocket expenses on CENAQ’s behalf, all of which has been repaid by CENAQ.

         Investors in our Sponsor, each of which contributed capital to our Sponsor in exchange for Founder Shares and Private Placement Warrants, include our officers and directors.

The table set forth below summarizes the interests of our officers and directors in the Private Placement Warrants and Founder Shares along with (i) the total investment made in our Sponsor by each officer and director in exchange for their interests in the Private Placement Warrants and Founder Shares and (ii) the value of such interests based on the closing price of the Public Warrants and Class A Common Stock as of            , 2022, all of which would be lost if an Initial Business Combination is not completed by us within the required time period:

____________

(1)      The number of Private Placement Warrants does not take into account the Sponsor Forfeited Warrants.

         In addition, our Charter provides that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. We do not believe, however, that this waiver of the corporate opportunities doctrine has materially affected our search for an acquisition target or will materially affect our ability to complete our business combination.

Q:     What happens if I vote against the Business Combination Proposal?

A:     Under our Charter, if the Business Combination Proposal is not approved and we do not otherwise consummate an alternative business combination by November 16, 2022 (or by February 16, 2023 if the Sponsor deposits into the Trust Account $1,725,000 for a 3-month extension to February 16, 2023 (the “SPAC Extension”)), we will be required to dissolve and liquidate the Trust Account by returning the then-remaining funds in such account to our Public Stockholders.

Q:     Do I have Redemption Rights?

A:     If you are a holder of public shares, you may elect to have your public shares redeemed for cash at the applicable redemption price per share equal to the quotient obtained by dividing (a) the aggregate amount on deposit in the Trust Account as of two business days prior to the consummation of the business combination, including interest not previously released to us to pay our franchise and income taxes as well as expenses relating to the administration of the Trust Account, by (b) the total number of then outstanding shares of Class A Common Stock included as part of the units sold in the IPO; provided that we will not redeem any public shares to the extent that such redemption would result in CENAQ having net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) under the Exchange Act) of less than $5,000,001 upon completion of an Initial Business Combination unless our Class A Common Stock otherwise does not constitute “penny stock” as such term is defined in Rule 3a51-1 under the Exchange Act. Even if we redeem 100% of the outstanding Class A Common Stock, we do not anticipate having funds of less than $5,000,001 due to the PIPE Financing. Because we anticipate that the Class A Common Stock will be listed on the Nasdaq Capital Market at the Closing, and such listing would mean that the Class A Common Stock would not constitute “penny stock” as such term is defined in Rule 3a51-1 under the Exchange Act, we do not anticipate the $5,000,001 net tangible asset threshold

being applicable. A public stockholder, together with any of his, her or its affiliates or any other person with whom it is acting in concert or as a “group” (as defined under Section 13(d)(3) of the Exchange Act), will be restricted from redeeming in the aggregate his, her or its shares or, if part of such a group, the group’s shares, in excess of 15% of the public shares (the “15% threshold”). Unlike some other blank check companies, other than the net tangible asset requirement and the 15% threshold described above, we have no specified maximum redemption threshold and there is no other limit on the number of public shares that you can redeem. Holders of our outstanding Public Warrants do not have Redemption Rights in connection with the business combination. Our Sponsor, officers and directors and the underwriters have agreed to waive their Redemption Rights with respect to any shares of our Class A Common Stock they may hold in connection with the consummation of the business combination. Additionally, our Sponsor and the Anchor Investors have agreed to waive their Redemption Rights with respect to the Founder Shares held by them. For illustrative purposes, based on the fair value of cash and marketable securities held in the Trust Account as of June 30, 2022 of approximately $174.5 million, the estimated per share redemption price would have been approximately $10.11. Additionally, shares properly tendered for redemption will only be redeemed if the business combination is consummated; otherwise holders of such shares will only be entitled to a pro rata portion of the Trust Account (including interest but net of franchise and income taxes payable as well as expenses relating to the administration of the Trust Account) (a) in connection with a stockholder vote to approve an amendment to our Charter that would affect the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an Initial Business Combination by November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension), or with respect to any other material provision relating to the rights of holders of Class A Common Stock or pre-Initial Business Combination activity, (b) in connection with the liquidation of the Trust Account or (c) if we subsequently complete a different business combination on or before November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension).

Q:     Will how I vote affect my ability to exercise Redemption Rights?

A:     No. You may exercise your Redemption Rights whether you vote your shares of Class A Common Stock for or against or abstain from voting on the Business Combination Proposal or any other proposal described in this proxy statement. As a result, the business combination can be approved by stockholders who will redeem their shares and no longer remain stockholders.

Q:     How do I exercise my Redemption Rights?

A:     In order to exercise your Redemption Rights, you must (a) if you hold your shares of Class A Common Stock through units, elect to separate your units into the underlying public shares and Public Warrants prior to exercising your Redemption Rights with respect to the public shares, and (b) prior to 5:00 p.m., Eastern time, on            , 2022 (two business days before the special meeting), tender your shares physically or electronically and submit a request in writing that we redeem your public shares for cash to Continental Stock Transfer & Trust Company, our transfer agent, at the following address:

Continental Stock Transfer & Trust Company
1 State Street, 30th Floor
New York, New York 10004-1561
Attention: Mark Zimkind
Email: mzimkind@continentalstock.com

         A public stockholder, together with any of his, her or its affiliates or any other person with whom it is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act), will be restricted from seeking Redemption Rights with respect to his, her or its shares or, if part of such a group, the group’s shares, in excess of the 15% threshold. Accordingly, all public shares in excess of the 15% threshold beneficially owned by a public stockholder or group will not be redeemed for cash. Stockholders seeking to exercise their Redemption Rights and opting to deliver physical certificates should allot sufficient time to obtain physical certificates from the transfer agent and time to effect delivery. It is our understanding that stockholders should generally allot at least two weeks to obtain physical certificates from the transfer agent.

         However, we do not have any control over this process and it may take longer than two weeks. Stockholders who hold their shares in street name will have to coordinate with their bank, broker or other nominee to have the shares certificated or delivered electronically.

         Holders of our outstanding units must separate the underlying public shares and Public Warrants prior to exercising Redemption Rights with respect to the public shares. If you hold units registered in your own name, you must deliver the certificate for such units or deliver such units electronically to Continental Stock Transfer & Trust Company with written instructions to separate such units into public shares and Public Warrants. This must be completed far enough in advance to permit the mailing of the public share certificates or electronic delivery of the public shares back to you so that you may then exercise your Redemption Rights with respect to the public shares following the separation of such public shares from the units.

         If a broker, dealer, commercial bank, trust company or other nominee holds your units, you must instruct such nominee to separate your units. Your nominee must send written instructions by facsimile to Continental Stock Transfer & Trust Company. 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 (“DTC”) DWAC (deposit withdrawal at custodian) system, a withdrawal of the relevant units and a deposit of the corresponding number of public shares and Public Warrants. This must be completed far enough in advance to permit your nominee to exercise your Redemption Rights with respect to the public shares following the separation of such public shares from the units. While this is typically done electronically on 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 will likely not be able to exercise your Redemption Rights.

         Any demand for redemption, once made, may be withdrawn at any time until the deadline for exercising redemption requests and thereafter, with our consent. If you delivered your shares for redemption to the transfer agent and decide within the required timeframe not to exercise your Redemption Rights, you may request that the transfer agent return the shares (physically or electronically). You may make such request by contacting our transfer agent at the email address or address listed under the question “Who can help answer my questions?” below.

Q:     What are the material U.S. federal income tax consequences to the CENAQ shareholders as a result of the business combination?

A:     Holders of Class A Common Stock and Public Warrants that retain their shares of Class A Common Stock and Public Warrants in the business combination will not receive any consideration in connection with the business combination and will not receive any additional shares of Class A Common Stock or additional Public Warrants in the business combination. As a result, there will be no material U.S. federal income tax consequences to such holders of Class A Common Stock and Public Warrants as a result of the business combination.

Q:     What are the U.S. federal income tax consequences of exercising my Redemption Rights?

A:     The receipt of cash by a holder of Class A Common Stock in redemption of such stock will be a taxable event for U.S. federal income tax purposes in the case of a U.S. Holder (as defined below under the caption “Proposal No. 1 — The Business Combination Proposal — Material U.S. Federal Income Tax Considerations — U.S. Federal Income Taxation of U.S. Holders”) and may be a taxable event for U.S. federal income tax purposes in the case of a Non-U.S. Holder (as defined below under the caption “Proposal No. 1 — The Business Combination Proposal — Material U.S. Federal Income Tax Considerations — U.S. Federal Income Taxation of Non-U.S. Holders”). Please see the discussion below under the caption “Proposal No. 1 — The Business Combination Proposal — Material U.S. Federal Income Tax Considerations — U.S. Federal Income Taxation of U.S. Holders” or “Proposal No. 1 — The Business Combination Proposal — Material U.S. Federal Income Tax Considerations — U.S. Federal Income Taxation of Non-U.S. Holders,” as applicable, for additional information. All holders considering the exercise of their Redemption Rights should consult with, and rely solely upon, their own tax advisors with respect to the U.S. federal income tax consequences of exercising such Redemption Rights.

Q:     If I am a warrantholder, can I exercise Redemption Rights with respect to my warrants?

A:     No. The holders of our warrants have no Redemption Rights with respect to our warrants.

Q:     How do the Public Warrants differ from the Private Placement Warrants, and what are the related risks for any public warrant holders post business combination?

A:     The Private Placement Warrants (including the shares of Class A Common Stock issuable upon exercise of the Private Placement Warrants) are not transferable, assignable or salable until 30 days after the completion of our Initial Business Combination (except, among other limited exceptions, to our officers and directors and other persons or entities affiliated with our Sponsor), and they will not be redeemable by us so long as they are held by the initial purchasers of the Private Placement Warrants or their permitted transferees. The Private Placement Warrants have terms and provisions that are identical to those of the Public Warrants, including as to exercise price, exercisability and exercise period. If the Private Placement Warrants are held by holders other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by us in all redemption scenarios and exercisable by the holders on the same basis as the Public Warrants.

         Following the business combination, we may redeem Public Warrants prior to their exercise at a time that is disadvantageous to the public warrant holders, thereby making such warrants worthless. More specifically, we have the ability to redeem outstanding Public Warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the reported last sale price of the Class A Common Stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any period of 30 consecutive trading days commencing at any time after the warrants become exercisable and ending on the third business day prior to the date on which we give notice of such redemption and provided certain other conditions are met.

         We may only call the Public Warrants for redemption upon a minimum of 30 days’ prior written notice of redemption to each public warrant holder.

         Redemption of the outstanding Public Warrants could force holders of the Public Warrants (i) to exercise Public Warrants and pay the exercise price therefor at a time when it may be disadvantageous for such holders to do so, (ii) to sell Public Warrants at the then-current market price when they might otherwise wish to hold their Public Warrants or (iii) to accept the nominal redemption price which, at the time the outstanding Public Warrants are called for redemption, is likely to be substantially less than the market value of the Public Warrants.

Q:     Do I have appraisal rights if I object to the proposed business combination?

A:     No. There are no appraisal rights available to holders of Class A Common Stock or Class B Common Stock in connection with the business combination.

Q:     What happens to the funds deposited in the Trust Account after consummation of the business combination?

A:     If the Business Combination Proposal is approved, we intend to use a portion of the funds held in the Trust Account to pay (a) a portion of our aggregate costs, fees and expenses in connection with the consummation of the business combination, (b) tax obligations and deferred underwriting discounts and commissions from the IPO and (c) for any redemptions of public shares. The remaining balance in the Trust Account, together with the PIPE Proceeds, will be used for general corporate purposes of Verde Clean Fuels. See the section entitled “Proposal No. 1 — The Business Combination Proposal” for additional information.

Q:     What happens if the business combination is not consummated or is terminated?

A:     There are certain circumstances under which the Business Combination Agreement may be terminated. See the section entitled “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement — Termination” for additional information regarding the parties’ specific termination rights. In accordance with our Charter, if an Initial Business Combination is not consummated by November 16, 2022 (or February 16, 2023 pursuant to the SPAC Extension), we will (a) cease all operations except for the purpose of winding up, (b) as promptly as reasonably possible but not more than ten business days thereafter subject to lawfully available funds therefor, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest earned on the funds held in the Trust Account and not previously released to us to pay our franchise and income taxes as well as expenses

relating to the administration of the Trust Account (less up to $100,000 of such net interest released to us to pay dissolution expenses), divided by the number of then-outstanding public shares, which redemption will completely extinguish Public Stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law and (c) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and the CENAQ Board, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

         We expect that the amount of any distribution our Public Stockholders will be entitled to receive upon our dissolution will be approximately the same as the amount they would have received if they had redeemed their shares in connection with the business combination, subject in each case to our obligations under the DGCL to provide for claims of creditors and other requirements of applicable law. Holders of our Founder Shares are not entitled to liquidating distributions from the Trust Account with respect to those shares.

         In the event of liquidation, there will be no distribution with respect to our outstanding warrants. Accordingly, in such an event, the warrants will expire worthless.

Q:     When is the business combination expected to be consummated?

A:     It is currently anticipated that the business combination will be consummated promptly following the special meeting of our stockholders to be held on            , 2022, provided that all the requisite stockholder approvals are obtained and other conditions to the consummation of the business combination have been satisfied or waived. For a description of the conditions for the completion of the business combination, see the section entitled “Proposal No. 1 — The Business Combination Proposal — The Business Combination Agreement — Conditions to Closing.”

Q:     What do I need to do now?

A:     You are urged to read carefully and consider the information contained in this proxy statement, including the section entitled “Risk Factors” and the annexes attached to this proxy statement, and to consider how the business combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement and on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker, bank or nominee.

Q:     How do I vote?

A:     If you were a holder of record of Class A Common Stock or Class B Common Stock on            , 2022, the record date for the special meeting of our stockholders, you may vote with respect to the proposals online at the special meeting or by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided. If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or other nominee, you should follow the instructions provided by your broker, bank or nominee to ensure that votes related to the shares you beneficially own are properly counted. In this regard, you must provide the record holder of your shares with instructions on how to vote your shares or, if you wish to virtually attend the special meeting and vote online, obtain a proxy from your broker, bank or nominee.

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

A:     At the special meeting, we will count a properly executed proxy marked “ABSTAIN” with respect to a particular proposal as present for purposes of determining whether a quorum is present. For purposes of approval, failure to vote or an abstention will have no effect on the Business Combination Proposal, the Nasdaq Proposal, the 2023 Plan Proposal, the Director Election Proposal or the Adjournment Proposal, but will have the same effect as a vote AGAINST the Charter Proposal.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. We have based these forward-looking statements on our current expectations and projections about future events. All statements, other than statements of present or historical fact included in this proxy statement, regarding the proposed business combination, CENAQ’s ability to consummate the business combination, the benefits of the transaction, the post-combination company’s future financial performance following the business combination and the post-combination company’s strategy, expansion plans, future operations, future operating results, estimated revenues, losses, projected costs, prospects, plans and objectives of management are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “continue,” “project” or the negative of such terms or other similar expressions. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Except as otherwise required by applicable law, CENAQ disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this proxy statement. CENAQ cautions you that these forward-looking statements are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of CENAQ.

In addition, CENAQ cautions you that the forward-looking statements regarding CENAQ and the post-combination company, which are contained in this proxy statement, are subject to the following factors:

•        the occurrence of any event, change or other circumstances that could delay the business combination or give rise to the termination of the Business Combination Agreement and the other agreements related to the business combination (including catastrophic events, acts of terrorism, the outbreak of war, the novel coronavirus pandemic (“COVID-19”) and/or any other pandemic and other public health events), as well as management’s response to any of the foregoing;

•        the outcome of any legal proceedings that may be instituted against CENAQ, Intermediate, their affiliates or their respective directors and officers following announcement of the business combination;

•        the inability to complete the business combination due to the failure to obtain approval of the stockholders of CENAQ, regulatory approvals, or satisfy the other conditions to closing in the Business Combination Agreement;

•        the risk that CENAQ may not be able to obtain the financing necessary to consummate the business combination;

•        the risk that the proposed business combination disrupts current plans and operations of Intermediate or CENAQ as a result of the announcement and consummation of the business combination;

•        CENAQ’s ability to realize the anticipated benefits of the business combination, which may be affected by, among other things, competition and the ability of Verde Clean Fuels to grow and manage growth profitably following the business combination;

•        risks relating to the uncertainty of the projected financial information with respect to Intermediate;

•        any decline in the value of carbon credits and the development of the carbon credit markets;

•        risks relating to Intermediate’s status as a development stage company with a history of net losses and ability to continue as a going concern;

•        risks relating to the uncertainty of success or delays of Intermediate’s research and development efforts;

•        costs related to the business combination;

•        disruptions in the supply chain, fluctuation in price of product inputs, and market conditions and global and economic factors beyond Intermediate’s or the post-combination company’s control;

•        Verde Clean Fuels’ success in retaining or recruiting, or changes required in, its officers, key employees or directors following the business combination;

•        the possibility of third-party claims against CENAQ’s Trust Account;

•        the amount of redemption requests by CENAQ’s stockholders;

•        changes in applicable laws or regulations;

•        the ability of Intermediate to execute its business model, including market acceptance of gasoline derived from renewable feedstocks;

•        litigation and the ability to adequately protect intellectual property rights;

•        competition from companies with greater resources and financial strength in the industries in which Verde Clean Fuels will operate;

•        the possibility that a catastrophic event, pandemic, or other economic, business or competitive factors may adversely affect the results of operations, financial position and cash flows of CENAQ or the post-combination company; and

•        other factors detailed under the section entitled “Risk Factors.”

Should one or more of the risks or uncertainties described in this proxy statement, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements. Additional information concerning these and other factors that may impact the operations and projections discussed herein can be found in the section entitled “Risk Factors” in CENAQ’s final prospectus for its Initial Public Offering, which was filed with the SEC on August 13, 2021, and in CENAQ’s periodic filings with the SEC, including its Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2021 and any subsequently filed Quarterly Reports on Form 10-Q. CENAQ’s SEC filings are available publicly on the SEC’s website at http://www.sec.gov.

RISK FACTORS

Risks Related to Intermediate

The following risk factors will apply to our business and operations following the completion of the business combination. These risk factors are not exhaustive, and investors are encouraged to perform their own investigation with respect to the business, financial condition and prospects of Intermediate and our business, financial condition and prospects following the completion of the business combination. You should carefully consider the following risk factors in addition to the other information included in this proxy statement, including matters addressed in the section entitled “Cautionary Note Regarding Forward-Looking Statements.” We may face additional risks and uncertainties that are not presently known to us, or that we currently deem immaterial, which may also impair our business or financial condition. The following discussion should be read in conjunction with the financial statements of Intermediate and notes to the financial statements included herein.

Risks Related to Intermediate’s Business, Operations and Industry

For purposes of this subsection entitled “Risks Related to Intermediate’s Business, Operations and Industry,” “we,” “us,” “our” and the “company” refer to (i) Intermediate and its subsidiaries prior to the consummation of the business combination and (ii) Verde Clean Fuels and its subsidiaries following the consummation of the business combination, unless the context otherwise requires.

Our commercial success depends on our ability to develop and operate production facilities for the commercial production of renewable gasoline.

Our business strategy includes growth primarily through the construction and development of commercial production facilities, including the development of our first commercial production facility which we expect to support first commercial production of renewable gasoline as early as the second half of 2024. This strategy depends on our ability to successfully construct and complete commercial production facilities on favorable terms and on our expected schedule, obtain the necessary permits, governmental approvals and carbon credit qualifications needed to operate our commercial production facilities and identify and evaluate development and partnership opportunities to expand our business. We cannot guarantee that we will be able to successfully develop commercial production facilities, obtain necessary approval, qualifications and permits necessary to operate, identify new opportunities and develop new technologies and commercial production facilities, or establish and maintain our relationships with key strategic partners. In addition, we will compete with other companies for these development opportunities, which may increase our costs. We also expect to achieve growth through the expansion of our in-process projects as the facilities are expanded or otherwise begin to produce renewable gasoline, but we cannot assure you that we will be able to reach or renew the necessary agreements to complete these commercial production facilities or expansions. If we are unable to successfully identify and consummate future commercial production facility opportunities or complete or expand our planned commercial production facilities, it will impede our ability to execute our growth strategy.

Our ability to develop and operate commercial production facilities, as well as expand production at future commercial production facilities, is subject to many risks beyond our control, including:

•        regulatory changes that affect the value of renewable fuels including changes to existing federal and state level low-carbon fuel credit systems, which could have a significant effect on the financial performance of our commercial production facilities and the number of potential projects with attractive economics;

•        competition from other carbon-based and non-carbon-based fuel producers;

•        changes in energy commodity prices, such as crude oil and natural gas as well as wholesale electricity prices, which could have a significant effect on our revenues and expenses;

•        changes in quality standards or other regulatory changes that may limit our ability to produce renewable gasoline or increase the costs of processing renewable gasoline;

•        changes in the broader waste collection industry or changes to environmental regulations governing the industry, including changes affecting the waste collection and biogas potential of the landfill industry, which could limit the renewable fuel feedstock that we currently target for our commercial production facilities;

•        substantial construction risks, including the risk of delay, that may arise due to forces outside of our control, including those related to engineering and environmental problems, changes in laws and regulations and inclement weather and labor disruptions;

•        the ability to establish and maintain our relationships with key strategic partners, on favorable terms or at all;

•        disruptions in sales, productions, service or other business activities or our inability to attract and retain qualified personnel;

•        operating risks and the effect of disruptions on our business, including the effects of global health crises or pandemics (such as COVID-19), weather conditions, catastrophic events such as fires, explosions, earthquakes, droughts and acts of terrorism, and other force majeure events on us, our customers, suppliers, distributors and subcontractors;

•        accidents involving personal injury or the loss of life;

•        entering into markets where we have less experience than our competitors;

•        challenges arising from our ability to recruit and retain key personnel;

•        the ability to obtain financing for a commercial production facility on acceptable terms or at all and the need for substantially more capital than initially budgeted to complete a commercial production facility and exposure to liabilities as a result of unforeseen environmental, construction, technological or other complications;

•        failures or delays in obtaining desired or necessary land rights, including ownership, leases, easements, zoning rights and building permits;

•        a decrease in the availability, pricing and timeliness of delivery of raw materials and components, necessary for the commercial production facilities to function;

•        obtaining and keeping in good standing permits, authorizations and consents (including environmental and operating permits) from local city, county, state and U.S. federal governments as well as local and U.S. federal governmental organizations;

•        difficulties in identifying, obtaining and permitting suitable sites for new commercial production facilities; and

•        identifying potential customers for our products and entering into contracts to sell our products on favorable terms.

Any of these factors could prevent us from developing, operating or expanding our commercial production facilities, or otherwise adversely affect our business, financial condition and results of operations.

Our limited history makes it difficult to evaluate our business and prospects and may increase the risks associated with your investment.

We were formed in 2020 and although our core technology has been developed and tested for over thirteen years, we have not produced renewable gasoline on a large-scale, commercial level. As a result, we have a limited operating history upon which to evaluate our business and future prospects, which subjects us to a number of risks and uncertainties, including our ability to plan for and predict future growth. Since our founding, and acquisition of the STG+ technology in 2020, we have made significant progress towards constructing our first commercial production facility. Following the acquisition of the patented STG+ process and demonstration facility with over 10,500 historical operating hours, we have continued to focus on commercial scale production of on-spec

renewable gasoline from renewable feedstocks. The reactor designs, gas velocity, process configurations, and control system of the demonstration facility are representative of a full-scale production facility. We have also participated in carbon lifecycle studies to validate the carbon intensity score and reduced lifecycle carbon emissions of our renewable gasoline as well as fuel testing studies to validate the specification and performance our gasoline product. As we continue to develop our first commercial production facility, we expect our operating losses and negative operating cash flows to grow until first commercial production.

We have encountered and expect to continue to encounter risks and difficulties experienced by growing companies in rapidly developing and changing industries, including challenges related to achieving market acceptance of our renewable fuel, competing against companies with greater financial and technical resources, competing against entrenched incumbent competitors that have long-standing relationships with our prospective customers in the commercial renewable fuels market, recruiting and retaining qualified employees, and making use of our limited resources. We cannot ensure that we will be successful in addressing these and other challenges that we may face in the future, and our business may be adversely affected if we do not manage these risks appropriately. As a result, we may not attain sufficient revenue to achieve or maintain positive cash flow from operations or profitability in any given period, or at all.

Our management has identified conditions that raise substantial doubt about our ability to continue as a going concern.

Our management has concluded that there is substantial doubt about our ability to continue as a going concern. Since inception, we have incurred significant operating losses, have an accumulated deficit of approximately $15.1 million as of June 30, 2022 and negative operating cash flow during the six months ended June 30, 2022 and June 30, 2021, as well as for the year ended December 31, 2021. Our management expects that operating losses and negative cash flows may increase from the June 30, 2022 and December 31, 2021 levels because of additional costs and expenses related to the development of technology and commercial production facilities. These conditions raise substantial doubt about our ability to continue as a going concern. The ability to continue as a going concern is dependent upon generating profitable operations in the future and/or obtaining the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they become due. There can be no assurance that we will be successful in our plans described elsewhere in this proxy statement or in attracting future debt or equity financings or strategic and collaborative ventures with third parties on acceptable terms, or if at all. In response to these conditions, and pursuant to a written parental support letter between Intermediate and BERR, BERR has committed to provide funding to enable us to meet our obligations as they become due through at least December 31, 2023. Since July 31, 2020 (our inception), BERR has made total capital contributions of $8,250,000 to us, including $2,500,000 since December 31, 2021. While no capital contributions have been made under the parental support letter to date, we expect BERR to make capital contributions under the parental support letter up until the time of Closing. As a result, we have concluded that management’s plans are probable of being achieved to alleviate substantial doubt about our ability to continue as a going concern.

We may be unable to qualify for existing federal and state level low-carbon fuel credits and the carbon credit markets may not develop as quickly or efficiently as we anticipate or at all.

The continued development of carbon credit marketplaces will be crucial for our success, as we expect carbon credits (including, for example, the Federal Renewable Fuel Standard (“RFS”) for the D3 RIN and various state carbon programs such as California’s Low Carbon Fuel Standard (“LCFS”)) to be a significant source of future revenue. The efficiency of the voluntary carbon credit market is currently affected by several concerns, including insufficiency of demand, the risk that carbon reduction credits could be counted multiple times and a lack of standardization of credit verification. Additionally, the value of products produced using our process technologies may be dependent on the value of carbon credits which may fluctuate based on these market forces. Under the current RFS regulations, renewable gasoline produced from separated yard waste, crop residue, slash, and pre-commercial thinnings, biogenic components of separated municipal solid waste, cellulosic components of separated food waste, and cellulosic components of annual cover crops through a gasification and upgrading process qualifies for D3 RINs. Our commercial production facilities will utilize gasification and upgrading to produce renewable gasoline from one or more of these feedstocks. Accordingly, we believe that the renewable gasoline produced by our commercial production facilities will qualify for D3 RINs and intend to register with EPA as a producer of RINs prior to the commercial operation of our first commercial production facility. However, if our renewable gasoline is unable to qualify under the RFS for the D3 RIN and various state carbon programs, our

financial condition and results of operations could be adversely impacted. Delayed development of carbon credit markets, as well as any decline in the value of carbon credits or other incentives associated with products produced using our process technologies, could also negatively impact the commercial viability of our commercial production facilities and could limit the growth of the business and adversely impact our financial condition and future results. There is a risk that the supply of low-carbon alternative materials and products outstrips demand, resulting in the value of carbon credits declining. Any decline in the value of carbon credits or other incentives associated with products produced using our process technologies could harm our results of operations, cash flow and financial condition. The value of carbon credits and other incentives may also be adversely affected by legislative, agency, or judicial determinations.

Significant capital investment is required to develop and conduct our operations and we intend to raise additional funds through debt financing for our planned operations. These funds may not be available when needed.

The construction and development of our proposed commercial production facilities through 2024 requires substantial capital investment. We intend to fund approximately 70% of such capital in the future through debt financing, which may include project financing, industrial revenue bonds, pollution control bonds or some other combination. While we have been in discussions with banks and other credit counterparties regarding project financing, industrial revenue bonds, or pollution control bonds, and these discussions have led to indications of debt financing equivalent to 70% of our expected capital expenditure requirements through 2024, there can be no assurance that we will be successful in obtaining such financing. If we are unable to obtain debt financing on favorable terms or at all, or, if proceeds raised in our transaction with CENAQ are less than expected, our development timeline may be delayed and would require raising of additional equity or debt capital.

Additionally, Verde Clean Fuels may raise additional funds through the issuance of equity, equity-related or debt securities, through obtaining credit from government or financial institutions or by engaging in joint ventures or other alternative forms of financing following Closing. Verde Clean Fuels cannot be certain that additional funds will be available on favorable terms when required, or at all. If Verde Clean Fuels cannot raise additional funds when needed, its financial condition, results of operations, business and prospects could be materially and adversely affected. If Verde Clean Fuels raises funds through the issuance of debt securities or through loan arrangements, the terms of such debt securities or loan arrangements could require significant interest payments, contain covenants that restrict Verde Clean Fuels’ business, or contain other unfavorable terms. In addition, to the extent Verde Clean Fuels raises funds through the sale of additional equity securities, Verde Clean Fuels stockholders would experience additional dilution.

In order to construct new commercial production facilities, we typically face a long and variable design, fabrication, and construction development cycle that requires significant resource commitments and may create fluctuations in whether and when revenue is recognized, and may have an adverse effect on our business.

The development, design and construction process for our commercial production facilities generally lasts from 24 to 36 months, on average. Prior to constructing and developing a commercial production facility, we typically conduct a preliminary review and assess whether the commercial production facility is commercially viable based on our expected return on investment, investment payback period, and other operating metrics, as well as the necessary permits to develop such commercial production facility. This extended development process requires the dedication of significant time and resources from our management team, with no certainty of success or recovery of our expenses. Further, upon commencement of operations, we expect it may take six months or longer for the commercial production facility to ramp up to our expected production level. All of these factors, and in particular, increased spending that is not offset by increased revenues, can contribute to fluctuations in our quarterly financial performance and increase the likelihood that our operating results in a particular period will fall below investor expectations.

Our business will require suitable tracts of real property upon which to construct and operate the specialized equipment supporting our commercial production facilities. We anticipate that such tracts of real property will be predominantly leased from third parties under long-term land leases, but it is possible that some of such tracts may be purchased by us. If we are unable to identify such suitable tracts of real property, or if we are unable to purchase or lease such tracts at commercially reasonable rates and under terms favorable to us, our business may be adversely affected.

The construction and operation of the equipment supporting our commercial production facilities sales may require specialized permitting from applicable governmental authorities. We may be unable to obtain such specialized permitting, or we may experience significant delays in obtaining such specialized permitting, and this may delay our ability to launch these facilities for commercial operations, which may have a significant impact on our revenue and profitability.

The complexity, expense, and nature of customer procurement processes result in a lengthy customer acquisition and sales process. We anticipate that it may take us months to attract, obtain an award from, contract with, and recognize revenue from the production of renewable gasoline by a new commercial production facility, if we are successful at all.

We have entered into relatively new markets for renewables, including renewable natural gas, renewable gasoline and biofuel. These new markets are highly volatile and have significant risk associated with current market conditions.

We have limited experience in marketing and selling renewable gasoline. As such, we may not be able to compete successfully with existing or new competitors in supplying renewable gasoline to potential customers. If we are unable to establish production and sales channels that allow us to offer comparable products at attractive prices, we may not be able to compete effectively in the market. Furthermore, there can be no assurance that our renewables business will ever generate significant revenues or maintain profitability. The failure to do so could have a material adverse effect on our business and results of operations.

Fluctuations in the price of product inputs, including renewable feedstocks, natural gas and other feedstocks, may affect our cost structure.

Our approach to the renewable fuels market will be dependent on the price of renewable feedstocks, such as biomass and MSW, as well as natural gas (including synthetic natural gas) and other feedstocks that will be used to produce our renewable gasoline. A decrease in the availability of feedstocks or an increase in the price may have a material adverse effect on our financial condition and operating results. At certain levels, prices may make these products uneconomical to use and produce as we may be unable to pass the full amount of feedstock cost increases on to our customers.

The price and availability of biomass, MSW, natural gas and other feedstocks may be influenced by general economic, market and regulatory factors. These factors include weather conditions, farming decisions, government policies and subsidies with respect to agriculture and international trade and global demand and supply. For example, renewable feedstock prices may increase significantly in response to increased demand for biomass for the production of competing renewable fuels.

Fluctuations in petroleum prices and customer demand patterns may reduce demand for renewable fuels and bio-based chemicals. A prolonged environment of low petroleum prices or reduced demand for renewable fuels or biofuels could have a material adverse effect on our long-term business prospects, financial condition and results of operations.

Our renewable gasoline may be considered an alternative to petroleum-based fuels. Therefore, if the price of crude oil falls, any revenues that we generate from renewable gasoline could decline and we may be unable to produce products that are a commercially viable alternative to petroleum-based fuels. Additionally, demand for liquid transportation fuels, including renewable gasoline, may decrease due to economic conditions or other factors outside of our control, which could have a material adverse impact on our business and results of operations.

Long-term renewable fuels prices may fluctuate substantially due to factors outside of our control. The price of renewable fuels can vary significantly for many reasons, including: (i) increases and decreases in the number of internal combustion engines in operation in our markets; (ii) changes in competing liquid hydrocarbon technologies or fuel transportation capacity constraints or inefficiencies; (iii) energy or renewable fuel supply disruptions; (iv) weather conditions; (v) seasonal fluctuations; (vi) changes in the demand for energy or in patterns of renewable fuel usage, including the potential development of demand-side management tools and practices; (vi) development of new fuels or new technologies for the production of renewable fuels; and (vii) federal and state regulations.

We may face substantial competition from companies with greater resources and financial strength, which could adversely affect our performance and growth.

We may face substantial competition in the market for renewable fuel. Our competitors include companies in the incumbent petroleum-based industry as well as those in the emerging renewable fuels industry. The petroleum-based industry benefits from a large established infrastructure, production capability and business relationships. The greater resources and financial strength in this industry provide significant competitive advantages that we may not be able to overcome in a timely manner.

Our ability to compete successfully will depend on our ability to develop proprietary products that reach the market in a timely manner and are technologically superior to and/or are less expensive than other products on the market. Many of our competitors have substantially greater production, financial, research and development, personnel and marketing resources than we do. In addition, certain of our competitors may also benefit from local government subsidies and other incentives that are not available to us. As a result, our competitors may be able to develop competing and/or superior technologies and processes, and compete more aggressively and sustain that competition over a longer period of time than we could. Our technologies and products may be rendered obsolete or uneconomical by technological advances or entirely different approaches developed by one or more of our competitors. As more companies develop new intellectual property in our markets, the possibility of a competitor acquiring patent or other rights that may limit our business or operations increases, which could lead to litigation. Furthermore, to secure purchase agreements from certain customers, we may be required to enter into exclusive supply contracts, which could limit our ability to further expand our sales to new customers. Likewise, major potential customers may be locked into long-term, exclusive agreements with our competitors, which could inhibit our ability to compete for their business.

Our ability to compete successfully also depends on our ability to identify, hire, attract, train and develop and retain highly qualified personnel. We may not be able to recruit and hire a sufficient number of such personnel which may adversely affect our results of operations, sales capabilities and financial position. New hires require significant training and time before they achieve full productivity and the ability to attract, hire and retain them depends on our ability to provide competitive compensation. There is significant competition for personnel with strong sales skills and technical knowledge. We may be unable to hire or retain sufficient numbers of qualified individuals and such failure could adversely affect our business, including the execution of our proposed growth projects.

In addition, various governments have recently announced a number of spending programs focused on the development of clean technologies, including alternatives to petroleum-based fuels and the reduction of carbon emissions. Such spending programs could lead to increased funding for our competitors or a rapid increase in the number of competitors within those markets.

We also may face substantial competition as we develop our commercial production facilities and STG+ technology and seek to work with agricultural industry participants, commercial waste companies and landowners to source our renewable feedstocks, including biomass and MSW, as well as natural gas and other feedstocks and lease or acquire land to install and operate commercial production facilities. Our competitors include established companies and developers with significantly greater resources and financial strength, which may provide them with competitive advantages that we may not be able to overcome in a timely manner, or at all.

Our limited resources relative to many of our competitors may cause us to fail to anticipate or respond adequately to new developments and other competitive pressures. This failure could reduce our competitiveness and market share, adversely affect our results of operations and financial position and prevent us from obtaining or maintaining profitability.

Our proposed growth projects may not be completed or, if completed, may not perform as expected. Our project development activities may consume a significant portion of our management’s focus, and if not successful, reduce our profitability.

We plan to grow our business by building multiple commercial production facilities, including our first commercial STG+ based production facility in the United States, along with our additional planned and identified potential commercial production facilities. Development projects may require us to spend significant sums for engineering, permitting, legal, financial advisory and other expenses before we determine whether a development project is feasible, economically attractive or capable of being financed.

Our development projects are typically planned to be large and complex, and we may not be able to complete them. There can be no assurance that we will be able to negotiate the required agreements, overcome any local opposition, or obtain the necessary approvals, licenses, permits and financing. Failure to achieve any of these elements may prevent the development and construction of a project. If that were to occur, we could lose all of our investment in development expenditures and may be required to write-off project development assets.

We may not be able to develop, maintain and grow strategic relationships, identify new strategic relationship opportunities, or form strategic relationships, in the future.

We expect that our ability to establish, maintain, and manage strategic relationships, such as our agreements with Waste Management, Inc. (“Waste Management”), InEnTec Inc. (“InEnTec”) and EcoStrat Inc. (“EcoStrat”), could have a significant impact on the success of our business. While we expect to increase the amount of revenue associated with our STG+ technology to become a more substantial operating entity in the future, there can be no assurance that we will be able to identify or secure suitable and scalable business relationship opportunities in the future or that our competitors will not capitalize on such opportunities before we do.

Additionally, we cannot guarantee that the companies with which we have developed or will develop strategic relationships will continue to devote the resources necessary to promote mutually beneficial business relationships and grow our business. Our current arrangements are not exclusive, and some of our strategic partners work with our competitors. If we are unsuccessful in establishing or maintaining our relationships with key strategic partners, our overall growth could be impaired, and our business, prospects, financial condition, and operating results could be adversely affected.

We may acquire or invest in additional companies, which may divert our management’s attention, result in additional dilution to our stockholders, and consume resources that are necessary to sustain our business.

Although we have not made any acquisitions to date, our business strategy in the future may include acquiring other complementary products, technologies, or businesses. We also may enter relationships with other businesses to expand our operations and to create service networks to support our production and delivery of renewable gasoline. An acquisition, investment, or business relationship may result in unforeseen operating difficulties and expenditures. We may encounter difficulties assimilating or integrating the businesses, technologies, products, services, personnel, or operations of the acquired companies particularly if the key personnel of the acquired companies choose not to work for us. Acquisitions may also disrupt our business, divert our resources, and require significant management attention that would otherwise be available for the development of our business. Moreover, the anticipated benefits of any acquisition, investment, or business relationship may not be realized or we may be exposed to unknown liabilities.

Negotiating these transactions can be time consuming, difficult, and expensive, and our ability to close these transactions may often be subject to approvals that are beyond our control. Consequently, these transactions, even if undertaken and announced, may not close. Even if we do successfully complete acquisitions, we may not ultimately strengthen our competitive position or achieve our goals, and any acquisitions we complete could be viewed negatively by our customers, securities analysts, and investors.

Fluctuations in the price and availability of energy to power our facilities may harm our performance.

We anticipate our commercial production facilities to use significant amounts of energy to produce our renewable gasoline. Accordingly, our business is dependent upon energy supplied by third parties. The prices and availability of energy resources are subject to volatile market conditions. These market conditions are affected by factors beyond our control, such as weather conditions, overall economic conditions and governmental regulations. Should the price of energy increase or should access to the required energy sources be unavailable, our business could suffer and have a material adverse impact on our results of operations. In addition, a lack of availability of sufficient amounts of renewable energy to effectively decarbonize our facilities could have a material impact on our business and results of operations.

We may be subject to liabilities and losses that may not be covered by insurance.

Our employees and facilities are subject to the hazards associated with producing renewable gasoline. Operating hazards can cause personal injury and loss of life, damage to, or destruction of, property, plant and equipment and environmental damage. We maintain insurance coverage in amounts against the risks that we believe are consistent with industry practice, and maintain a safety program. However, we could sustain losses for uninsurable or uninsured risks, or in amounts in excess of existing insurance coverage. Events that result in significant personal injury or damage to our property or to property owned by third parties or other losses that are not fully covered by insurance could have a material adverse effect on our results of operations and financial position.

Insurance liabilities are difficult to assess and quantify due to unknown factors, including the severity of an injury, the determination of our liability in proportion to other parties, the number of incidents not reported and the effectiveness of our safety program. If we were to experience insurance claims or costs above our coverage limits or that are not covered by our insurance, we might be required to use working capital to satisfy these claims rather than to maintain or expand our operations. To the extent that we experience a material increase in the frequency or severity of accidents or workers’ compensation claims, or unfavorable developments on existing claims, our operating results and financial condition could be materially and adversely affected.

Renewable gasoline has not previously been used as a commercial fuel in significant amounts, its use subjects us to product liability risks and we may become subject to product liability claims, which could harm our financial condition and liquidity if we are not able to successfully defend or insure against such claims.

Renewable gasoline has not been used as a commercial fuel in large quantities or for a long period of time. Research regarding this product and its distribution infrastructure is ongoing. Although renewable gasoline has been tested on some engines, there is a risk that it may damage engines or otherwise fail to perform as expected. If renewable gasoline degrades the performance or reduce the life-cycle of engines, or causes them to fail to meet emissions standards, market acceptance could be slowed or stopped, and we could be subject to product liability claims. A significant product liability lawsuit could substantially impair our production efforts and could have a material adverse effect on our business, reputation, financial condition and results of operations.

While we intend to carry insurance for product liability, it is possible that our insurance coverage may not cover the full exposure on a product liability claim of significant magnitude. A successful product liability claim against us could require us to pay a substantial monetary award. A product liability claim could also generate substantial negative publicity about our business and operations and could have an adverse effect on our brand, business, prospects, financial condition, and operating results.

Liabilities and costs associated with hazardous materials, contamination and other environmental conditions may require us to conduct investigations or remediation or expose us to other liabilities, both of which may adversely impact our operations and financial condition.

We may incur liabilities for the investigation and cleanup of any environmental contamination at our commercial production facilities, or at off-site locations where we arrange for the disposal of hazardous substances or wastes. For example, under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 and other federal, state and local laws, certain broad categories of persons, including an owner or operator of a property, may become liable for costs of investigation and remediation, impacts to human health and for damages to natural resources. These laws often impose strict and joint and several liability without regard to fault or degree of contribution or whether the owner or operator knew of, or was responsible for, the release of such hazardous substances or whether the conduct giving rise to the release was legal at the time it occurred. We also may be subject to related claims by private parties, including employees, contractors, or the general public, alleging property damage and personal injury due to exposure to hazardous or other materials at or from those properties. We may incur substantial costs or other damages associated with these obligations, which could adversely impact our business, financial condition and results of operations.

Furthermore, we rely on third parties to ensure compliance with certain environmental laws, including those relating to the disposal of wastes. Any failure to properly handle or dispose of wastes, regardless of whether such failure is ours or our contractors, could result in liability under environmental, health and safety laws. The costs of liability could have a material adverse effect on our business, financial condition or results of operations.

Our operations, and future planned operations, are subject to certain environmental health and safety laws or permitting requirements, which could result in increased compliance costs or additional operating costs and restrictions. Failure to comply with such laws and regulations could result in substantial fines or other limitations that could adversely impact our financial results or operations.

Our operations, as well as our contractors, suppliers, and customers, are subject to certain federal, state, local and foreign environmental laws and regulations governing, among other things, the generation, storage, transportation, and disposal of hazardous substances and wastes. We or others in our supply chain may be required to obtain permits and comply with procedures that impose various restrictions and operations that could have adverse effects on our operations. If key permits and approvals cannot be obtained on acceptable terms, or if other operations requirements cannot be met in a manner satisfactory for our operations or on a timeline that meets our commercial obligations, it may adversely impact our business. There are also significant capital, operating and other costs associated with compliance with these environmental laws and regulations.

Environmental and health and safety laws and regulations are subject to change and may become more stringent over time, such as through new regulations enacted at the supranational, national, sub-national, and/or local level or new or modified regulations that may be implemented under existing law. The nature and extent of any changes in these laws, rules, regulations, and permits could have material effects on our business. Future legislation and regulations or changes in existing legislation and regulations, or interpretations thereof, could cause additional expenditures, restrictions, and delays in connection with our operations as well as our other future projects.

Future changes to our operations, such as siting of new facilities or the implementation of manufacturing processes at our planned future facilities, could result in increased expenditures to comply with environmental laws, or to obtain and comply with pre-construction and operating permits. For example, federal siting requirements could require us to consider alternative sites for our manufacturing facilities or we could be subject to challenges from stakeholders regarding the use of land for such facilities, which could lead to delays or an inability to construct new facilities. Additionally, future planned operations may create regulated emissions which may require obtaining permits, adhering to permit limits, and/or the use of emissions control technology at our manufacturing facilities. Should permitted limits or other requirements applicable to our current or future operations change in the future, we may be required to install additional, more costly control technology to ensure continued compliance with environmental laws or permits. Any failure to comply with environmental laws could result in significant fines and penalties or business interruptions that could adversely impact our financial results or operations.

Increased focus on sustainability or other ESG matters could impact our operations.

Our business requires customers and financial institutions to view our business and operations as having a positive environmental, social and corporate governance (“ESG”) profile. Increasing attention to, and societal expectations regarding, climate change, human rights, and other ESG topics may require us to make certain changes to our business operations to satisfy the expectations of customers and financial institutions. Additionally, our customers may be driven to purchase our fuel products due to their own sustainability or ESG commitments, which may entail holding their suppliers — including us — to ESG standards that go beyond compliance with laws and regulations and our ability to comply with such standards. Failure to maintain operations that align with such “beyond compliance” standards may cause potential customers to not do business with us or otherwise hurt demand for our products. These and other ESG concerns could adversely affect our business, prospects, financial condition and operating results.

Failure of third parties to manufacture quality products or provide reliable services in accordance with schedules, prices, quality and volumes that are acceptable to us could cause delays in developing and operating our commercial production facilities, which could damage our reputation, adversely affect our partner relationships or adversely affect our growth.

Our success depends on our ability to develop and operate our commercial production facilities in a timely manner, which depends in part on the ability of third parties to provide us with timely and reliable products and services. In developing and operating our commercial production facilities and technologies, we rely on products meeting our design specifications and components manufactured and supplied by third parties, and on services performed by contractors and subcontractors. We also rely on contractors and subcontractors to perform substantially all of the construction and installation work related to our commercial production facilities, and we often need to engage contractors or subcontractors with whom we have no past experience.

If any of our contractors or subcontractors are unable to provide services that meet or exceed our expectations or satisfy our contractual commitments, our reputation, business and operating results could be harmed. In addition, if we are unable to avail ourselves of warranties and other contractual protections with providers of products and services, we may incur liability to our customers or additional costs related to the affected products, which could adversely affect our business, financial condition and results of operations. Moreover, any delays, malfunctions, inefficiencies or interruptions in these products or services could adversely affect the quality and performance of our commercial production facilities and require considerable expense to find replacement products and to maintain and repair our facilities. This could cause us to experience interruption in our production and distribution of renewable gasoline, difficulty retaining current relationships and attracting new relationships, or harm our brand, reputation or growth.

We may be unable to successfully perform under future supply and distribution agreements to provide our renewable gasoline, which could harm our commercial prospects.

We expect to enter into multiple supply agreements pursuant to which we will supply our renewable gasoline to various customers. Under certain of these supply agreements, we expect the purchasers will agree to pay for and receive, or cause to be received by a third party, or pay for even if not taken, the renewable gasoline under contract (a “take-or-pay” arrangement). We anticipate that the timing and volume commitment of certain of these agreements will be conditioned upon, and subject to, our ability to complete the construction of our first commercial production facility and our additional planned and identified potential commercial production facilities. In order to construct and commence operations of commercial production facilities, we must secure third-party financing. While we have secured and believe that we can secure additional adequate financing in order to commence construction of and complete our commercial production facilities and, in turn, perform under these agreements, we cannot assure you that we will in the future be able to obtain adequate financing on favorable terms, or at all. Furthermore, we have not demonstrated that we can meet the production levels and specifications contemplated in anticipated or future supply agreements. If our production is slower than we expect, if demand decreases or if we encounter difficulties in successfully completing our first commercial production facility and our additional planned and identified potential commercial production facilities, the counterparties may terminate the supply agreements and potential customers may be less willing to negotiate definitive supply agreements with us, and therefore cause our performance to suffer.

In addition, from time to time, we may enter into letters of intent, memoranda of understanding and other largely non-binding agreements or understandings with potential customers or partners in order to develop our business and the markets that we serve. We can make no assurance that legally binding, definitive agreements reflecting the terms of such non-binding agreements will be completed with such customers or partners, or at all.

Third parties on whom we may rely for transportation services are subject to complex federal, state and other laws that could adversely affect our operations.

The operations of third parties on whom we may rely for transportation services are subject to complex and stringent laws and regulations that require obtaining and maintaining numerous permits, approvals and certifications from various federal, state and local government authorities. These third parties may incur substantial costs in order to comply with existing laws and regulations. If existing laws and regulations governing such third party services

are revised or reinterpreted, or if new laws and regulations become applicable to their operations, these changes may affect the costs that we pay for services. Similarly, a failure to comply with such laws and regulations by the third parties could have a material adverse effect on our business, financial condition and results of operations.

Our business and operations may be significantly disrupted upon the occurrence of a catastrophic event, information technology system failures or cyberattack.

Our business is dependent on proprietary technologies, processes and information that we have developed, much of which is stored on our computer systems. We also have entered into agreements with third parties for hardware, software, telecommunications and other information technology (“IT”) services in connection with our operations. Our operations depend, in part, on how well we and our vendors protect networks, equipment, IT systems and software against damage from a number of threats, including, but not limited to, cable cuts, damage to physical plants, natural disasters, intentional damage and destruction, fire, power loss, hacking, computer viruses, vandalism, theft, malware, ransomware and phishing attacks. Any of these and other events could result in IT system failures, delays, a material disruption of our business or increases in capital expenses. Our operations also depend on the timely maintenance, upgrade and replacement of networks, equipment and IT systems and software, as well as preemptive expenses to mitigate the risks of failures.

Furthermore, the importance of such information technology systems and networks and systems has increased due to many of our employees working remotely on less secure systems and environments. Additionally, if one of our service providers were to fail and we were unable to find a suitable replacement in a timely manner, we could be unable to properly administer our outsourced functions. If we cannot continue to retain these services provided by our vendors on acceptable terms, our access to the IT system and services could be interrupted. Any security breach, interruption or failure in our IT system and operations could impair quality of services, increase costs, prompt litigation and other consumer claims, and damage our reputation, any of which could substantially harm our business, financial condition or the results of operations.

As cyber threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities. While we have implemented security resources to protect our data security and information technology systems, such measures may not prevent such events. In addition, certain measures that could increase the security of our IT system take significant time and resources to deploy broadly, and such measures may not be deployed in a timely manner or be effective against an attack. The inability to implement, maintain and upgrade adequate safeguards could have a material and adverse impact on our business, financial condition and results of operations. Significant disruption to our IT system or breaches of data security could also have a material adverse effect on our business, financial condition and results of operations.

Our facilities and processes may fail to produce renewable gasoline at the volumes, rates and costs we expect.

Some, or all, of our future commercial production facilities may be in locations distant from biomass and MSW, natural gas or other feedstock sources, which could increase our feedstock costs or prevent us from acquiring sufficient feedstock volumes for commercial production. General market conditions might also cause increases in feedstock prices, which could likewise increase our production costs.

Even if we secure access to sufficient volumes of feedstock, our commercial production facilities may fail to perform as expected. The equipment and subsystems that we install in our commercial production facilities may never operate as planned. Unexpected problems may force us to cease or delay production and the time and costs involved with such delays may prove prohibitive. Any or all of these risks could prevent us from achieving the production throughput and yields necessary to achieve our target annualized production run rates and/or to meet the future volume demands or minimum requirements of our customers, including pursuant to definitive supply or distribution agreements that we may enter into, which may subject us to monetary damages. Failure to achieve these rates or meet these minimum requirements, or achieving them only after significant additional expenditures, could substantially harm our commercial performance.

We may in the future use hedging arrangements to mitigate certain risks, but the use of such derivative instruments could have a material adverse effect on our results of operations.

We are likely in the future to use interest rate swaps to manage interest rate risk. In addition, we may use transmission congestion contracts, forward energy sales and other types of hedging contracts, including foreign currency hedges if we do expand into other countries. If we elect to enter into these type of hedging arrangements, our related assets could recognize financial losses on these arrangements as a result of volatility in the market values of the underlying asset or if a counterparty fails to perform under a contract. If actively quoted market prices and pricing information from external sources are not available, the valuation of these contracts would involve judgment or the use of estimates. As a result, changes in the underlying assumptions or use of alternative valuation methods could affect the reported fair value of these contracts. If the values of these financial contracts change in a manner that we do not anticipate, or if a counterparty fails to perform under a contract, it could harm our business, financial condition, results of operations and cash flows.

Business interruptions, including those related to the widespread outbreak of an illness, pandemic (such as COVID-19), adverse weather conditions, manmade problems such as terrorism and other catastrophic events, may have an adverse impact on our business and results of operations.

We are vulnerable to natural disasters and other events that could disrupt our operations. Any of our facilities or future facilities or operations may be harmed or rendered inoperable by catastrophic events, such as natural disasters, including earthquakes, tornadoes, hurricanes, wildfires, floods; nuclear disasters, riots, civil disturbances, war, acts of terrorism or other criminal activities; pandemics (such as COVID-19); power outages and other events beyond our control. We do not have a detailed disaster recovery plan. In addition, we may not carry sufficient business interruption insurance to compensate us for losses that may occur. Any losses or damages we incur could have a material adverse effect on our cash flows and success as an overall business.

In the event of natural disaster or other catastrophic event, we may be unable to continue our operations and may endure production interruptions, reputational harm, delays in manufacturing, delays in the development and testing of our STG+ solutions, and related technologies, and the loss of critical data, all of which could have an adverse effect on our business, prospects, financial condition, and operating results. If our facilities are damaged by such natural disasters or catastrophic events, the repair or replacement would likely be costly and any such efforts would likely require substantial time that may affect our ability to produce and deliver our renewable gasoline. Any future disruptions in our operations could negatively impact our business, prospects, financial condition, and operating results and harm our reputation. In addition, we may not carry enough insurance to compensate for the losses that may occur.

Even if we are successful in completing the first commercial production facility and consistently producing renewable gasoline on a commercial scale, we may not be successful in commencing and expanding commercial operations to support the growth of our business.

Our ability to achieve significant future revenue will depend in large part upon our ability to attract customers and enter into contracts on favorable terms. We expect that many of our customers will be large companies with extensive experience operating in the fuels or chemicals markets. We lack significant commercial operating experience and may face difficulties in developing marketing expertise in these fields. Our business model relies upon our ability to successfully implement the first commercial production facility and commence and expand commercial operations and successfully negotiate, structure and fulfill long-term supply agreements for our renewable gasoline. Agreements with potential customers may initially only provide for the purchase of limited quantities from us. Our ability to increase our sales will depend in large part upon our ability to expand these existing customer relationships into long-term supply agreements. Establishing, maintaining and expanding relationships with customers can require substantial investment without any assurance from customers that they will place significant orders. In addition, many of our potential customers may be more experienced in these matters than we are, and we may fail to successfully negotiate these agreements in a timely manner or on favorable terms which, in turn, may force us to slow our production, dedicate additional resources to increasing our storage capacity and/or dedicate resources to sales in spot markets. Furthermore, should we become more dependent on spot market sales, our profitability will become increasingly vulnerable to short-term fluctuations in the price and demand for petroleum-based fuels and competing substitutes.

We are a development stage company with a history of net losses, we are currently not profitable and we may not achieve or maintain profitability. If we incur substantial losses, we may have to curtail our operations, which may prevent us from successfully operating and expanding our business.

We have incurred net losses since our inception. We are currently in the development stage and have not yet commenced principal operations or generated revenue. We are dependent upon BERR for additional capital to continue the development of our technology and operations.

Furthermore, we expect to spend significant amounts on further development of our technology, acquiring or otherwise gaining access to commercial production facilities, marketing and general and administrative expenses associated with our planned growth and management of operations as a public company. In some market environments, we may have limited access to incremental financing, which could defer or cancel growth projects, reduce business activity or cause us to default under any debt agreements if we are unable to meet our payment schedules. In addition, the cost of preparing, filing, prosecuting, maintaining and enforcing patent, trademark and other intellectual property rights and defending ourselves against claims by others that we may be violating their intellectual property rights may be significant. As a result, even if our revenues increase substantially, we expect that our expenses will exceed revenues for the foreseeable future. We do not expect to achieve profitability during this period, and may never achieve it. If we fail to achieve profitability, or if the time required to achieve profitability is longer than we anticipate, we may not be able to continue our business. Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.

Our actual costs may be greater than expected in developing our commercial production facilities or growth projects, causing us to realize significantly lower profits or greater losses.

We generally must estimate the costs of completing a specific commercial production facility or growth project prior to the construction of the facility or project. The actual cost of labor and materials may vary from the costs we originally estimated. These variations may cause the gross cost for a commercial production facility or growth project to differ from those we originally estimated. Cost overruns on our commercial production facilities and growth projects could occur due to changes in a variety of factors such as:

•        failure to properly estimate costs of engineering, materials, equipment, labor or financing;

•        unanticipated technical problems with the structures, materials or services;

•        unanticipated project modifications;

•        changes in the costs of equipment, materials, labor or contractors;

•        our strategic partners, suppliers’ or contractors’ failure to perform;

•        changes in laws and regulations; and

•        delays caused by weather conditions.

As commercial production facilities or projects grow in size and complexity, multiple factors may contribute to reduced profit or greater losses, and depending on the size of the particular project, variations from the estimated costs could have a material adverse effect on our business. For example, if costs exceed our estimates, it could cause us to realize significantly lower profits or greater losses.

Disruption in the supply chain, including increases in costs, shortage of materials or other disruption of supply, or in the workforce could materially adversely affect our business.

We rely on our suppliers and strategic partners for our business, from feedstocks to materials for our commercial production facilities and our STG+ technology. Future delays or interruptions in the supply chain could expose us to the various risks which would likely significantly increase our costs and/or impact our operations or business plans including:

•        we or our strategic partners may have excess or inadequate inventory of feedstocks for operation of our facilities;

•        we may face delays in construction or development of our growth projects;

•        we may not be able to timely procure parts or equipment to upgrade, replace, or repair our facilities and technology system; and

•        our suppliers may encounter financial hardships unrelated to our demand, which could inhibit their ability to fulfill our orders and meet our requirements.

We may not be able to obtain, or comply with terms and conditions for, government grants, loans, and other incentives for which we may apply for in the future, which may limit our opportunities to expand our business.

We anticipate that in the future there will be new opportunities for us to apply for grants, loans, and other federal and state incentives. Our ability to obtain funds or incentives from government sources is subject to the availability of funds under applicable government programs and approval of our applications to participate in such programs. The application process for these programs and other incentives is and will remain highly competitive. We may not be successful in obtaining any of these additional grants, loans, and other incentives. We may in the future fail to comply with the conditions of these incentives, which could cause us to lose funding or negotiate with governmental entities to revise such conditions. We may be unable to find alternative sources of funding to meet our planned capital needs, in which case, our business, prospects, financial condition, and operating results could be adversely affected.

We may expand our operations globally, which would subject us to anti-corruption, anti-bribery, anti-money laundering, trade compliance, economic sanctions and similar laws, and non-compliance with such laws may subject us to criminal or civil liability and harm our business, financial condition and/or results of operations. We may also be subject to governmental export and import controls that could impair our ability to compete in international markets or subject us to liability if we violate the controls.

If we expand our operations globally, we would be subject to the U.S. Foreign Corrupt Practices Act of 1977, as amended, U.S. domestic bribery laws, and other anti-corruption and anti-money laundering laws in the countries in which we would conduct business. Anti-corruption and anti-bribery laws have been enforced aggressively in recent years and are interpreted broadly to generally prohibit companies, their employees, and their third-party intermediaries from authorizing, offering, or providing, directly or indirectly, improper payments or benefits to recipients in the public or private sector. If we engage in international operations, sales and business with partners and third-party intermediaries to market our products, we may be required to obtain additional permits, licenses, and other regulatory approvals. In addition, we or our third-party intermediaries may have direct or indirect interactions with officials and employees of government agencies or state-owned or affiliated entities. If we engage in international operations, sales and business with the public sector, we can be held liable for the corrupt or other illegal activities of these third-party intermediaries, our employees, agents, representatives, contractors, and partners, even if we do not explicitly authorize such activities.

Failure to protect our intellectual property, inability to enforce our intellectual property rights or loss of our intellectual property rights through costly litigation or administrative proceedings, could adversely affect our ability to compete and our business.

Our success depends in large part on our ability to obtain and maintain patent and other proprietary protection for commercially important inventions, to obtain and maintain know-how related to our business, including our proprietary manufacturing technology, to defend and enforce our intellectual property rights, in particular our patent rights, to preserve the confidentiality of our trade secrets, and to operate without infringing, misappropriating, or violating the valid and enforceable patents and other intellectual property rights of third parties. We rely on various intellectual property rights, including patents, trademarks, and trade secrets, as well as confidentiality provisions and contractual arrangements, and other forms of statutory protection to protect our proprietary rights. We will be able to protect our proprietary rights from unauthorized use by third parties only to the extent that our proprietary technologies and future products are covered by valid and enforceable patents or are effectively maintained as trade secrets. If we do not protect and enforce our intellectual property rights adequately and successfully, our competitive position may suffer, which could have a material adverse effect on our business, prospects, financial condition, and operating results.

Our pending patent or trademark applications may not be approved, or competitors or others may challenge the validity, enforceability, or scope of our patents, the registrability of our trademarks or the trade secret status of our proprietary information. There can be no assurance that additional patents will be issued or that any issued patents will provide significant protection for our intellectual property or for those portions of our proprietary technology and software that are the most key to our competitive positions in the marketplace. In addition, our patents, trademarks, trade secrets, and other intellectual property rights may not provide us a significant competitive advantage. There is no assurance that the forms of intellectual property protection that we seek, including business decisions about when and where to file patents and when and how to maintain and protect trade secrets, license and other contractual rights will be adequate to protect our business.

Moreover, recent amendments to developing jurisprudence and current and possible future changes to intellectual property laws and regulations, including U.S. and foreign patent, trade secret and other statutory law, may affect our ability to protect and enforce our intellectual property rights and to protect our proprietary technology. Despite our precautions, our intellectual property is vulnerable to unauthorized access and copying through employee, contractor or other third-party error or actions, including malicious state or state-sponsored actors, theft, hacking, cybersecurity incidents, and other security breaches and incidents, and such incidents may be difficult to detect or may be unknown for a significant period of time. It is possible for third parties to infringe upon or misappropriate our intellectual property, to copy or reverse engineer our proprietary manufacturing process, and to use information that we regard as proprietary to create products and services that compete with ours.

Intellectual property laws, procedures, and restrictions provide only limited protection and any of our intellectual property rights may be challenged, invalidated, circumvented, infringed, or misappropriated. Further, the laws of certain countries do not protect proprietary rights to the same extent as the laws of the United States, and, therefore, in certain jurisdictions, we may be unable to protect our proprietary technology. Effective patent, trademark and other intellectual property protection may not be available in every country in which our services are made available. To the extent we expand our international activities, our exposure to unauthorized copying and use of our intellectual property and proprietary information may increase. Consequently, we may not be able to prevent third parties from infringing on our intellectual property in all countries outside the U.S., or from selling or importing products made using our intellectual property in and into the U.S. or other jurisdictions. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and may also export infringing products to territories where we have patent protection, but enforcement of patents and other intellectual protection is not as strong as that in the U.S. These products may compete with our products and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.

As we move into new markets and expand our products or services offerings, incumbent participants in such markets may assert their intellectual property and other proprietary rights against us as a means of slowing our entry into such markets or as a means to extract substantial license and royalty payments from us. In addition, our agreements with some of our customers, suppliers or other entities with whom we do business requires us to defend or indemnify these parties to the extent they become involved in infringement claims, including the types of claims described above. As a result, we could incur significant costs and expenses that could adversely affect our business, operating results or financial condition.

We have entered into confidentiality agreements with contractors and consultants as well as agreements containing restrictive covenants and confidentiality provisions with employees of Intermediate, and we may enter into agreements with similar provisions with our employees and with other third parties in the future. We cannot ensure that these agreements, or all the terms thereof, will be enforceable or compliant with applicable law, or otherwise effective in controlling access to, use of, reverse engineering, and distribution of our proprietary information. Further, these agreements with our employees, contractors, and other parties may not prevent other parties from independently developing technologies, products and services that are substantially equivalent or superior to our technologies, products and services.

We derive a substantial portion of our revenue from our proprietary manufacturing technology, which we believe is a unique aspect of our technology in the current market and provides us with a significant competitive advantage. Our ability to prevent competitors from replicating this technology depends on our ability to obtain, maintain, protect, defend and enforce our intellectual property rights in the processes that comprise the technology

and/or keep those processes and the underlying technology secret. We may not be able to prevent competitors from replicating or developing a better version of our proprietary manufacturing technology, which could result in a substantial decrease in our revenue and limit demand for our services.

We may need to spend significant resources securing and monitoring our intellectual property rights, and we may or may not be able to detect infringement by third parties. The steps we take to protect our intellectual property rights may not be sufficient to effectively prevent third parties from infringing, misappropriating, diluting or otherwise violating our intellectual property rights or to prevent unauthorized disclosure or unauthorized use of our trade secrets or other confidential information. Our competitive position may be adversely impacted if we cannot detect infringement or enforce our intellectual property rights quickly or at all. In some circumstances, we may choose not to pursue enforcement because an infringer has a dominant intellectual property position, because of uncertainty relating to the scope of our intellectual property or the outcome of an enforcement action, or for other business reasons. In addition, competitors might avoid infringement by designing around our intellectual property rights or by developing non-infringing competing technologies. Litigation brought to protect and enforce our intellectual property rights could be costly, time-consuming, and distracting to management and our development teams and could result in the impairment or loss of portions of our intellectual property. Further, our efforts to enforce our intellectual property rights may be met with defenses, counterclaims attacking the scope, validity, and enforceability of our intellectual property rights, or with counterclaims and countersuits asserting infringement by us of third-party intellectual property rights. Our failure to secure, protect, and enforce our intellectual property rights could adversely affect our brand and our business, any of which could have an adverse effect on our business, prospects, financial condition, and operating results.

Agreements containing confidentiality provisions and restrictive covenants with employees, contractors, consultants and other third-parties may not adequately prevent disclosures of trade secrets and other proprietary information.

We rely in part on trade secret protection to protect our confidential and proprietary information and processes. However, trade secrets are difficult to protect. We have taken measures to protect our trade secrets and proprietary information, but these measures may not be effective. Our employees have agreed to restrictive covenants and other confidentiality provisions and our consultants and contractors are required to enter into confidentiality agreements with us. We cannot guarantee that we have entered into such agreements with each party who has developed intellectual property on our behalf and each party that has or may have had access to our confidential information, know-how and trade secrets. We intend for new employees, consultants and other third parties to execute confidentiality agreements or agreements containing confidentiality provisions upon the commencement of an employment or consulting arrangement with us. These agreements generally require that all confidential information developed by the individual or made known to the individual by us during the course of the individual’s relationship with us be kept confidential and not disclosed to third parties. These agreements also generally provide that know-how and inventions conceived by the individual in the course of rendering services to us shall be our exclusive property. Nevertheless, these agreements may be insufficient or breached, or may not be enforceable, our proprietary information may be disclosed, third parties could reverse engineer our biocatalysts and others may independently develop substantially equivalent proprietary information and techniques or otherwise gain access to our trade secrets. Moreover, these agreements may not provide an adequate remedy for breaches or in the event of unauthorized use or disclosure of our confidential information or technology. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive business position. In addition, trade secrets and know-how can be difficult to protect and some courts inside and outside of the United States are less willing or unwilling to protect trade secrets and know-how. If any of our trade secrets were to be lawfully obtained or independently developed by a competitor or other third party, we would not be able to prevent them from using that technology or information to compete with us, and our competitive position could be materially and adversely harmed. An unauthorized breach in our information technology systems may expose our trade secrets and other proprietary information to unauthorized parties.

Obtaining and maintaining our patent protection depends on compliance with various procedural, documentary, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.

The United States Patent and Trademark Office, or USPTO, and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent prosecution process. When related patents are pursued concurrently in multiple jurisdictions, international treaties may impose additional procedural, documentary, fee payment and other provisions. Periodic maintenance or annuity fees and various other governmental fees on any issued patent and/or pending patent applications are due to be paid to the USPTO and foreign patent agencies in several stages over the lifetime of a patent or patent application. Our outside counsel has systems in place to remind us to pay these fees, and we rely on our outside counsel and their third party vendors to pay these fees. While an inadvertent lapse may sometimes be cured by payment of a late fee or by other means in accordance with the applicable rules, there are many situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction.

Non-compliance events that could result in abandonment or lapse of a patent or patent application include failure to respond to official actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents. If we fail to maintain the patents and patent applications directed to our proprietary technology, our competitors might be able to enter the market, which could harm our business, financial condition, results of operations, and prospects.

Changes in patent law could diminish the value of patents in general, thereby impairing our ability to protect our technology.

Our success is dependent on intellectual property, particularly patents. Obtaining and enforcing patents in our industry involves both technological and legal complexity and is therefore costly, time-consuming and inherently uncertain, due in part to ongoing changes in patent laws. Depending on decisions by Congress, the federal courts and the USPTO, and equivalent institutions in other jurisdictions, the laws and regulations governing patents, and interpretation thereof, could change in unpredictable ways that could weaken our ability to obtain new patents or to enforce existing or future patents. We cannot predict future changes in the interpretation of patent laws or changes to patent laws that might be enacted into law. Those changes may materially affect our patents or patent applications and our ability to obtain additional patent protection in the future.

Patent law can be highly uncertain and involve complex legal and factual questions for which important principles remain unresolved. In the United States and in many international jurisdictions, policy regarding the breadth of claims allowed in patents can be inconsistent. The U.S. Supreme Court and the Court of Appeals for the Federal Circuit have made, and will likely continue to make, changes in how they interpret the patent laws of the United States. Similarly, international courts have made, and will likely continue to make, changes in how they interpret the patent laws in their respective jurisdictions. We cannot predict future changes in the interpretation of patent laws or changes to patent laws that might be enacted into law by U.S. and international legislative bodies. Those changes may materially affect our patent rights and our ability to obtain issued patents.

We may be subject to intellectual property rights claims by third parties, which could be costly to defend, could require us to pay significant damages and, if we are unsuccessful in defending such claims, could limit our ability to use certain technologies and compete.

Third parties may assert claims of infringement of intellectual property rights or violation of other statutory, license or contractual rights in technology against us or against our customers for which we may be liable or have an indemnification obligation. Any such claim by a third party, even if without merit, could cause us to incur substantial costs defending against such claim and could distract our management and our development teams from our business.

Although third parties may offer a license to their technology the terms of any offered license may not be acceptable and the failure to obtain a license or the costs associated with any license could cause our business, prospects, financial condition, and operating results to be adversely affected. In addition, some licenses may be non-exclusive, and therefore our competitors may have access to the same technology licensed to us. Alternatively, we may be required to develop non-infringing technology which could require significant effort and expense and

ultimately may not be successful. Furthermore, a successful claimant could secure a judgment or we may agree to a settlement that prevents us from selling certain products or performing certain services or that requires us to pay substantial damages, including treble damages if we are found to have willfully infringed such claimant’s patents, copyrights, trade secrets or other statutory rights, royalties or other fees. Any of these events could have an adverse effect on our business, prospects, financial condition, and operating results.

We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information or alleged trade secrets of third parties or competitors or are in breach of noncompetition or non-solicitation agreements with our competitors or their former employers.

We also may employ or otherwise engage personnel who were previously or are concurrently employed or engaged at research institutions or other clean technology companies, including our competitors or potential competitors. We may be subject to claims that these personnel, or we, have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of their former or concurrent employers, or that patents and applications we have filed to protect inventions of these personnel, even those related to our technology, are rightfully owned by their former or concurrent employer. Litigation may be necessary to defend against these claims. Even if we are successful in defending against these claims, litigation could adversely affect our operations, result in substantial costs and be a distraction to management.

Our business and prospects depend significantly on our ability to build our brand. We may not succeed in continuing to establish, maintain, and strengthen our brand, and our brand and reputation could be harmed by negative publicity regarding our company or products.

Our business and prospects are dependent on our ability to develop, maintain, and strengthen the Verde Clean Fuels brand. Promoting and positioning our brand will depend significantly on our ability to provide high quality clean, renewable gasoline. In addition, we expect that our ability to develop, maintain, and strengthen our brand will also depend heavily on the success of our branding efforts. To promote our brand, we need to incur increased expenses, such as the costs associated with conducting product demonstrations and attending trade conferences. Brand promotion activities may not yield increased revenue, and even if they do, the increased revenue may not offset the expenses we incur in building and maintaining our brand and reputation. If we fail to promote and maintain our brand successfully or to maintain loyalty among our customers, or if we incur substantial expenses in an unsuccessful attempt to promote and maintain our brand, we may fail to attract new customers and partners, or retain our existing customers and partners and our business and financial condition may be adversely affected.

We also believe that the protection of our trademark rights is an important factor in product recognition, protecting our brand and maintaining goodwill. We may be unable to obtain trademark protection for our technologies, logos, slogans and brands, and our existing trademark registrations and applications, and any trademarks that may be used in the future, may not provide us with competitive advantages or distinguish our products and services from those of our competitors. Further, we may not timely or successfully register our trademarks. If we do not adequately protect our rights in our trademarks from infringement and unauthorized use, any goodwill that we have developed in those trademarks could be lost or impaired, which could harm our brand and our business.

Moreover, any negative publicity relating to our employees, current or future partners, our STG+ technology, our clean, renewable gasoline, or customers who use our technology or gasoline, or others associated with these parties may also tarnish our own reputation simply by association and may reduce the value of our brand. Additionally, if safety or other incidents or defects in our gasoline occur or are perceived to have occurred, whether or not such incidents or defects are our fault, we could be subject to adverse publicity, which could be particularly harmful to our business given our limited operating history. Given the popularity of social media, any negative publicity about our products, whether true or not, could quickly proliferate and harm customer and community perceptions and confidence in our brand. Other businesses, including our competitors, may also be incentivized to fund negative campaigns against our company to damage our brand and reputation to further their own purposes. Future customers of our products and services may have similar sensitivities and may be subject to similar public opinion and perception risks. Damage to our brand and reputation may result in reduced demand for our products and increased risk of losing market share to our competitors. Any efforts to restore the value of our brand and rebuild our reputation may be costly and may not be successful, and our inability to develop and maintain a strong brand could have an adverse effect on our business, prospects, financial condition, and operating results.

If we fail to comply with our obligations under license or technology agreements with third parties or are unable to license rights to use technologies on reasonable terms, we may be required to pay damages and could potentially lose license rights that are critical to our business.

We license certain intellectual property, including technologies, data, content and software from third parties, that is important to our business, and in the future we may enter into additional agreements that provide us with licenses to valuable intellectual property or technology. If we fail to comply with any of the obligations under our license agreements, we may be required to pay damages and the licensor may have the right to terminate the license. Termination by the licensor would cause us to lose valuable rights, and could prevent us from selling our products and services, or inhibit our ability to commercialize future products and services. Our business would suffer if any current or future licenses terminate, if the licensors fail to abide by the terms of the license, if the licensed intellectual property rights are found to be invalid or unenforceable, or if we are unable to enter into necessary licenses on acceptable terms. Moreover, our licensors may own or control intellectual property that has not been licensed to us and, as a result, we may be subject to claims, regardless of their merit, that we are infringing or otherwise violating the licensor’s rights.

In the future, we may identify additional third-party intellectual property we may need to license in order to engage in our business. However, such licenses may not be available on acceptable terms or at all. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more-established companies may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive or necessary. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. Even if such licenses are available, we may be required to pay the licensor substantial royalties based on sales of our products and services. Such royalties are a component of the cost of our products or services and may affect the margins on our products and services. In addition, such licenses may be non-exclusive, which could give our competitors access to the same intellectual property licensed to us. Any of the foregoing could have a material adverse effect on our competitive position, business, financial condition and results of operations.

Our projections are subject to significant risks, assumptions, estimates and uncertainties, including assumptions regarding adoption of renewable fuels. As a result, our projected revenues, market share, expenses and profitability may differ materially from our expectations in any given quarter or fiscal year.

We operate in rapidly changing and competitive industries and our projections are subject to the risks and assumptions made by management with respect to our industries. Operating results are difficult to forecast as they generally depend on our assessment of the timing of adoption of commercial renewable fuel technologies, which is uncertain. Furthermore, as we invest in the development of our commercial production facilities that have yet to achieve commercial success, we may not recover the often substantial up-front costs of developing these facilities or recover the opportunity cost of diverting management and financial resources away from other projects. Additionally, our business may be affected by reductions in consumer demand as a result of a number of factors which may be difficult to predict. Similarly, our assumptions and expectations with respect to margins and the pricing of our renewable gasoline may not prove to be accurate as a result of competitive pressures or customer demands. This may result in decreased revenue, and we may be unable to adopt measures in a timely manner to compensate for any unexpected shortfall in revenue. This inability could cause our operating results in a given quarter or year to be higher or lower than expected.

If our estimates or judgments relating to our critical accounting policies prove to be incorrect or financial reporting standards or interpretations change, our operating results could be adversely affected.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments, and assumptions that affect the amounts reported in our financial statements and accompanying notes. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, as described in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Intermediate.” The results of these estimates form the basis for making judgments about the carrying values of assets, liabilities, and equity as of the date of the financial statements, and the amount of revenue and expenses, during the periods presented, that are not readily apparent from other sources. Significant assumptions and estimates used in preparing our financial statements include those related to determination of revenue recognition, stock-based compensation, inventory, warranties, and accounting for

income taxes. Our operating results may be adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our operating results to fall below the expectations of industry or financial analysts and investors, resulting in a decline in the trading price of our common stock.

Additionally, we regularly monitor our compliance with applicable financial reporting standards and review new pronouncements and drafts thereof that are relevant to us. As a result of new standards, changes to existing standards, and changes in interpretation, we might be required to change our accounting policies, alter our operational policies, or implement new or enhance existing systems so that they reflect new or amended financial reporting standards, or we may be required to restate our published financial statements. Changes to existing standards or changes in their interpretation may have an adverse effect on our reputation, business, financial position, and profit, or cause an adverse deviation from our revenue and operating profit target, which may negatively impact our financial results.

Inflation may adversely affect us by increasing costs of our business.

Inflation can adversely affect us by increasing costs of feedstock, equipment, materials, and labor. In addition, inflation is often accompanied by higher interest rates. In an inflationary environment, such as the current economic environment, depending on other economic conditions, we may be unable to raise prices of our fuels or products to keep up with the rate of inflation, which would reduce our profit margins. Given the inflation rates thus far in 2022, we have experienced, and continue to experience, increases in prices of feedstock, equipment, materials, and labor. Continued inflationary pressures could impact our profitability.

Our industry and its technologies are rapidly evolving and may be subject to unforeseen changes and developments in alternative technologies may adversely affect the demand for renewable gasoline. If we fail to make the right investment decisions in our technologies and products, we may be at a competitive disadvantage.

The renewable fuels industry is relatively new and has experienced substantial change in the last several years. As more companies invest in renewable energy technology and alternative energy sources, we may be unable to keep up with technology advancements and, as a result, our competitiveness may suffer. As technologies change, we plan to spend significant resources in ongoing research and development, and to upgrade or adapt our renewable gasoline, and introduce new products and services in order to continue to provide renewable gasoline, and related technologies with the latest technology. Our research and development efforts may not be sufficient or could involve substantial costs and delays and lower our return on investment for our technologies. Delays or missed opportunities to adopt new technologies could adversely affect our business, prospects, financial condition, and operating results.

In addition, we may not be able to compete effectively with other alternative fuel products and integrate the latest technology into our STG+ process and related technologies. Even if we are able to keep pace with changes in technology and develop new products, we are subject to the risk that our prior products and production process will become obsolete more quickly than expected, resulting in less efficient facilities and potentially reducing our return on investment. Moreover, developments in alternative technologies, such as advanced diesel, ethanol, hydrogen fuel cells, or compressed natural gas, or improvements in the fuel economy of the internal combustion engine, may adversely affect our business and prospects in ways we do not currently anticipate. Any developments with respect to these technologies and related renewables research, or the perception that they may occur, may prompt us to invest heavily in additional research to compete effectively with these advances, which research and development may not be effective. Any failure by us to successfully react to changes in existing technologies could adversely affect our competitive position and growth prospects.

Concerns regarding the environmental impact of renewable gasoline production could affect public policy which could impair our ability to operate at a profit and substantially harm our revenues and operating margins.

Under the Energy Independence and Security Act, the U.S. Environmental Protection Agency (the “EPA”) is required to produce a study every three years of the environmental impacts associated with current and future biofuel production and use, including effects on air and water quality, soil quality and conservation, water availability, energy recovery from secondary materials, ecosystem health and biodiversity, invasive species and international impacts. Should such EPA triennial studies, or other analyses find that biofuel production and use has resulted in, or could in the future result in, adverse environmental impacts, such findings could also negatively impact public

perception and acceptance of biofuel as an alternative fuel, which also could result in the loss of political support. To the extent that state or federal laws are modified or public perception turns against biofuels, use requirements such as RFS and LCFS may not continue, which could materially harm our ability to operate profitably.

We have identified material weaknesses in our internal control over financial reporting. If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results, and we may face litigation as a result.

In connection with the preparation of Intermediate’s financial statements for the year ended December 31, 2021 and the period from July 31, 2020 (inception) to December 31, 2020, management of Intermediate noted a material weakness in our internal control over financial reporting. Management did not maintain effective internal control over the reconciliation of the final fair value of the unit-based compensation awards prepared by third party valuation specialists to the accounting records due to a lack of professionals with defined roles within the accounting function providing financial reporting oversight. Additionally, Intermediate did not maintain effective internal control regarding the date on which to apply new accounting standards based upon CENAQ’s elections made under the JOBS Act, which required Intermediate to apply new accounting standards as if it were a public business entity. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented, or detected and corrected, on a timely basis. Effective internal controls are necessary to provide reliable financial reports and prevent fraud, and material weaknesses could limit the ability to prevent or detect a misstatement of accounts or disclosures that could result in a material misstatement of annual or interim financial statements. Bluescape Clean Fuels Intermediate Holdings, LLC’s management continues to evaluate steps to remediate the material weaknesses. These remediation measures may be time consuming and costly and there is no assurance that these initiatives will ultimately have the intended effects.

If we lose key personnel, including key management personnel, or are unable to attract and retain additional personnel, it could delay our development and harm our research, make it more difficult to pursue partnerships or develop our own products or otherwise have a material adverse effect on our business.

Our business is complex and we intend to target a variety of markets. Therefore, it is critical that our management team and employee workforce are knowledgeable in the areas in which we operate. The departure, illness or absence of any key members of our management, including our named executive officers, or the failure to attract or retain other key employees who possess the requisite expertise for the conduct of our business, could prevent us from developing and commercializing our renewable gasoline for our target markets and entering into partnership arrangements to execute our business strategy. In addition, the loss of any key scientific staff, or the failure to attract or retain other key scientific employees, could prevent us from developing and commercializing our renewable gasoline for our target markets and entering into partnership arrangements to execute our business strategy. All of our employees are at-will employees, meaning that either the employee or we may terminate their employment at any time.

We also engage a number of individuals as independent contractors to provide certain material scientific and engineering services. The failure to retain access to the services provided by these individuals, or to attract and retain individuals to provide consulting or other services, could also delay or prevent us from developing and commercializing our renewable gasoline for our target markets and entering into partnership arrangements to execute our business strategy, and otherwise executing on our business plans.

Our management team has limited experience in operating a public company.

Our executive officers have limited experience in the management of a publicly traded company. Our management team may not successfully or effectively manage our transition to a public company that will be subject to significant regulatory oversight and reporting obligations under federal securities laws. We may not have adequate personnel with the appropriate level of knowledge, experience, and training in the policies, practices or internal controls over financial reporting required of public companies in the United States. As a result, we may be required to pay higher outside legal, accounting or consulting costs than our competitors, and our management team members may have to devote a higher proportion of their time to issues relating to compliance with the laws applicable to public companies, both of which might put us at a disadvantage relative to competitors.

We will incur significant increased expenses and administrative burdens as a public company, which could have an adverse effect on our business, financial condition and results of operations.

We will face increased legal, accounting, administrative and other costs and expenses as a public company that we did not incur as a private company. The Sarbanes-Oxley Act, including the requirements of Section 404, as well as rules and regulations subsequently implemented by the SEC, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the rules and regulations promulgated and to be promulgated thereunder, the PCAOB and the securities exchanges, impose additional reporting and other obligations on public companies. The development and implementation of the standards and controls necessary for us to achieve the level of accounting standards required of a public company in the United States may require costs greater than expected. It is possible that we will be required to expand our employee base and hire additional employees to support our operations as a public company, which will increase our operating costs in future periods.

Compliance with public company requirements will increase costs and make certain activities more time-consuming. A number of those requirements will require us to carry out activities we have not done previously. For example, we have created, or will create, new board committees and adopted, or will adopt, new internal controls and disclosure controls and procedures. In addition, we will incur expenses associated with SEC reporting requirements. Furthermore, if any issues in complying with those requirements are identified (for example, if management or the auditors identify a material weakness or significant deficiency in the internal control over financial reporting), we could incur additional costs rectifying those issues, and the existence of those issues could adversely affect our reputation or investor perceptions of it. It will also be more expensive to obtain director and officer liability insurance. The additional reporting and other obligations imposed by these rules and regulations will increase legal and financial compliance costs and the costs of related legal, accounting and administrative activities. These increased costs will require us to spend money that could otherwise be used on our research and development programs and to achieve strategic objectives. Advocacy efforts by stockholders and third parties may also prompt additional changes in governance and reporting requirements, which could further increase costs.

The requirements of being a public company may strain Verde Clean Fuels’ resources, divert management’s attention and affect its ability to attract and retain qualified board members and officers.

As a public company after the completion of the business combination, Verde Clean Fuels will be subject to the reporting requirements of the Exchange Act, the listing requirements of the Nasdaq Capital Market, and other applicable securities rules and regulations. Compliance with these rules and regulations will increase its legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on Verde Clean Fuels’ systems and resources. The Exchange Act requires, among other things, that Verde Clean Fuels file annual, quarterly and current reports with respect to its business and results of operations and maintain effective disclosure controls and procedures and internal control over financial reporting. To maintain and, if required, improve Verde Clean Fuels’ disclosure controls and procedures and internal control over financial reporting to meet this standard, significant resources and management oversight may be required. Similar resources and management oversight may also be required to monitor regulatory developments at the SEC that may impose new disclosure requirements. As a result, management’s attention may be diverted from other business concerns, which could harm Verde Clean Fuels’ business and results of operations. Verde Clean Fuels may need to hire more employees or engage additional consultants to assist in public company compliance matters, which would increase its costs and expenses.

We will be a “controlled company” within the meaning of Nasdaq Capital Market rules and, as a result, qualify for exemptions from certain corporate governance requirements. As a result, you do not have the same protections afforded to stockholders of companies that are not exempt from such corporate governance requirements.

After the Closing, over 50% of our voting power for the election of directors will be held by an individual, group or another company. As a result, we will be a controlled company within the meaning of Nasdaq Capital Market corporate governance standards. Under Nasdaq Capital Market rules, a controlled company may elect not to comply with certain Nasdaq corporate governance requirements, including the requirements that:

•        a majority of the board consist of independent directors under Nasdaq Capital Market rules;

•        the nominating and governance committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and

•        the compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.

These requirements will not apply to us as long as we remain a controlled company. Following the Closing, we may utilize some or all of these exemptions. Accordingly, you may not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of Nasdaq Capital Market.

From time to time, we may be involved in litigation, regulatory actions or government investigations and inquiries, which could have an adverse impact on our profitability and consolidated financial position.

We may be involved in a variety of litigation, other claims, suits, regulatory actions or government investigations and inquiries and commercial or contractual disputes that, from time to time, are significant. In addition, from time to time, we may also be involved in legal proceedings and investigations arising in the normal course of business including, without limitation, commercial or contractual disputes, including warranty claims and other disputes with potential customers, former employees and suppliers, intellectual property matters, personal injury claims, environmental issues, tax matters, and employment matters. It is difficult to predict the outcome or ultimate financial exposure, if any, represented by these matters, and there can be no assurance that any such exposure will not be material. Such claims may also negatively affect our reputation.

Risks Related to CENAQ

The risks discussed herein have been identified by CENAQ’s management based on an evaluation of the historical risks faced by Intermediate and relate to CENAQ management’s current expectations as to future risks that may result from CENAQ’s anticipated ownership of Intermediate. Unless the context otherwise requires, all references in this section to “we,” “us” or “our” refer to CENAQ.

Risks Related to Our Business, Operations and Industry

The loss of our senior management or technical personnel could adversely affect our ability to successfully effect the business combination and successfully operate Verde Clean Fuels’ business thereafter.

Our ability to successfully effect the business combination is dependent upon the efforts of our key personnel. Although some of our key personnel may hold senior management or advisory positions in Verde Clean Fuels following our business combination, it is likely that some or all of current the management of Intermediate will remain in place. While we intend to closely scrutinize any individuals we engage after the business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources helping them become familiar with such requirements. The loss of the services of our senior management or technical personnel could have a material adverse effect on Verde Clean Fuels’ business, financial condition and results of operations. Verde Clean Fuels will also be dependent, in part, upon Intermediate’s technical personnel in connection with operating the business following the business combination. A loss by Intermediate of its technical personnel could seriously harm Verde Clean Fuels’ business and results of operations.

There are inherent limitations in all control systems, and misstatements due to error or fraud that could seriously harm Verde Clean Fuels’ business may occur and not be detected.

CENAQ’s management does not expect that CENAQ’s internal and disclosure controls will prevent all possible error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. In addition, the design of a control system must reflect the fact that there are resource constraints and the benefit of controls must be relative to their costs. Because of the inherent limitations in all control systems, an evaluation of controls can only provide reasonable assurance that all material control issues and instances of fraud, if any, in CENAQ have been detected.

These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Further, controls can be circumvented by the individual acts of some persons or by collusion of two or more persons. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will

succeed in achieving its stated goals under all potential future conditions. Because of inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. CENAQ will also be dependent, in part, upon Intermediate’s internal controls. A failure of CENAQ’s or Intermediate’s controls and procedures to detect error or fraud could seriously harm Verde Clean Fuels’ business and results of operations.

Cyber incidents or attacks directed at us could result in information theft, data corruption, operational disruption and/or financial loss.

We depend on digital technologies, including information systems, infrastructure and cloud applications and services, including those of third parties with which we may deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data. As an early-stage company without significant investments in data security protection, we may not be sufficiently protected against such occurrences. We may not have sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have adverse consequences on our business and lead to financial loss. CENAQ will also be dependent, in part, upon Intermediate’s information. A failure in the security of Intermediate’s information systems could seriously harm Verde Clean Fuels’ business and results of operations.

We have not registered the shares of Class A Common Stock issuable upon exercise of the warrants under the Securities Act or any state securities laws, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor from being able to exercise its warrants except on a cashless basis and potentially causing such warrants to expire worthless.

We have not registered the shares of Class A Common Stock issuable upon exercise of the warrants under the Securities Act or any state securities laws. However, under the terms of the warrant agreement governing the terms of our warrants, we have agreed that as soon as practicable after the closing of an Initial Business Combination, we will use our best efforts to file, and within 60 business days following our Initial Business Combination to have declared effective, a registration statement under the Securities Act covering such shares. We will use our best efforts to cause the same to become effective and to maintain the effectiveness of such registration statement, until the expiration of the warrants in accordance with the provisions of the warrant agreement. We cannot assure you that we will be able to do so if, for example, any facts or events arise which represent a fundamental change in the information set forth in the registration statement or prospectus, the financial statements contained or incorporated by reference therein are not current or correct or the SEC issues a stop order. If the shares issuable upon exercise of the warrants are not registered under the Securities Act within the required period, holders will be permitted to exercise their warrants on a cashless basis until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement. However, no warrant will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available. In no event will we be required to net cash settle any warrant. If the issuance of the shares upon exercise of the warrants is not so registered or qualified or exempt from registration or qualification, the holder of such warrant shall not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid the full unit purchase price solely for the shares of Class A Common Stock included in the units. If and when the warrants become redeemable by us, we may not exercise our redemption right if we are unable to register or qualify the underlying shares of Class A Common Stock for sale under all applicable state securities laws.

Risks Related to CENAQ and the Business Combination

Upon consummation of the business combination, Holdings will own the majority of Verde Clean Fuels’ voting stock and will have the right to appoint a majority of Verde Clean Fuels’ board members, and its interests may conflict with those of other stockholders.

Following the consummation of the business combination, Holdings will own the majority of Verde Clean Fuels’ voting stock and will initially be entitled to appoint the majority of the Verde Clean Fuels Board. As a result, Holdings will be able to substantially influence matters requiring Verde Clean Fuels stockholder or board approval,

including the election of directors, approval of any potential acquisition of Verde Clean Fuels, changes to Verde Clean Fuels’ organizational documents and significant corporate transactions. This concentration of ownership makes it unlikely that any other holder or group of holders of Class A Common Stock will be able to affect the way Verde Clean Fuels is managed or the direction of its business. The interests of Holdings with respect to matters potentially or actually involving or affecting Verde Clean Fuels, such as future acquisitions, financings and other corporate opportunities and attempts to acquire Verde Clean Fuels, may conflict with the interests of Verde Clean Fuels’ other stockholders.

For example, Holdings may have different tax positions from Verde Clean Fuels, especially in light of the Tax Receivable Agreement, that could influence its decisions regarding whether and when to support the disposition of assets, the incurrence or refinancing of new or existing indebtedness, or the termination of the Tax Receivable Agreement and acceleration of Verde Clean Fuels’ obligations thereunder. In addition, the determination of future tax reporting positions, the structuring of future transactions and the handling of any challenge by any taxing authority to Verde Clean Fuels’ tax reporting positions may take into consideration tax or other considerations of Holdings, including the effect of such positions on Verde Clean Fuels’ obligations under the Tax Receivable Agreement, which may differ from the considerations of Verde Clean Fuels or other stockholders. See the section entitled “Proposal No. 1 — The Business Combination Proposal — Related Documents — Tax Receivable Agreement.”

Subsequent to the consummation of the business combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and stock price, which could cause you to lose some or all of your investment.

Although we have conducted due diligence on Intermediate, we cannot assure you that this diligence revealed all material issues that may be present in Intermediate, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of our control will not later arise. As a result, we may be forced to later write-down or write-off assets, restructure our operations or incur impairment or other charges that could result in losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and may not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us following the completion of the business combination or our securities. In addition, charges of this nature may cause us to be unable to obtain future financing on favorable terms or at all. Accordingly, any stockholders who choose to remain stockholders following the business combination could suffer a reduction in the value of their shares. Such stockholders are unlikely to have a remedy for such reduction in value.

Our Sponsor, the underwriters and the Anchor Investors have agreed to vote in favor of the business combination, regardless of how our Public Stockholders vote.

Unlike many other blank check companies in which the founders agree to vote their Founder Shares in accordance with the majority of the votes cast by our Public Stockholders in connection with an Initial Business Combination, our Sponsor has agreed to vote any shares of Class A Common Stock and Class B Common Stock, including the Founder Shares, owned by it in favor of the business combination. In addition, the underwriters have agreed to vote any shares of Class A Common Stock owned by them in favor of the business combination and the Anchor Investors have agreed to vote the Founder Shares owned by them in favor of the business combination. As of the date hereof, our Sponsor, the underwriters and the Anchor Investors owns shares equal to approximately 21% of our issued and outstanding shares of Class A Common Stock and Class B Common Stock in the aggregate. Accordingly, it is more likely that the necessary stockholder approval will be received for the business combination than would be the case if our Sponsor and the underwriters agreed to vote any shares of Class A Common Stock and Class B Common Stock owned by them, and the Anchor Investors agreed to vote their Founder Shares, in accordance with the majority of the votes cast by our Public Stockholders.

Our Sponsor, certain members of the CENAQ Board and our officers have interests in the business combination that are different from or are in addition to other stockholders in recommending that stockholders vote in favor of approval of the Business Combination Proposal.

When considering the CENAQ Board’s recommendation that our stockholders vote in favor of the approval of the Business Combination Proposal, our stockholders should be aware that our directors and officers have interests in the business combination that may be different from, or in addition to, the interests of our stockholders. These interests include:

•        the fact that our Sponsor holds an aggregate of 4,950,000 Private Placement Warrants (including the Sponsor Forfeited Warrants) that would expire worthless if a business combination is not consummated, which if unrestricted and freely tradable would be valued at approximately $            , based on the closing price of our Public Warrants of $            per warrant on            , 2022, the record date for the special meeting, resulting in a theoretical gain of $            ;

•        the fact that our Sponsor, officers and directors have agreed not to redeem any of the shares of our common stock held by them in connection with a stockholder vote to approve the business combination;

•        the fact that our Sponsor originally paid $25,000 for 4,312,500 Founder Shares and subsequently sold 825,000 Founder Shares to the Anchor Investors in the IPO for the original purchase price of $0.0058 per share resulting in our Sponsor paying $20,215 for 3,487,500 Founder Shares and that such securities will have a significantly higher value at the time of the business combination, which if unrestricted and freely tradable would be valued at approximately $            , based on the closing price of our Class A Common Stock of $            per share on            , 2022, the record date for the special meeting, resulting in a theoretical gain of $            ;

•        the fact that CENAQ’s officers and directors collectively own, directly or indirectly, a material interest in our Sponsor;

•        the anticipated appointment of two additional directors to be named by Sponsor to the Verde Clean Fuels Board in connection with the Closing;

•        if the Trust Account is liquidated, including in the event we are unable to complete an Initial Business Combination within the required time period, our Sponsor has agreed to indemnify us to ensure that the proceeds in the Trust Account are not reduced below $10.10 per public share, or such lesser amount per public share as is in the Trust Account on the liquidation date, by the claims of (a) any third party for services rendered or products sold to us or (b) a prospective target business with which we have entered into an acquisition agreement, but only if such a third party or target business has not executed a waiver of all rights to seek access to the Trust Account;

•        the fact that our Sponsor will benefit from the completion of a business combination and may be incentivized to complete an acquisition of a less favorable target company or on terms less favorable to stockholders rather than liquidate;

•        the fact that our Sponsor and its affiliates can earn a positive rate of return on their investment if the trading price of our Class A Common Stock is $1.43 or more per share and the Private Placement Warrants are worthless, even if other CENAQ stockholders experience a negative rate of return in the post-business combination company;

•        the fact that our Sponsor, officers and directors will be reimbursed for out-of-pocket expenses incurred in connection with activities on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations; and

•        the fact that our Sponsor, officers and directors will lose their entire investment in us if an Initial Business Combination is not completed.

At the Closing, we anticipate that our Sponsor will own 2,475,000 Private Placement Warrants (after taking into account the Sponsor Forfeited Warrants) and 3,487,500 shares of Class A Common Stock (3,234,375 shares of which will be subject to forfeiture). In addition, on May 31, 2022, we issued an unsecured promissory note in the principal amount of $125,000 to our Sponsor. The note does not bear interest and is repayable in full upon the earlier of (i) February 17, 2023 or (ii) the consummation of an Initial Business Combination. The note is subject to customary events of default, the occurrence of which automatically trigger the unpaid principal balance of the note and all other sums payable with regard to the note becoming immediately due and payable.

Further, as of the date of this proxy statement, our Sponsor or an affiliate thereof, officers and directors have incurred approximately $10,000 out of pocket expenses on CENAQ’s behalf, all of which has been repaid by CENAQ.

Investors in our Sponsor, each of which contributed capital to our Sponsor in exchange for Founder Shares and Private Placement Warrants, include our officers and directors.

The table set forth below summarizes the interests of our officers and directors in the Private Placement Warrants and Founder Shares along with (i) the total investment made in our Sponsor by each officer and director in exchange for their interests in the Private Placement Warrants and Founder Shares and (ii) the value of such interests based on the closing price of the Public Warrants and Class A Common Stock as of            , 2022, all of which would be lost if an Initial Business Combination is not completed by us within the required time period:

____________

(1)      The number of Private Placement Warrants does not take into account the Sponsor Forfeited Warrants.

In addition, our Charter provides that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. We do not believe, however, that this waiver of the corporate opportunities doctrine has materially affected our search for an acquisition target or will materially affect our ability to complete our business combination.

Our Sponsor holds a significant number of shares of our common stock and a significant number of our warrants. Our Sponsor will lose its entire investment in us if we do not complete an Initial Business Combination.

Our Sponsor holds 3,487,500 Founder Shares, representing 16% of the total outstanding shares upon completion of our IPO. The Founder Shares will be worthless if we do not complete an Initial Business Combination by November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension). In addition, our Sponsor holds an aggregate of 4,950,000 Private Placement Warrants that will also be worthless if we do not complete an Initial Business Combination by November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension).

The Founder Shares are identical to the shares of Class A Common Stock included in the units, except that (a) the Founder Shares are subject to certain transfer restrictions, (b) our Sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their Redemption Rights with respect to their Founder Shares and public shares owned in connection with the completion of an Initial Business Combination and (ii) to waive their rights to liquidating distributions from the Trust Account with respect to their

Founder Shares if we fail to complete an Initial Business Combination by November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension) (although they will be entitled to liquidating distributions from the Trust Account with respect to any public shares they hold if we fail to complete an Initial Business Combination by November 16, 2022 or February 16, 2023, as applicable) and (c) the Founder Shares are automatically convertible into shares of our Class A Common Stock at the time of an Initial Business Combination, as described herein.

The personal and financial interests of our Sponsor may have influenced its motivation in identifying and selecting the business combination, completing the business combination and influencing our operation following the business combination.

We will incur significant transaction costs in connection with the business combination.

We have and expect to incur significant, non-recurring costs in connection with consummating the business combination. All expenses incurred in connection with the Business Combination Agreement and the business combination, including all legal, accounting, consulting, investment banking and other fees, expenses and costs, will be for the account of the party incurring such fees, expenses and costs. Our transaction expenses as a result of the business combination are currently estimated at approximately $12.63 million, including approximately $4.3 million in deferred underwriting discounts and commissions to the underwriters of our IPO.

We may be subject to business uncertainties while the business combination is pending.

Uncertainty about the effect of the business combination on employees and third parties may have an adverse effect on CENAQ and Intermediate. These uncertainties may impair the ability to retain and motivate key personnel and could cause third parties that deal with Intermediate to defer entering into contracts or making other decisions or seek to change existing business relationships.

The unaudited pro forma condensed combined financial information included in this document may not be indicative of what our actual financial position or results of operations would have been.

The unaudited pro forma condensed combined financial information for Verde Clean Fuels following the business combination in this proxy statement is presented for illustrative purposes only and is not necessarily indicative of what our actual financial position or results of operations would have been had the business combination been completed on the dates indicated. See the section entitled “Unaudited Pro Forma Condensed Combined Financial Information” for more information.

We may waive one or more of the conditions to the business combination.

We may agree to waive, in whole or in part, one or more of the conditions to our obligations to complete the business combination, to the extent permitted by our Charter, bylaws and applicable laws. For example, it is a condition to our obligation to close the business combination that certain of Intermediate’s representations and warranties be true and correct to the standards applicable to such representations and warranties. However, if the CENAQ Board determines that it is in the best interests of CENAQ to proceed with the business combination, then the CENAQ Board may elect to waive that condition and close the business combination.

If we are unable to complete an Initial Business Combination on or prior to November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension), our Public Stockholders may receive only approximately $10.10 (or up to $10.30 as applicable) per share on the liquidation of our Trust Account (or less than $10.10 (or $10.30) per share in certain circumstances where a third party brings a claim against us that our Sponsor is unable to indemnify), and our warrants will expire worthless.

If we are unable to complete an Initial Business Combination on or prior to November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension), our Public Stockholders may receive only approximately $10.10 per share on the liquidation of our Trust Account (or less than $10.10 (or $10.30) per share in certain circumstances where a third party brings a claim against us that our Sponsor is unable to indemnify (as described below)), and our warrants will expire worthless.

If third parties bring claims against us, the proceeds held in our Trust Account could be reduced and the per share redemption amount received by stockholders may be less than $10.10 per share.

Our placing of funds in the Trust Account may not protect those funds from third-party claims against us. Although we will seek to have all vendors, service providers (other than our independent public accountants), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the Trust Account for the benefit of our Public Stockholders, such parties may not execute such agreements, or even if they execute such agreements, they may not be prevented from bringing claims against the Trust Account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds held in the Trust Account. Although no third parties have refused to execute an agreement waiving such claims to the monies held in the Trust Account to date, if any third party refuses to execute such an agreement in the future, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party’s engagement would be significantly more beneficial to us than any alternative. Making such a request of potential target businesses may make our acquisition proposal less attractive to them and, to the extent prospective target businesses refuse to execute such a waiver, it may limit the field of potential target businesses that we might pursue.

Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the Trust Account for any reason. Upon redemption of our public shares, if we are unable to complete our business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection with our business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against us within the ten years following redemption. Accordingly, the per-share redemption amount received by Public Stockholders could be less than the $10.10 per public share initially held in the Trust Account, due to claims of such creditors. Our Sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent public accountants) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below the lesser of (a) $10.10 per public share and (b) the actual amount per public share held in the Trust Account, if less than $10.10 per share due to reductions in the value of the trust assets as of the date of the liquidation of the Trust Account, in each case including interest which may be withdrawn to pay taxes as well as expenses relating to the administration of the Trust Account, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the Trust Account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of our IPO against certain liabilities, including liabilities under the Securities Act. However, we have not asked our Sponsor to reserve for such indemnification obligations. Our Sponsor does not have sufficient funds to satisfy its indemnity obligations and our Sponsor’s only assets are securities of our company. Therefore, we cannot assure you that our Sponsor would be able to satisfy those obligations. As a result, if any such claims were successfully made against the Trust Account, the funds available for an Initial Business Combination and redemptions could be reduced to less than $10.10 per public share. In such event, we may not be able to complete an Initial Business Combination, and you would receive such lesser amount per share in connection with any redemption of your public shares. None of our officers will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.

Our directors may decide not to enforce the indemnification obligations of our Sponsor, resulting in a reduction in the amount of funds in the Trust Account available for distribution to our Public Stockholders.

In the event that the proceeds in the Trust Account are reduced below the lesser of (a) $10.10 per public share and (b) the actual amount per public share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.10 per share due to reductions in the value of the trust assets, in each case including interest which may be withdrawn to pay taxes as well as expenses relating to the administration of the Trust Account,

and our Sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against our Sponsor to enforce its indemnification obligations.

While we currently expect that our independent directors would take legal action on our behalf against our Sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment and subject to their fiduciary duties may choose not to do so in any particular instance. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the Trust Account available for distribution to our Public Stockholders may be reduced below $10.10 per share.

We may not have sufficient funds to satisfy indemnification claims of our directors and officers.

We have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors have agreed, and any persons who may become officers or directors prior to an Initial Business Combination will agree, to waive any right, title, interest or claim of any kind in or to any monies in the Trust Account and to not seek recourse against the Trust Account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (a) we have sufficient funds outside of the Trust Account or (b) we consummate an Initial Business Combination. Our obligation to indemnify our officers and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder’s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant to these indemnification provisions.

If, after we distribute the proceeds in the Trust Account to our Public Stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of the CENAQ Board may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of the CENAQ Board and us to claims of punitive damages.

If, after we distribute the proceeds in the Trust Account to our Public Stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. In addition, the CENAQ Board may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying Public Stockholders from the Trust Account prior to addressing the claims of creditors.

If, before distributing the proceeds in the Trust Account to our Public Stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.

If, before distributing the proceeds in the Trust Account to our Public Stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the Trust Account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the Trust Account, the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.

Even if we consummate the business combination, there is no guarantee that the Public Warrants will be in the money at the time they become exercisable, and they may expire worthless.

The exercise price for our warrants is $11.50 per share of Class A Common Stock. There is no guarantee that the Public Warrants will be in the money following the time they become exercisable and prior to their expiration, and as such, the warrants may expire worthless.

We may amend the terms of the warrants in a manner that may be adverse to holders of Public Warrants with the approval by the holders of at least 50% of the then-outstanding Public Warrants. As a result, the exercise price of the warrants could be increased, the exercise period could be shortened and the number of shares of our Class A Common Stock purchasable upon exercise of a warrant could be decreased, all without a holder’s approval.

Our warrants were issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder (i) to cure any ambiguity or to correct any mistake, including to conform the provisions therein to the descriptions of the terms of the warrants, or to cure, correct or supplement any defective provision, or (ii) to add or change any other provisions with respect to matters or questions arising under the warrant agreement as the parties to the warrant agreement may deem necessary or desirable and that the parties deem to not adversely affect the interests of the registered holders of the warrants. The warrant agreement requires the approval by the holders of at least 50% of the then-outstanding Public Warrants to make any change that adversely affects the interests of the registered holders of Public Warrants. Accordingly, we may amend the terms of the Public Warrants in a manner adverse to a holder if holders of at least 50% of the then-outstanding Public Warrants approve of such amendment. Although our ability to amend the terms of the Public Warrants with the consent of at least 50% of the then-outstanding Public Warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, convert the warrants into cash or stock (at a ratio different than initially provided), shorten the exercise period or decrease the number of shares of our Class A Common Stock purchasable upon exercise of a warrant.

We may redeem unexpired warrants prior to their exercise at a time that is disadvantageous to warrantholders, thereby making their warrants worthless.

We have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the reported last sale price of the Class A Common Stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any period of 30 consecutive trading days ending three trading days prior to the date on which we give notice of such redemption and provided certain other conditions are met. Redemption of the outstanding warrants could force warrantholders (i) to exercise their warrants and pay the exercise price therefor at a time when it may be disadvantageous for them to do so, (ii) to sell their warrants at the then-current market price when they might otherwise wish to hold their warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of their warrants. In addition, we may redeem warrants after they become exercisable for a number of shares of Class A Common Stock determined based on the redemption date and the fair market value of our Class A Common Stock. Any such redemption may have similar consequences to a cash redemption described above. In addition, such redemption may occur at a time when the warrants are “out-of-the-money,” in which case warrantholders would lose any potential embedded value from a subsequent increase in the value of the Class A Common Stock had their warrants remained outstanding.

Because certain of our shares of Class A Common Stock and warrants currently trade as units consisting of one share of Class A Common Stock and three-quarters of one warrant, the units may be worth less than units of other blank check companies.

Each unit contains three-quarters of one warrant. Pursuant to the warrant agreement, no fractional warrants will be issued upon separation of the units, and only whole warrants will trade. This is different from other blank check companies similar to ours whose units include one share of common stock and one warrant to purchase one whole share. We have established the components of the units in this way in order to reduce the dilutive effect of the warrants upon completion of an Initial Business Combination since the warrants will be exercisable in the aggregate for three-quarters of the number of shares compared to units that each contain a whole warrant to purchase one share, thus making us, we believe, a more attractive merger partner for target businesses. Nevertheless, this unit structure may cause our units to be worth less than if they included a warrant to purchase one whole share.

We have identified material weaknesses in our internal control over financial reporting. If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results, and we may face litigation as a result.

In connection with the preparation of our financial statements as of September 30, 2021, we reevaluated the classification of the Class A Common Stock subject to possible redemption. This revaluation was due to a recent notification from the SEC that SPAC’s must not report possible redemption of stock as permanent equity. After consultation with the chairman of our audit committee, our management concluded that the previously issued audited balance sheet dated as of August 17, 2021 related to the consummation of our IPO, which should be restated to report all Class A Common Stock subject to possible redemption as temporary equity. As part of such process, we identified a material weakness in our internal control over financial reporting related to the lack of ability to account for complex financial instruments. During the quarter ended December 31, 2021, management identified a material weakness in internal control relating to the over-allotment option. During the quarter ended June 30, 2022, management identified a material weakness for improper recording of accrued liabilities which affected the quarter ended March 31, 2022. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented, or detected and corrected, on a timely basis. Effective internal controls are necessary for us to provide reliable financial reports and prevent fraud, and material weakness could limit our ability to prevent or detect a misstatement of our accounts or disclosures that could result in a material misstatement of our annual or interim financial statements. In such a case, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports in addition to applicable stock exchange listing requirements, investors may lose confidence in our financial reporting, our securities price may decline and we may face litigation as a result. We continue to evaluate steps to remediate the material weaknesses. These remediation measures may be time consuming and costly and there is no assurance that these initiatives will ultimately have the intended effects. However, we cannot assure you that the measures we have taken to date, or any measures we may take in the future, will be sufficient to avoid potential future material weaknesses.

The Nasdaq Capital Market may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions.

We cannot assure you that our securities will continue to be listed on the Nasdaq Capital Market after the business combination. In connection with the business combination, we will be required to demonstrate compliance with the Nasdaq Capital Market’s initial listing requirements, which are more rigorous than the Nasdaq Capital Market’s continued listing requirements, in order to continue to maintain the listing of our securities on the Nasdaq Capital Market. For instance, our stock price would generally be required to be at least $4.00 per share. We cannot assure you that we will be able to meet those initial listing requirements at that time. Our continued eligibility for listing may depend on, among other things, the number of our shares that are redeemed.

If the Nasdaq Capital Market delists our securities from trading on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:

•        potential termination of the Business Combination Agreement if our securities are not listed on another national exchange mutually agreed to by Intermediate;

•        a limited availability of market quotations for our securities;

•        reduced liquidity for our securities;

•        a determination that our Class A Common Stock is a “penny stock” which will require brokers trading in our Class A Common Stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;

•        a limited amount of news and analyst coverage; and

•        a decreased ability to issue additional securities or obtain additional financing in the future.

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because our units, Class A Common Stock and Public Warrants are listed on the Nasdaq Capital Market, our units, Class A Common Stock and Public Warrants qualify as covered securities. Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the sale of securities issued by blank check companies, other than the state of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if we were no longer listed on the Nasdaq Capital Market, our securities would not be covered securities and we would be subject to regulation in each state in which we offer our securities.

The CENAQ Board did not obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the business combination.

The CENAQ Board did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the business combination. CENAQ’s officers and directors have substantial experience in evaluating the operating and financial merits of companies from a wide range of industries and concluded that their experience and backgrounds, together with the experience and sector expertise of CENAQ’s advisors, enabled them to make the necessary analyses and determinations regarding the business combination. Accordingly, investors will be relying solely on the judgment of the CENAQ Board in valuing Intermediate and assuming the risk that the CENAQ Board may not have properly valued the business. The lack of a third-party valuation or fairness opinion may also lead an increased number of stockholders to vote against the proposed business combination or demand redemption of their shares for cash, which could potentially impact CENAQ’s ability to consummate the business combination.

We cannot assure you that our diligence review has identified all material risks associated with the business combination, and you may be less protected as an investor from any material issues with respect to Intermediate’s business, including any material omissions or misstatements contained in this proxy statement relating to the business combination than an investor in an initial public offering.

Before entering into the Business Combination Agreement, we performed a due diligence review of Intermediate and its business and operations; however, we cannot assure you that our due diligence review identified all material issues, and certain unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Additionally, the scope of due diligence we have conducted in conjunction with the business combination may be different than would typically be conducted in the event Intermediate pursued an underwritten initial public offering. In a typical initial public offering, the underwriters of the offering conduct due diligence on the company to be taken public, and following the offering, the underwriters are subject to liability to private investors for any material misstatements or omissions in the registration statement. While potential investors in an initial public offering typically have a private right of action against the underwriters of the offering for any of these material misstatements or omissions, there are no underwriters pursuant to this proxy statement and thus no corresponding right of action is available to investors in the business combination for any material misstatements or omissions in this proxy statement. Therefore, as an investor, you may be exposed to future losses, impairment charges, write-downs, write-offs or other charges that could have a significant negative effect on Intermediate’s financial condition, results of operations and the price of its securities, which could cause you to lose some or all of your investment without recourse against an underwriter that may have been available had Intermediate been taken public through an underwritten public offering.

A significant portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future. This could cause the market price of our Class A Common Stock to drop significantly, even if our business is doing well.

Sales of a substantial number of shares of Class A Common Stock in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our Class A Common Stock. After the business combination (and assuming no redemptions by our Public Stockholders of public shares, no exercise of the Public and Private Placement

Warrants, and no vesting of the Equity Earn Out), our Sponsor, officers and directors and their affiliates and the Anchor Investors will hold approximately 8.61% of our common stock, including the 4,312,500 shares of Class A Common Stock into which the Founder Shares will be converted. Assuming a maximum redemption by our Public Stockholders of 17,250,000 of the public shares, our Sponsor, officers and directors and their affiliates and the Anchor Investors will hold approximately 12.39% of our common stock including the 4,312,500 shares of Class A Common Stock into which the Founder Shares will be converted (assuming no redemptions by our Public Stockholders of public shares, no exercise of the Public Warrants and Private Placement Warrants, and no vesting of the Equity Earn Out). Pursuant to the terms of a letter agreement entered into at the time of the IPO, the Founder Shares (which will be converted into shares of Class A Common Stock at the Closing) may not be transferred until the earlier to occur of (a) six months after the after the Closing or (b) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the last sale price of our Class A Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any period of 30 consecutive trading days commencing at least 75 days after the Closing, the shares of Class A Common Stock into which the Founder Shares have been or will be converted will be released from these transfer restrictions. In connection with the Closing, the IPO Registration Rights Agreement will be amended and restated and Verde Clean Fuels and the Reg Rights Holders will enter into the A&R Registration Rights Agreement. Pursuant to the A&R Registration Rights Agreement, Verde Clean Fuels will agree that, within 30 days after the Closing, Verde Clean Fuels will file the Resale Registration Statement with the SEC (at Verde Clean Fuels’ sole cost and expense), and Verde Clean Fuels will use its commercially reasonable efforts to have the Resale Registration Statement declared effective as soon as reasonably practicable after the filing thereof. In certain circumstances, the Reg Rights Holders can demand Verde Clean Fuels’ assistance with underwritten offerings and block trades, and the Reg Rights Holders will be entitled to certain piggyback registration rights. Further, under the Subscription Agreements, CENAQ agreed that, within 30 calendar days after the Closing Date, Verde Clean Fuels will file with the SEC (at Verde Clean Fuels’ sole cost and expense) the PIPE Resale Registration Statement, and Verde Clean Fuels will use its commercially reasonable efforts to have the PIPE Resale Registration Statement declared effective as soon as practicable after the filing thereof.

For more information about the A&R Registration Rights Agreement and Subscription Agreements, see the section entitled “Proposal No. 1 — The Business Combination Proposal — Related Documents — A&R Registration Rights Agreement” and the section entitled “Proposal No. 1 — The Business Combination Proposal — Related Documents — PIPE Financing.”

The market price of Class A Common Stock could be adversely affected by sales of substantial amounts of Class A Common Stock in the public or private markets or the perception in the public markets that these sales may occur, including sales by Holdings after the redemption of any Holdings OpCo Units, together with an equal number of Holdings Class C Shares, in exchange for shares of Class A Common Stock, or other large holders.

After the business combination, assuming no redemptions by CENAQ Public Stockholders of public shares, no exercise of the Public Warrants and Private Placement Warrants, and no vesting of the Equity Earn Out, Verde Clean Fuels will have 27,562,500 shares of Class A Common Stock and 22,500,000 shares of Class C Common Stock outstanding. Verde Clean Fuels has agreed to provide registration rights to Holdings pursuant to the A&R Registration Rights Agreement. Sales of shares of Class A Common Stock by Holdings after the redemption of any Holdings OpCo Units, together with the cancellation of an equal number of Holdings Class C Shares, for shares of Class A Common Stock, or by other large holders of a substantial number of shares of Class A Common Stock in the public markets following the business combination, or the perception that such sales might occur, could have a material adverse effect on the price of the Class A Common Stock or could impair Verde Clean Fuels’ ability to obtain capital through an offering of equity securities in the future.

CENAQ cannot predict the size of any redemption of Holdings OpCo Units or other future issuances of Class A Common Stock or securities convertible into Class A Common Stock or the effect, if any, that future issuances or sales of shares of Class A Common Stock will have on the market price of Class A Common Stock. Sales of substantial amounts of Class A Common Stock, or the perception that such sales could occur, may adversely affect prevailing market prices of Class A Common Stock.

If the business combination’s benefits do not meet the expectations of investors, stockholders or financial analysts, the market price of our securities may decline.

If the benefits of the business combination do not meet the expectations of investors or securities analysts, the market price of our securities prior to the Closing may decline. The market values of our securities at the time of the business combination may vary significantly from their prices on the date the Business Combination Agreement was executed, the date of this proxy statement or the date on which our stockholders vote on the business combination.

In addition, following the business combination, fluctuations in the price of our securities could contribute to the loss of all or part of your investment. Prior to the business combination, trading in the shares of our Class A Common Stock has not been active. Accordingly, the valuation ascribed to our Class A Common Stock in the business combination may not be indicative of the price that will prevail in the trading market following the business combination. If an active market for our securities develops and continues, the trading price of our securities following the business combination could be volatile and subject to wide fluctuations in response to various factors, some of which are beyond our control. Any of the factors listed below could have a material adverse effect on your investment in our securities and our securities may trade at prices significantly below the price you paid for them. In such circumstances, the trading price of our securities may not recover and may experience a further decline.

Factors affecting the trading price of our securities following the business combination may include:

•        actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us;

•        changes in the market’s expectations about our operating results;

•        success of competitors;

•        our operating results failing to meet the expectation of securities analysts or investors in a particular period;

•        changes in financial estimates and recommendations by securities analysts concerning Verde Clean Fuels or the market in general;

•        operating and stock price performance of other companies that investors deem comparable to us;

•        our ability to market new and enhanced products and technologies on a timely basis;

•        changes in laws and regulations affecting our business;

•        our ability to meet compliance requirements;

•        commencement of, or involvement in, litigation involving Verde Clean Fuels;

•        changes in our capital structure, such as future issuances of securities or the incurrence of additional debt;

•        the volume of shares of our common stock available for public sale;

•        any major change in the CENAQ Board or management;

•        sales of substantial amounts of common stock by our directors, executive officers or significant stockholders or the perception that such sales could occur;

•        sales of shares of our Class A Common Stock by the New PIPE Investors;

•        the volume of shares of our Class A Common Stock available for public sale, including as a result of the termination of the post-closing lock-up pursuant to the terms thereof; and

•        general economic and political conditions such as recessions, interest rates, fuel prices, international currency fluctuations and acts of war or terrorism.

Broad market and industry factors may materially harm the market price of our securities irrespective of our operating performance. The stock market in general and the Nasdaq Stock Market have experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our securities, may not be predictable. A loss of investor confidence in the market for retail stocks or the stocks of other companies which investors perceive to be similar to Verde Clean Fuels following the business combination could depress our stock price regardless of our business, prospects, financial condition or results of operations. A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.

Following the business combination, if securities or industry analysts do not publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our common stock adversely, the price and trading volume of our common stock could decline.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts may publish about us, our business, our market or our competitors. If any of the analysts who may cover Verde Clean Fuels following the business combination change their recommendation regarding our stock adversely, or provide more favorable relative recommendations about our competitors, the price of our common stock would likely decline. If any analyst who may cover Verde Clean Fuels following the business combination were to cease their coverage or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our stock price or trading volume to decline.

Our Sponsor, directors, officers, advisors or any of their respective affiliates may elect to purchase public shares from Public Stockholders, which may influence the vote on the Business Combination Proposal and reduce the public “float” of our Class A Common Stock.

Our Sponsor, directors, officers, advisors or any of their respective affiliates may purchase public shares in privately negotiated transactions or in the open market either prior to or following the completion of the business combination, although they are under no obligation to do so. There is no limit on the number of public shares our Sponsor, directors, officers, advisors or any of their respective affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. Any such privately negotiated purchases may be effected at purchase prices that are no higher than the per share pro rata portion of the Trust Account. However, our Sponsor, directors, officers, advisors and their respective affiliates have not consummated any such purchases or acquisitions, have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the Trust Account will be used to purchase public shares in such transactions. None of our Sponsor, directors, officers, advisors or any of their respective affiliates will make any such purchases when they are in possession of any material non-public information not disclosed to the seller of such public shares or during a restricted period under Regulation M under the Exchange Act. Such a purchase could include a contractual acknowledgement that such stockholder, although still the record holder of such public shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its Redemption Rights. Any public shares purchased by our Sponsor or its affiliates would not be voted in favor of approving the business combination.

In the event that our Sponsor, directors, officers, advisors or any of their respective affiliates purchase public shares in privately negotiated transactions from Public Stockholders who have already elected to exercise their Redemption Rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. In addition, our Sponsor and its affiliates would waive any Redemption Rights with respect to any public shares that they purchase in any such privately negotiated transactions.

The purpose of any such purchases of public shares could be to increase the likelihood of obtaining stockholder approval of the business combination or to satisfy a closing condition in the Business Combination Agreement, where it appears that such requirement would otherwise not be met. Any such purchases of our public shares may result in the completion of the business combination that may not otherwise have been possible. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent the

purchasers are subject to such reporting requirements. In addition, to the extent that our Sponsor or its affiliates purchase any public shares as contemplated above, we will file a Current Report on Form 8-K prior to the special meeting that will disclose:

•        the amount of such public shares purchased by our Sponsor or its affiliates, along with the purchase price;

•        the purpose of the purchases by our Sponsor or its affiliates;

•        the impact, if any, of the purchases by our Sponsor or its affiliates on the likelihood that the business combination will be approved;

•        the identities of our security holders who sold to our Sponsor or its affiliates (if not purchased on the open market) or the nature of our security holders (e.g., 5% security holders) who sold to our Sponsor or its affiliates; and

•        the number of public shares for which we have received redemption requests in connection with the business combination.

In addition, if such purchases are made, the public “float” of our Class A Common Stock may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. See the section entitled “Proposal No. 1 — The Business Combination Proposal — Potential Purchases of Public Shares” for a description of how our Sponsor, directors, officers, advisors or any of their respective affiliates will select which stockholders or warrantholders to purchase securities from in any private transaction.

We may be subject to legal proceedings in connection with the business combination, the outcomes of which would be uncertain, and may delay or prevent the completion of the business combination and adversely affect Verde Clean Fuels’ business, financial condition and results of operations.

CENAQ may in the future receive demand letters or complaints from purported stockholders of CENAQ regarding certain actions taken in connection with the business combination and the adequacy of this proxy statement. These demand letters or complaints may lead to litigation against CENAQ or its directors and officers in connection with the business combination. Defending against any lawsuits could require CENAQ to incur significant costs and draw the attention of CENAQ’s management away from the business combination. Further, the defense or settlement of any lawsuit or claim that remains unresolved at the Closing may adversely affect Verde Clean Fuels’ business, financial condition and results of operations. Such legal proceedings could also delay or prevent the Closing from occurring within the contemplated timeframe.

Changes in laws or regulations, or a failure to comply with any laws or regulations, may adversely affect our business, investments and results of operations.

We are subject to laws and regulations enacted by national, regional and local governments. In particular, we are required to comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to negotiate and complete the business combination, and results of operations.

On March 30, 2022, the SEC issued proposed rules relating to, among other items, enhancing disclosures in business combination transactions involving SPACs and private operating companies; amending the financial statement requirements applicable to transactions involving shell companies; effectively limiting the use of projections in SEC filings in connection with proposed business combination transactions; increasing the potential liability of certain participants in proposed business combination transactions; and the extent to which SPACs could

become subject to regulation under the Investment Company Act of 1940. These rules, if adopted, whether in the form proposed or in revised form, may materially adversely affect our ability to negotiate and complete our Initial Business Combination and may increase the costs and time related thereto.

As a result of plans to expand Verde Clean Fuels’ business operations, including to jurisdictions in which tax laws may not be favorable, its obligations may change or fluctuate, become significantly more complex or become subject to greater risk of examination by taxing authorities, any of which could adversely affect Verde Clean Fuels’ after-tax profitability and financial results.

Our effective tax rates may fluctuate widely in the future, particularly if Verde Clean Fuels’ business expands domestically or internationally. Future effective tax rates could be affected by operating losses in jurisdictions where no tax benefit can be recorded under GAAP, changes in deferred tax assets and liabilities, or changes in tax laws. Factors that could materially affect our future effective tax rates include, but are not limited to: (a) changes in tax laws or the regulatory environment, (b) changes in accounting and tax standards or practices, (c) changes in the composition of operating income by tax jurisdiction and (d) pre-tax operating results of Verde Clean Fuels’ business.

Additionally, after the business combination, Verde Clean Fuels may be subject to significant income, withholding, and other tax obligations in the United States and may become subject to taxation in numerous additional U.S. state and local and non-U.S. jurisdictions with respect to income, operations and subsidiaries related to those jurisdictions. Verde Clean Fuels’ after-tax profitability and financial results could be subject to volatility or be affected by numerous factors, including (a) the availability of tax deductions, credits, exemptions, refunds and other benefits to reduce tax liabilities, (b) changes in the valuation of deferred tax assets and liabilities, if any, (c) the expected timing and amount of the release of any tax valuation allowances, (d) the tax treatment of stock-based compensation, (e) changes in the relative amount of earnings subject to tax in the various jurisdictions, (f) the potential business expansion into, or otherwise becoming subject to tax in, additional jurisdictions, (g) changes to existing intercompany structure (and any costs related thereto) and business operations, (h) the extent of intercompany transactions and the extent to which taxing authorities in relevant jurisdictions respect those intercompany transactions and (i) the ability to structure business operations in an efficient and competitive manner. Outcomes from audits or examinations by taxing authorities could have an adverse effect on Verde Clean Fuels’ after-tax profitability and financial condition. Additionally, the U.S. Internal Revenue Service (“IRS”) and several foreign tax authorities have increasingly focused attention on intercompany transfer pricing with respect to sales of products and services and the use of intangibles. Tax authorities could disagree with Verde Clean Fuels’ intercompany charges, cross-jurisdictional transfer pricing or other matters and assess additional taxes. If Verde Clean Fuels does not prevail in any such disagreements, Verde Clean Fuels’ profitability may be affected.

Verde Clean Fuels’ after-tax profitability and financial results may also be adversely affected by changes in relevant tax laws and tax rates, treaties, regulations, administrative practices and principles, judicial decisions and interpretations thereof, in each case, possibly with retroactive effect.

Our warrants and Founder Shares may have an adverse effect on the market price of our Class A Common Stock and make it more difficult to effectuate our business combination.

We issued warrants to purchase 12,937,500 shares of Class A Common Stock as part of the units. We also issued 6,675,000 Private Placement Warrants, each exercisable to purchase one share of Class A Common Stock at $11.50 per share.

Our Sponsor and the Anchor Investors currently own an aggregate of 4,312,500 Founder Shares. Any issuance of a substantial number of additional shares of Class A Common Stock upon exercise of these warrants and conversion rights will increase the number of issued and outstanding shares of Class A Common Stock and reduce the value of the Class A Common Stock issued to complete the business combination. Therefore, our warrants and Founder Shares may make it more difficult to effectuate the business combination or increase the cost of acquiring Intermediate.

We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete the business combination even if a substantial majority of our stockholders do not agree.

Our Charter does not provide a specified maximum redemption threshold. Our Charter provides we will not redeem our Class A Common Stock in an amount that would cause our net tangible assets to be less than $5,000,001 upon completion of our Initial Business Combination (so that we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our Initial Business Combination. However, our Charter will be amended and restated immediately prior to the business combination, such that such limitation will no longer apply, and we anticipate our Class A Common Stock will be listed on the Nasdaq Capital Market, which provides a separate exception from being subject to the “penny stock” rules. As a result, we may be able to complete the business combination even though a substantial majority of our Public Stockholders do not agree with the transaction and have redeemed their shares or have entered into privately negotiated agreements to sell their shares to our Sponsor, officers, directors, advisors or any of their respective affiliates. In the event the aggregate cash consideration we would be required to pay for all shares of Class A Common Stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, all shares of Class A Common Stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination.

Verde Clean Fuels is a holding company. Verde Clean Fuels’ only material asset after the business combination will be its equity interest in OpCo, and Verde Clean Fuels will accordingly be dependent upon distributions from OpCo to pay taxes, make payments under the Tax Receivable Agreement and cover its corporate and other overhead expenses.

Verde Clean Fuels is a holding company and will have no material assets after completion of the business combination other than its equity interest in OpCo. Verde Clean Fuels will have no independent means of generating revenue. To the extent OpCo has available cash, we intend to cause OpCo to make (i) generally pro rata distributions to the holders of OpCo Units, including Verde Clean Fuels, in an amount at least sufficient to allow Verde Clean Fuels to pay its taxes and make payments under the Tax Receivable Agreement and any subsequent tax receivable agreement that it may enter into in connection with future acquisitions and (ii) non-pro rata payments to Verde Clean Fuels to reimburse it for its corporate and other overhead expenses. To the extent that Verde Clean Fuels needs funds and OpCo or its subsidiaries are restricted from making such distributions or payments under applicable law or regulation or under the terms of any current or future financing arrangements, or are otherwise unable to provide such funds, our liquidity and financial condition could be materially adversely affected.

Moreover, because Verde Clean Fuels will have no independent means of generating revenue, Verde Clean Fuels’ ability to make tax payments and payments under the Tax Receivable Agreement will be dependent on the ability of OpCo to make distributions to Verde Clean Fuels in an amount sufficient to cover Verde Clean Fuels’ tax obligations (and those of its wholly owned subsidiaries) and obligations under the Tax Receivable Agreement. This ability, in turn, may depend on the ability of OpCo’s subsidiaries to make distributions to it. We intend that such distributions from OpCo and its subsidiaries be funded with cash from operations or from future borrowings. The ability of OpCo, its subsidiaries and other entities in which it directly or indirectly holds an equity interest to make such distributions will be subject to, among other things, (i) the applicable provisions of Delaware law (or other applicable jurisdiction) that may limit the amount of funds available for distribution and (ii) restrictions in relevant debt instruments issued by OpCo or its subsidiaries and other entities in which it directly or indirectly holds an equity interest. To the extent that Verde Clean Fuels is unable to make payments under the Tax Receivable Agreement for any reason, such payments will be deferred and will accrue interest until paid.

Verde Clean Fuels will be required to make payments under the Tax Receivable Agreement for certain tax benefits that it may claim, and the amounts of such payments could be significant.

In connection with the business combination, Verde Clean Fuels will enter into the Tax Receivable Agreement with the TRA Holders. This agreement will generally provide for the payment by Verde Clean Fuels to the TRA Holders of 85% of the net cash savings, if any, in U.S. federal, state and local income tax and franchise tax (computed using simplifying assumptions to address the impact of state and local taxes) that Verde Clean Fuels

actually realizes (or is deemed to realize in certain circumstances) in periods after the business combination as a result of certain increases in tax basis available to Verde Clean Fuels pursuant to the exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right and certain benefits attributable to imputed interest. We will retain the benefit of the remaining 15% of any actual net cash tax savings.

The term of the Tax Receivable Agreement will commence upon the Closing and will continue until all tax benefits that are subject to the Tax Receivable Agreement have been utilized or expired, unless we experience a change of control (as defined in the Tax Receivable Agreement, which includes certain mergers, asset sales, or other forms of business combinations) or the Tax Receivable Agreement otherwise terminates early (at our election or as a result of our breach or the commencement of bankruptcy or similar proceedings by or against us), and Verde Clean Fuels makes the termination payments specified in the Tax Receivable Agreement in connection with such change of control or other early termination.

The payment obligations under the Tax Receivable Agreement are Verde Clean Fuels’ obligations and not obligations of OpCo, and we expect that the payments required to be made under the Tax Receivable Agreement will be substantial. Estimating the amount and timing of payments that may become due under the Tax Receivable Agreement is by its nature imprecise. For purposes of the Tax Receivable Agreement, net cash tax savings generally are calculated by comparing Verde Clean Fuels’ actual tax liability (determined by using the actual applicable U.S. federal income tax rate and an assumed combined state and local income and franchise tax rate) to the amount Verde Clean Fuels would have been required to pay had it not been able to utilize any of the tax benefits subject to the Tax Receivable Agreement. The actual increases in tax basis covered by the Tax Receivable Agreement, as well as the amount and timing of any payments under the Tax Receivable Agreement, will vary depending on a number of factors, including the timing of any redemption of Class C OpCo Units, the price of Verde Clean Fuels’ Class A Common Stock at the time of each redemption, the extent to which such redemptions are taxable transactions, the amount of the redeeming OpCo unitholder’s tax basis in its Class C OpCo Units at the time of the relevant redemption, the depreciation and amortization periods that apply to the increase in tax basis, the amount and timing of taxable income we generate in the future, the U.S. federal income tax rates then applicable, and the portion of Verde Clean Fuels’ payments under the Tax Receivable Agreement that constitute imputed interest or give rise to depreciable or amortizable tax basis. The Tax Receivable Agreement contains a payment cap of $50,000,000, which applies only to certain payments required to be made in connection with the occurrence of a change of control. The Payment Cap would not be reduced or offset by any amounts previously paid under the Tax Receivable Agreement or any amounts that are required to be paid (but have not yet been paid) for the year in which the change of control occurs or any prior years. Any distributions made by OpCo to Verde Clean Fuels in order to enable Verde Clean Fuels to make payments under the Tax Receivable Agreement, as well as any corresponding pro rata distributions made to the OpCo unitholders, could have an adverse impact on our liquidity.

The payments under the Tax Receivable Agreement will not be conditioned upon a TRA Holder having a continued ownership interest in Verde Clean Fuels or OpCo. For additional information regarding the Tax Receivable Agreement, see “Proposal No. 1 — The Business Combination Proposal — Related Documents — Tax Receivable Agreement.”

In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual benefits, if any, Verde Clean Fuels realizes in respect of the tax attributes subject to the Tax Receivable Agreement.

If we experience a change of control (as defined under the Tax Receivable Agreement, which includes certain mergers, asset sales and other forms of business combinations) or the Tax Receivable Agreement otherwise terminates early (at our election or as a result of our breach or the commencement of bankruptcy or similar proceedings by or against us), Verde Clean Fuels’ obligations under the Tax Receivable Agreement would accelerate and Verde Clean Fuels would be required to make an immediate payment equal to the present value of the anticipated future payments to be made by it under the Tax Receivable Agreement and such payment is expected to be substantial. The calculation of anticipated future payments would be based upon certain assumptions and deemed events set forth in the Tax Receivable Agreement, including (i) that Verde Clean Fuels has sufficient taxable income to fully utilize the tax benefits covered by the Tax Receivable Agreement, and (ii) that any OpCo Units (other than those held by Verde Clean Fuels) outstanding on the termination date are deemed to be redeemed on the termination date. If we were to experience a change of control or the Tax Receivable Agreement was otherwise terminated

immediately after the Closing, we estimate that the early termination payment, calculated on the basis of the above assumptions, would be approximately $             (calculated using a discount rate equal to (i) the greater of (A) 0.25% and (B) the Secured Overnight Financing Rate (“SOFR”), plus (ii) 150 basis points, applied against an undiscounted liability of $             based on the 21% U.S. federal corporate income tax rate and estimated applicable state and local income tax rates). The foregoing amount is merely an estimate and the actual payment could differ materially. In connection with a change of control, any early termination payment would be subject to the Payment Cap of $50,000,000. The Payment Cap would not be reduced or offset by any amounts previously paid under the Tax Receivable Agreement or any amounts that are required to be paid (but have not yet been paid) for the year in which the change of control occurs or any prior years.

Any early termination payment may be made significantly in advance of, and may materially exceed, the actual realization, if any, of the future tax benefits to which the termination payment relates. Moreover, the obligation to make an early termination payment upon a change of control could have a substantial negative impact on our liquidity and could have the effect of delaying, deferring or preventing certain mergers, asset sales, or other forms of business combinations or changes of control.

There can be no assurance that we will be able to satisfy our obligations under the Tax Receivable Agreement. Please read “Proposal No. 1 — The Business Combination Proposal — Related Documents — Tax Receivable Agreement.”

In the event that payment obligations under the Tax Receivable Agreement are accelerated in connection with certain mergers, other forms of business combinations or other changes of control, the consideration payable to holders of our Class A Common Stock could be substantially reduced.

If we experience a change of control (as defined under the Tax Receivable Agreement, which includes certain mergers, asset sales and other forms of business combinations), Verde Clean Fuels would be obligated to make a substantial immediate lump-sum payment, and such payment may be significantly in advance of, and may materially exceed, the actual realization, if any, of the future tax benefits to which the payment relates; provided that any such payment would be subject to the Payment Cap of $50,000,000, which applies only to certain payments required to be made under the Tax Receivable Agreement in connection with the occurrence of a change of control. The Payment Cap would not be reduced or offset by any amounts previously paid under the Tax Receivable Agreement or any amounts that are required to be paid (but have not yet been paid) for the year in which the change of control occurs or any prior years. As a result of this payment obligation, holders of our Class A Common Stock could receive substantially less consideration in connection with a change of control transaction than they would receive in the absence of such obligation. Further, any payment obligations under the Tax Receivable Agreement will not be conditioned upon the TRA Holders’ having a continued interest in Verde Clean Fuels or OpCo. Accordingly, the TRA Holders’ interests may conflict with those of the holders of our Class A Common Stock. Please read “Risk Factors — Risks Related to Verde Clean Fuels and the Business Combination — In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual benefits, if any, Verde Clean Fuels realizes in respect of the tax attributes subject to the Tax Receivable Agreement” and “Proposal No. 1 — The Business Combination Proposal — Related Documents — Tax Receivable Agreement.”

We will not be reimbursed for any payments made under the Tax Receivable Agreement in the event that any tax benefits are subsequently disallowed.

Payments under the Tax Receivable Agreement will be based on the tax reporting positions that we will determine. The IRS or another taxing authority may challenge all or part of the tax basis increases covered by the Tax Receivable Agreement, as well as other related tax positions we take, and a court could sustain such challenge. The TRA Holders will not reimburse us for any payments previously made under the Tax Receivable Agreement if any tax benefits that have given rise to payments under the Tax Receivable Agreement are subsequently disallowed, except that excess payments made to any TRA Holder will be netted against future payments that would otherwise be made to such TRA Holder, if any, after our determination of such excess (which determination may be made a number of years following the initial payment and after future payments have been made). As a result, in such circumstances, we could make payments that are greater than Verde Clean Fuels’ actual cash tax savings, if any, and we may not be able to recoup those payments, which could materially adversely affect our liquidity.

If OpCo were to become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes, Verde Clean Fuels and OpCo might be subject to potentially significant tax inefficiencies, and we would not be able to recover payments previously made by Verde Clean Fuels under the Tax Receivable Agreement even if the corresponding tax benefits were subsequently determined to have been unavailable due to such status.

We intend to operate such that OpCo does not become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes. A “publicly traded partnership” is a partnership the interests of which are traded on an established securities market or are readily tradable on a secondary market or the substantial equivalent thereof. Under certain circumstances, the exchange of Class C OpCo Units pursuant to the OpCo Exchange Right or Mandatory Exchange (or acquisitions of Class C OpCo Units pursuant to the Call Right) or other transfers of Class C OpCo Units could cause OpCo to be treated as a publicly traded partnership. Applicable U.S. Treasury regulations provide for certain safe harbors from treatment as a publicly traded partnership, and we intend to operate such that redemptions or other transfers of OpCo Units qualify for one or more of such safe harbors. For example, we intend to limit the number of holders of OpCo Units, and the OpCo A&R LLC Agreement, which will be entered into in connection with the Closing, will provide for certain limitations on the ability of holders of OpCo Units to transfer their OpCo Units and will provide Verde Clean Fuels, as the manager of OpCo, with the right to prohibit the exercise of an OpCo Exchange Right if it determines (based on the advice of counsel) there is a material risk that OpCo would be a publicly traded partnership as a result of such exercise.

If OpCo were to become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes, significant tax inefficiencies might result for Verde Clean Fuels and for OpCo, including as a result of Verde Clean Fuels’ inability to file a consolidated U.S. federal income tax return with OpCo. In addition, Verde Clean Fuels might not be able to realize tax benefits covered under the Tax Receivable Agreement, and we would not be able to recover any payments previously made by Verde Clean Fuels under the Tax Receivable Agreement, even if the corresponding tax benefits (including any claimed increase in the tax basis of OpCo’s assets) were subsequently determined to have been unavailable.

In certain circumstances, OpCo will be required to make tax distributions to the OpCo unitholders, including Verde Clean Fuels, and the tax distributions that OpCo will be required to make may be substantial. The OpCo tax distribution requirement may complicate our ability to maintain our intended capital structure.

OpCo will generally make quarterly tax distributions to the OpCo unitholders, including Verde Clean Fuels. Such distributions will be pro rata and be in an amount sufficient to cause each OpCo unitholder to receive a distribution at least equal to (i) such OpCo unitholder’s allocable share of net taxable income (in the case of each OpCo unitholder other than Verde Clean Fuels, taking into account prior normal operating pro rata distributions made to such OpCo unitholders in such year and calculated under certain assumptions), and (ii) with respect to Verde Clean Fuels, any payments required to be made by Verde Clean Fuels under the Tax Receivable Agreement or any similar subsequent tax receivable agreements that it may enter into in connection with future acquisitions (in each case, calculated under certain assumptions) multiplied by an assumed tax rate. The assumed tax rate for this purpose will be the combined maximum U.S. federal, state, and local rate of tax applicable to Verde Clean Fuels for the applicable taxable year unless otherwise determined by OpCo. As a result of certain assumptions in calculating the tax distribution payments, Verde Clean Fuels may receive tax distributions from OpCo in excess of its actual tax liability and its obligations under the Tax Receivable Agreement.

The receipt of such excess distributions would complicate our ability to maintain certain aspects of our capital structure. Such cash, if retained, could cause the value of a Class A OpCo Unit to deviate from the value of a share of Class A Common Stock, contrary to the one-to-one relationship described in the section titled “Proposal No. 1 — The Business Combination Proposal — Related Agreements — OpCo LLC Agreement.” If Verde Clean Fuels retains such cash balances, the holders of Class C OpCo Units would benefit from any value attributable to such accumulated cash balances as a result of their exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right. We intend to cause Verde Clean Fuels to take steps to eliminate any material cash balances. Such steps could include distributing such cash balances as dividends on our Class A Common Stock and reinvesting such cash balances in OpCo for additional Class A OpCo Units (with an accompanying stock dividend with respect to our Class A Common Stock or an adjustment to the one-to-one exchange ratio applicable to the exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right).

The tax distributions to the OpCo unitholders may be substantial and may, in the aggregate, exceed the amount of taxes that OpCo would have paid if it were a similarly situated corporate taxpayer. Funds used by OpCo to satisfy its tax distribution obligations will generally not be available for reinvestment in its business.

Risks Related to the Redemption

CENAQ cannot be certain as to the number of shares of public stock that will be redeemed and the potential impact to Public Stockholders who do not elect to redeem their public stock.

There is no guarantee that a stockholder’s decision whether to redeem its shares for a pro rata portion of the Trust Account will put the stockholder in a better future economic position. We can give no assurance as to the price at which a stockholder may be able to sell its public shares in the future following the completion of the business combination or any alternative business combination. Redemptions of public shares and certain events following the consummation of the business combination may cause an increase or decrease in our stock price, and may result in a lower value realized now than a stockholder of CENAQ might realize in the future had the stockholder not redeemed its shares. Similarly, if a stockholder does not redeem its shares, the stockholder will bear the risk of ownership of the public shares after the consummation of the business combination, and there can be no assurance that a stockholder can sell its shares in the future for a greater amount than the redemption price set forth in this proxy statement. A stockholder should consult, and rely solely upon, the stockholder’s own tax and/or financial advisor for assistance on how this may affect his, her or its individual situation.

On             , 2022, the most recent practicable date prior to the date of this proxy statement, the closing price per share of the Class A Common Stock was $            . Public Stockholders should be aware that, while we are unable to predict the price per share of the Class A Common Stock following the consummation of the business combination — and accordingly we are unable to predict the potential impact of redemptions on the per share value of public shares owned by non-redeeming stockholders — increased levels of redemptions by Public Stockholders may be a result of the price per share of the Class A Common Stock falling below the redemption price. We expect that more Public Stockholders may elect to redeem their public shares if the share price of the Class A Common Stock is below the projected redemption price of $10.10 per share, and we expect that more Public Stockholders may elect not to redeem their public shares if the share price of the Class A Common Stock is above the projected redemption price of $10.10 per share. Each public share that is redeemed will represent both (i) a reduction, equal to the amount of the redemption price, of the cash that will be available to CENAQ from the Trust Account and (ii) a corresponding increase in each public stockholder’s pro rata ownership interest in Verde Clean Fuels following the consummation of the business combination.

If our stockholders fail to comply with the redemption requirements specified in this proxy statement, they will not be entitled to redeem their shares of Class A Common Stock for a pro rata portion of the funds held in the Trust Account.

In order to exercise their Redemption Rights, holders of public shares are required to submit a request in writing and deliver their shares (either physically or electronically) to our transfer agent at least two business days prior to the special meeting. Stockholders electing to redeem their shares will receive their pro rata portion of the Trust Account, including interest not previously released to us to pay our franchise and income taxes as well as expenses relating to the administration of the Trust Account, calculated as of two business days prior to the anticipated consummation of the business combination. See the section entitled “Special Meeting of CENAQ Stockholders — Redemption Rights” for additional information on how to exercise your Redemption Rights.

Stockholders who wish to redeem their shares for a pro rata portion of the Trust Account must comply with specific requirements for redemption that may make it more difficult for them to exercise their Redemption Rights prior to the deadline.

Public Stockholders who wish to redeem their shares for a pro rata portion of the Trust Account must, among other things, as more fully described in the section entitled “Special Meeting of CENAQ Stockholders — Redemption Rights,” tender their certificates to our transfer agent or deliver their shares to the transfer agent electronically through DTC prior to 5:00 p.m., Eastern time, on            , 2022. In order to obtain a physical stock certificate, a stockholder’s broker and/or clearing broker, DTC and our transfer agent will need to act to facilitate this request. It is our understanding that stockholders should generally allot at least two weeks to obtain physical certificates from

the transfer agent. However, because we do not have any control over this process or over the brokers, it may take significantly longer than two weeks to obtain a physical stock certificate. If it takes longer than anticipated to obtain a physical certificate, stockholders who wish to redeem their shares may be unable to obtain physical certificates by the deadline for exercising their Redemption Rights and thus will be unable to redeem their shares.

In addition, holders of outstanding units of CENAQ must separate the underlying public shares and Public Warrants prior to exercising Redemption Rights with respect to the public shares. If you hold units registered in your own name, you must deliver the certificate for such units or deliver such units electronically to Continental Stock Transfer & Trust Company with written instructions to separate such units into public shares and Public Warrants. This must be completed far enough in advance to permit the mailing of the public share certificates or electronic delivery of the public shares back to you so that you may then exercise your Redemption Rights with respect to the public shares following the separation of such public shares from the units.

If a broker, dealer, commercial bank, trust company or other nominee holds your units, you must instruct such nominee to separate your units. Your nominee must send written instructions by facsimile to Continental Stock Transfer & Trust Company. 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 DTC’s DWAC system, a withdrawal of the relevant units and a deposit of the corresponding number of public shares and Public Warrants. This must be completed far enough in advance to permit your nominee to exercise your Redemption Rights with respect to the public shares following the separation of such public shares from the units. While this is typically done electronically on 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 will likely not be able to exercise your Redemption Rights.

If a public stockholder fails to receive notice of CENAQ’s offer to redeem its public shares in connection with the business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed.

CENAQ will comply with the proxy rules when conducting redemptions in connection with the business combination. Despite CENAQ’s compliance with these rules, if a public stockholder fails to receive CENAQ’s proxy materials, such stockholder may not become aware of the opportunity to redeem its shares. In addition, the proxy materials that CENAQ will furnish to holders of its public shares in connection with the business combination will describe the various procedures that must be complied with in order to validly redeem public shares. In the event that a stockholder fails to comply with these or any other procedures, its shares may not be redeemed.

Whether a redemption of Class A Common Stock will be treated as a sale of such Class A Common Stock for U.S. federal income tax purposes will depend on a shareholder’s specific facts.

The U.S. federal income tax treatment of a redemption of Class A Common Stock will depend on whether the redemption qualifies as a sale of such Class A Common Stock under Section 302(a) of the Code, which will depend largely on the total number of shares of our stock treated as held by the stockholder electing to redeem Class A Common Stock (including any shares of stock constructively owned by the holder as a result of owning Private Placement Warrants or Public Warrants or otherwise) relative to all shares of our stock outstanding both before and after the redemption. If such redemption is not treated as a sale of Class A Common Stock for U.S. federal income tax purposes, the redemption will instead be treated as a corporate distribution of cash from us. For more information about the U.S. federal income tax treatment of the redemption of Class A Common Stock, see the section below entitled “Proposal No. 1 — The Business Combination Proposal — Material U. S. Federal Income Tax Considerations — U.S. Federal Income Taxation of U.S. Holders” or “Proposal No. 1 — The Business Combination Proposal — Material U.S. Federal Income Tax Considerations — U.S. Federal Income Taxation of Non-U.S. Holders,” as applicable.

If CENAQ is unable to consummate the business combination or any other Initial Business Combination by November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension), the Public Stockholders may be forced to wait beyond such date before redemption from the Trust Account.

If CENAQ is unable to consummate the business combination by November 16, 2022 (or by February 16, 2023 pursuant to the SPAC Extension), CENAQ will (a) cease all operations except for the purpose of winding up, (b) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at

a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to us to pay our franchise and income taxes as well as expenses relating to the administration of the Trust Account (less up to $100,000 of net interest released to us to pay dissolution expenses), divided by the number of then-outstanding public shares, which redemption will completely extinguish Public Stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law and (c) as promptly as reasonably possible following such redemption, subject to the approval of CENAQ’s remaining stockholders and the CENAQ Board, dissolve and liquidate, subject in each case to CENAQ’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

General Risk Factors

The business combination or post-combination company may be materially adversely affected by the ongoing COVID-19 pandemic.

Our ability to consummate the business combination may be materially adversely affected due to significant governmental measures being implemented to contain the outbreak of COVID-19 or its impact, including travel restrictions, the shutdown of businesses and quarantines, among others, which may limit our ability to have meetings with potential investors or affect the ability of Intermediate’s personnel, vendors and service providers to negotiate and consummate the business combination in a timely manner. The extent to which COVID-19 impacts the business combination or the post-combination company will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time, our ability to consummate the business combination may be materially adversely affected. Additionally, if the financial markets or the overall economy are impacted for an extended period, the post-combination company’s results of operations, financial position and cash flows may be materially adversely affected.

Changes in tax laws or the imposition of new or increased taxes may adversely affect Verde Clean Fuels’ financial condition, results of operations and cash flows.

Verde Clean Fuels will be a U.S. corporation and thus will be subject to U.S. corporate income tax on its worldwide income. Further, Verde Clean Fuels’ operations and customers will be located in the United States, and, as a result, Verde Clean Fuels will be subject to various U.S. federal, state and local taxes. U.S. federal, state and local and non-U.S. tax laws, policies, statutes, rules, regulations or ordinances could be interpreted, changed, modified or applied adversely to Verde Clean Fuels and may have an adverse effect on its financial condition, results of operations and cash flows.

For example, in the United States, several tax law changes have been previously proposed that would, if ultimately enacted, impact the U.S. federal income taxation of corporations. Such proposals include an increase in the U.S. income tax rate applicable to corporations (such as Verde Clean Fuels) from 21% to 28%. It is unclear whether this, similar or other changes will be enacted and, if enacted, how soon any such changes could take effect, and we cannot predict how any future changes in tax laws might affect us. Additionally, states in which we operate or own assets may impose new or increased taxes. Changes in tax laws or the imposition of new or increased taxes could adversely affect Verde Clean Fuels’ financial condition, results of operations and cash flows.

The new 1% U.S. federal excise tax on repurchases of corporate stock included in the Inflation Reduction Act of 2022 (the “IR Act”) could cause a reduction in the value of our Class A Common Stock or reduce the amount received by our stockholders if we are unable to complete this or another business combination and are required to redeem all existing shares after December 31, 2022.

On August 16, 2022, the IR Act was signed into law. The IR Act provides for, among other changes, a new 1% U.S. federal excise tax on certain repurchases (including redemptions) of stock by publicly traded U.S. corporations after December 31, 2022. The excise tax is imposed on the repurchasing corporation itself, not on its shareholders from whom the shares are repurchased. The amount of the excise tax is generally 1% of any positive difference between the fair market value of any shares repurchased by the repurchasing corporation during a taxable year and the fair market value of certain new stock issuances by the repurchasing corporation during the same taxable year.

In addition, a number of exceptions will apply to this excise tax. The U.S. Department of the Treasury (the “Treasury”) has been given authority to provide regulations and other guidance to carry out, and prevent the abuse or avoidance of, this excise tax.

Although the application of this excise tax is not entirely clear, any redemption or other repurchase effected by us that occurs after December 31, 2022, whether in connection with the business combination or otherwise, may be subject to this excise tax. Whether and to what extent we would be subject to the excise tax in connection with the business combination would depend on a number of factors, including (i) whether the business combination closes after December 31, 2022, (ii) the fair market value of any stock redeemed or repurchased in connection with the business combination, (iii) the nature and amount of the PIPE Financing (or any other equity issuances within the same taxable year as that of the business combination) and (iv) the content of any regulations and other guidance from the Treasury. In addition, because the excise tax would be payable by us and not by the redeeming holder, it could cause a reduction in the value of our Class A Common Stock.

Further, the application of the excise tax in the event of a complete liquidation of a publicly traded U.S. corporation is uncertain and has not been addressed by the Treasury in regulations or other guidance. If we are unable to complete this or another business combination and are required to redeem all of our existing shares after December 31, 2022, whether such redemptions are subject to this excise tax may depend on how such redemptions are structured and whether we are liquidated. If this excise tax were to apply to such redemptions, it is possible that the proceeds held in the Trust Account could be used to pay any excise tax owed by us, in which case the amount that would otherwise be received by our stockholders in connection with our liquidation would be reduced.

The excise tax would not apply to the extent that the business combination and any related redemptions occur before December 31, 2022.

The JOBS Act permits “emerging growth companies” like us to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies.

We qualify as an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such, we take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies, including (a) the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act, (b) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (c) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. As a result, our stockholders may not have access to certain information they deem important. We will remain an emerging growth company until the earliest of (a) the last day of the fiscal year (i) following August 17, 2026, the fifth anniversary of our IPO, (ii) in which we have total annual gross revenue of at least $1.235 billion (as adjusted for inflation pursuant to SEC rules from time to time) or (iii) in which we are deemed to be a large accelerated filer, which means the market value of our Class A Common Stock that is held by non-affiliates exceeds $700 million as of the last business day of our prior second fiscal quarter, and (b) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three year period.

In addition, Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the exemption from complying with new or revised accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as we are an emerging growth company. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. 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. We have elected to irrevocably 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, we will adopt the new or revised standard at the time public companies adopt the new or revised standard. This may make comparison of our financial statements with another emerging growth company that has not opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

We cannot predict if investors will find our Class A Common Stock less attractive because we will rely on these exemptions. If some investors find our Class A Common Stock less attractive as a result, there may be less active trading market for our Class A Common Stock and our stock price may be more volatile.

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

Introduction

The unaudited pro forma condensed combined balance sheet as of June 30, 2022 and the unaudited pro forma condensed combined statements of operations for the six months ended June 30, 2022 and the year ended December 31, 2021 present the historical financial statements of CENAQ and Intermediate, adjusted to reflect the business combination. The unaudited condensed combined pro forma balance sheet as of June 30, 2022 gives pro forma effect to the business combination and related transactions as if they had occurred on June 30, 2022. The unaudited pro forma condensed combined statement of operations data for the year ended December 31, 2021 and the six months ended June 30, 2022 gives pro forma effect to the business combination and related transactions as if they had been consummated on January 1, 2021. The unaudited pro forma condensed combined financial information has been prepared in accordance with Regulation S-X, as amended.

The business combination includes:

•        Holdings contributing 100% of the issued and outstanding limited liability company interests of Intermediate to OpCo in exchange for 22,500,000 Class C OpCo Units and an equal number of shares of Class C Common Stock;

•        the common control reverse recapitalization between CENAQ and Intermediate; and

•        the issuance and sale of 8,000,000 shares of Class A Common Stock for a purchase price of approximately $10.00 per share, for an aggregate purchase price of $80,000,000 in the PIPE Financing pursuant to the Subscription Agreements; provided that to the extent funds contained in the Trust Account immediately prior to Closing (after giving effect to the exercise of the Redemption Rights) exceed the Trust Threshold, each $10.00 increment of such excess funds shall reduce Arb’s commitment by $10.00 up to a maximum reduction of $20.0 million;

The unaudited pro forma condensed combined financial information has been developed from and should be read in conjunction with:

•        the notes accompanying the unaudited pro forma condensed combined financial statements;

•        the historical audited and unaudited financial statements of CENAQ included in CENAQ’s Form 10-K, as amended, for the year ended December 31, 2021 filed with the SEC on March 30, 2022 and Form 10-Q for the quarter ended June 30, 2022 filed with the SEC on August 26, 2022;

•        the historical audited and unaudited financial statements of Intermediate included elsewhere in this proxy statement;

•        the discussion of the financial condition and results of operations of CENAQ and Intermediate included elsewhere in this proxy statement; and

•        other information contained in this proxy statement, including the Business Combination Agreement and the description of certain terms thereof.

The unaudited pro forma condensed combined financial information assumes that the Public Stockholders approve the proposed business combination. CENAQ’s Public Stockholders may elect to redeem their CENAQ Class A Common Stock for cash even if they approve the proposed Business Combination. CENAQ cannot predict how many of its Public Stockholders will exercise their right to have their CENAQ Class A Common Stock redeemed for cash. As a result, the unaudited pro forma condensed combined financial statements present two redemption scenarios, as previously described:

•        Assuming No Redemptions; and

•        Assuming Maximum Redemptions.

The actual results will likely be somewhere within the ranges of outcomes shown, though precisely where cannot be presently determined.

The Transactions are being accomplished through an “Up-C” structure and the classification of consideration received by Holdings, as the equityholder of Intermediate immediately prior to the Closing, reflects such “Up-C” structure. Upon the Closing, Holdings, as the equityholder of Intermediate immediately prior to the Closing, is expected to hold a number of OpCo Units that are exchangeable for an aggregate of 22,500,000 shares of Class A Common Stock, or, at the option of Verde Clean Fuels, cash in an amount equal to the net proceeds raised by selling such Class A Common Stock in a contemporaneous sale or underwritten offering.

Pursuant to the Tax Receivable Agreement, Verde Clean Fuels will be required to pay 85% of the net cash savings in U.S. federal, state and local income tax and franchise tax (computed using simplifying assumptions to address the impact of state and local taxes), if any, that it actually realizes (or in certain cases is deemed to realize) in periods after the business combination as a result of certain increases in tax basis pursuant to the exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right and certain benefits attributable to imputed interest. Any such payments to TRA Holders will reduce the cash provided by the tax savings generated from future exchanges that would otherwise have been available to Verde Clean Fuels for other uses, including reinvestment or dividends to holders of Class A Common Stock. Cash tax savings from the remaining 15% of the tax benefits will be retained by Verde Clean Fuels. Verde Clean Fuels’ obligations under the Tax Receivable Agreement in connection with a change of control are subject to the Payment Cap of $50,000,000. The Payment Cap would not be reduced or offset by any amounts previously paid under the Tax Receivable Agreement or any amounts that are required to be paid (but have not yet been paid) for the year in which the change of control occurs or any prior years.

Due to the uncertainty of the amount and timing of future exchanges of Class C OpCo Units, the unaudited pro forma condensed combined financial information assumes that no exchanges of Class C OpCo Units have occurred and therefore, no increases in tax basis have been realized. Additionally, Verde Clean Fuels would recognize a full valuation allowance for any deferred tax asset realized based on Verde Clean Fuels’ current assessment of the future realizability.

The following summarizes the Verde Clean Fuels Common Stock outstanding under the two redemption scenarios:

____________

(1)      Assumes that no Public Stockholders exercise Redemption Rights with respect to their Class A Common Stock for a pro rata share of the funds in the Trust Account. Also assumes that no Public Warrants or Private Placement Warrants are exercised following Closing.

(2)      Assumes that all Public Stockholders, holding all 17,250,000 shares of Class A Common Stock, will exercise their Redemption Rights for an aggregate payment of $174.5 million (based on the estimated per share redemption price of approximately $10.11 per share) from the Trust Account. Also assumes that no Public Warrants or Private Placement Warrants are exercised following Closing.

(3)      Excludes 189,750 Underwriters Forfeited Shares owned by Imperial Capital, LLC and I-Bankers Securities, Inc. that will be forfeited as of Closing pursuant to the Underwriters Letter.

(4)      Represents the shares of Class C Common Stock to be received by Holdings pursuant to the business combination at the Closing and excludes (1) the 800,000 shares of Class A Common Stock that may be issued in the PIPE Financing and (ii) the 3,500,000 shares of Class C Common Stock that may be issued to Holdings upon the occurrence of the Triggering Events.

(5)      Represents 800,000 shares of Class A Common Stock to be acquired by Holdings in the PIPE Financing.

(6)      Arb represents $70,000,000 of the $72,000,000 in the PIPE commitments (excluding Holdings) and will have its PIPE commitment at Closing to the extent CENAQ’s Public Stockholders do not exercise their Redemption Rights. To the extent funds contained in the Trust Account immediately prior to the Closing (after giving effect to the exercise of Redemption Rights) exceed the Trust Threshold, each $10.00 increment of such excess funds shall reduce Arb’s commitment by $10.00 up to a maximum reduction of $20,000,000 (and in no event less than $50,000,000) resulting in $52,000,000 of PIPE commitments in the Assuming No Redemptions scenario. Excludes 800,000 shares of Class A Common Stock to be acquired by Holdings in the PIPE Financing.

(7)      Includes 253,125 and 825,000 shares of Class A Common Stock to be issued to the Sponsor and Anchor Investors, respectively, upon conversion of a portion of their current Class B Common Stock at Closing. Excludes 3,234,375 shares of Class A Common Stock issued to the Sponsor upon conversion of the remaining portion of its Class B Common Stock at Closing that are subject to forfeiture.

(8)      Includes 3,234,375 shares of Class A Common Stock issued to the Sponsor that are subject to forfeiture pursuant to the Sponsor Letter. These shares will no longer be subject to forfeiture upon the occurrence of the Triggering Events.

(9)      Excludes a total of 4,200,000 Private Placement Warrants to be forfeited as of Closing comprised of 2,475,000, 1,423,125 and 301,875 held by the Sponsor, Imperial Capital, LLC and I-Bankers Securities, Inc., respectively.

(10)    Includes 3,500,000 shares of Class C Common Stock issuable to Holdings upon the occurrence of the Triggering Events.

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET

As of June 30, 2022