UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(MARK ONE)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 2021
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to
Commission file number:
Aeries Technology, Inc.
(Exact Name of Registrant as Specified in Its Charter)
| Cayman Islands | 98-1587626 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
60 Paya Lebar Road, #08-13 Paya Lebar Square Singapore | 409051 | |
(Address of principal executive offices) | (Zip Code) |
(919)228-6404
(Registrant’s telephone number, including area code)
Worldwide Webb Acquisition Corp.
770 E Technology Way F13-16
Orem, UT 84997
(Issuer’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on | ||
The Stock Market | ||||
The Stock Market |
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation(§ (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
| Emerging growth company | ☒ | |||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule
As of December 6, 2021,November 14, 2023, there were 23,000,000 Class A ordinary shares, $0.0001 par value and 5,750,000 Class BV ordinary shares, $0.0001
AERIES TECHNOLOGY, INC.
FORM
TABLE OF CONTENTS
i
PART I –- FINANCIAL INFORMATION
Item 1. Interim Condensed Financial Statements
AERIES TECHNOLOGY, INC.
CONDENSED BALANCE SHEET
September 30, 2021 | ||||
ASSETS | ||||
Current assets: | ||||
Cash | $ | 265 | ||
Total current assets | 265 | |||
Deferred offering costs associated with proposed public offering | 714,419 | |||
Total assets | $ | 714,684 | ||
LIABILITIES AND SHAREHOLDER’S DEFICIT | ||||
Current liabilities: | ||||
Accounts payable | $ | 14,955 | ||
| Accrued offering and formation costs | 531,600 | |||
Promissory note payable - related party | 174,605 | |||
Total current liabilities | 721,160 | |||
Commitments and Contingencies (Note 5) | 0 | |||
Shareholder’s Deficit: | ||||
Preference shares, $0.0001 par value; 5,000,000 shares authorized; NaN issued and outstanding | 0 | |||
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; 0 shares issued and outstanding | 0 | |||
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 5,750,000 shares issued and outstanding (1)(2) | 575 | |||
Additional paid-in capital | 24,425 | |||
Accumulated deficit | (31,476 | ) | ||
Total shareholder’s deficit | (6,476 | ) | ||
Total Liabilities and Shareholder’s Deficit | $ | 714,684 | ||
| SEPTEMBER 30, | DECEMBER 31, | |||||||
| 2023 | 2022 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Cash | $ | 8,412 | $ | 48,126 | ||||
| Prepaid expenses | 39,845 | 304,314 | ||||||
| Other current assets | 837 | 8,334 | ||||||
| Total current assets | 49,094 | 360,774 | ||||||
| Marketable securities held in Trust Account | 49,992,699 | 234,716,046 | ||||||
| Total Assets | $ | 50,041,793 | $ | 235,076,820 | ||||
| LIABILITIES, ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION, AND SHAREHOLDERS’ DEFICIT | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 6,351,857 | $ | 676,652 | ||||
| Promissory note - related party | 557,810 | 200,000 | ||||||
| Accrued professional services fees | 2,414,548 | 3,091,220 | ||||||
| Accrued expenses | 62,267 | 42,267 | ||||||
| Total current liabilities | 9,386,482 | 4,010,139 | ||||||
| Derivative warrant liabilities | 1,001,640 | 614,040 | ||||||
| Deferred legal fees | - | 343,437 | ||||||
| Total liabilities | 10,388,122 | 4,967,616 | ||||||
| Commitments and Contingencies (Note 5) | ||||||||
| Class A ordinary shares subject to possible redemption, $ par value; and shares at $ and $ per share at September 30, 2023 and December 31, 2022, respectively | 49,892,699 | 234,616,046 | ||||||
| Shareholders’ deficit | ||||||||
| Preference shares, $ par value; shares authorized; issued or outstanding | - | - | ||||||
| Class A ordinary shares, $ par value; shares authorized; issued or outstanding (excluding 4,718,054 and 23,000,000 shares subject to possible redemption at September 30, 2023 and December 31, 2022, respectively) | - | - | ||||||
| Class B ordinary shares, $ par value; shares authorized; shares issued and outstanding | 575 | 575 | ||||||
| Additional paid-in capital | - | - | ||||||
| Accumulated deficit | (10,239,603 | ) | (4,507,417 | ) | ||||
| Total shareholders’ deficit | (10,239,028 | ) | (4,506,842 | ) | ||||
| Total Liabilities, Ordinary Shares Subject to Possible Redemption, and Shareholders’ Deficit | $ | 50,041,793 | $ | 235,076,820 | ||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
1
AERIES TECHNOLOGY, INC.
CONDENSED STATEMENTS OF OPERATIONS
For the three months ended September 30, 2021 | For the period from March 5, 2021 (inception) through September 30, 2021 | |||||||
Formation costs | $ | 375 | $ | 31,476 | ||||
Net loss | $ | (375 | ) | $ | (31,476 | ) | ||
Weighted average shares outstanding, basic and diluted (1)(2) | 5,000,000 | 5,000,000 | ||||||
Basic and diluted net loss per share | $ | (0.00 | ) | $ | (0.01 | ) | ||
(Unaudited)
| Three Months Ended | Three Months Ended | Nine Months Ended | Nine Months Ended | |||||||||||||
| September 30, | September 30, | September 30, | September 30, | |||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| General and administrative expenses | $ | 1,597,474 | $ | 1,444,411 | $ | 5,344,586 | $ | 2,101,731 | ||||||||
| Loss from operations | (1,597,474 | ) | (1,444,411 | ) | (5,344,586 | ) | (2,101,731 | ) | ||||||||
| Change in fair value of derivative warrant liabilities | (554,880 | ) | (63,240 | ) | (387,600 | ) | 10,404,000 | |||||||||
| Gain on marketable securities, dividends and interest, held in Trust Account | 630,499 | 957,118 | 4,711,256 | 1,121,345 | ||||||||||||
| Gain on settlement of underwriting fees | - | 202,458 | - | 202,458 | ||||||||||||
| Net (loss) income | $ | (1,521,855 | ) | $ | (348,075 | ) | $ | (1,020,930 | ) | $ | 9,626,072 | |||||
| Weighted average shares outstanding of Class A ordinary shares subject to possible redemption, basic and diluted | 4,718,054 | 23,000,000 | 11,615,638 | 23,000,000 | ||||||||||||
| Basic and diluted net (loss) income per share, Class A ordinary shares subject to possible redemption | $ | (0.15 | ) | $ | (0.01 | ) | $ | (0.06 | ) | $ | 0.33 | |||||
| Weighted average shares outstanding of Class B non-redeemable ordinary shares, basic and diluted | 5,750,000 | 5,750,000 | 5,750,000 | 5,750,000 | ||||||||||||
| Basic and diluted net (loss) income per share, Class B non-redeemable ordinary shares | $ | (0.15 | ) | $ | (0.01 | ) | $ | (0.06 | ) | $ | 0.33 | |||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
2
AERIES TECHNOLOGY, INC.
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDER’STEMPORARY EQUITY AND SHAREHOLDERS’ DEFICIT
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023
(Unaudited)
| Temporary Equity | Ordinary Shares | Additional | Total | |||||||||||||||||||||||||
| Class A | Class B | Paid-In | Accumulated | Shareholders’ | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
| Balance as of January 1, 2023 | 23,000,000 | $ | 234,616,046 | 5,750,000 | $ | 575 | $ | - | $ | (4,507,417 | ) | $ | (4,506,842 | ) | ||||||||||||||
| Remeasurement of Class A ordinary shares to redemption value | - | 2,369,220 | - | - | - | (2,369,220 | ) | (2,369,220 | ) | |||||||||||||||||||
| Net loss | - | - | - | - | - | (1,532,112 | ) | (1,532,112 | ) | |||||||||||||||||||
| Balance as of March 31, 2023 | 23,000,000 | $ | 236,985,266 | 5,750,000 | $ | 575 | $ | - | $ | (8,408,749 | ) | $ | (8,408,174 | ) | ||||||||||||||
| Redemption of Class A ordinary shares | (18,281,946 | ) | (189,434,603 | ) | - | - | - | - | - | |||||||||||||||||||
| Remeasurement of Class A ordinary shares to redemption value | - | 1,711,537 | - | - | - | (1,711,537 | ) | (1,711,537 | ) | |||||||||||||||||||
| Net income | - | - | - | - | - | 2,033,037 | 2,033,037 | |||||||||||||||||||||
| Balance as of June 30, 2023 | 4,718,054 | $ | 49,262,200 | 5,750,000 | $ | 575 | $ | - | $ | (8,087,249 | ) | $ | (8,086,674 | ) | ||||||||||||||
| Remeasurement of Class A ordinary shares to redemption value | - | 630,499 | - | - | - | (630,499 | ) | (630,499 | ) | |||||||||||||||||||
| Net loss | - | - | - | - | - | (1,521,855 | ) | (1,521,855 | ) | |||||||||||||||||||
| Balance as of September 30, 2023 | 4,718,054 | $ | 49,892,699 | 5,750,000 | $ | 575 | $ | - | $ | (10,239,603 | ) | $ | (10,239,028 | ) | ||||||||||||||
And for the period from March 5, 2021 (inception) throughthree and nine months ended September 30, 2021
Ordinary Shares | Additional | Total | ||||||||||||||||||
Class B | Paid-In | Accumulated | Shareholder’s | |||||||||||||||||
Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
Balance as of March 5, 2021 (inception) | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||
Issuance of ordinary shares to Sponsor (1)(2) | 5,750,000 | 575 | 24,425 | — | 25,000 | |||||||||||||||
Net loss | — | — | — | (31,101 | ) | (31,101 | ) | |||||||||||||
Balance as of June 30, 2021 | 5,750,000 | 575 | 24,425 | (31,101 | ) | (6,101 | ) | |||||||||||||
Net loss | — | — | — | (375 | ) | (375 | ) | |||||||||||||
Balance as of September 30, 2021 | 5,750,000 | $ | 575 | $ | 24,425 | $ | (31,476 | ) | $ | (6,476 | ) | |||||||||
(Unaudited)
| Temporary Equity | Ordinary Shares | Additional | Total | |||||||||||||||||||||||||
| Class A | Class B | Paid-In | Accumulated | Shareholders’ | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
| Balance as of January 1, 2022 | 23,000,000 | $ | 232,300,000 | 5,750,000 | $ | 575 | $ | - | $ | (19,798,626 | ) | $ | (19,798,051 | ) | ||||||||||||||
| Net income | - | - | - | - | - | 3,799,755 | 3,799,755 | |||||||||||||||||||||
| Balance as of March 31, 2022 | 23,000,000 | $ | 232,300,000 | 5,750,000 | $ | 575 | $ | - | $ | (15,998,871 | ) | $ | (15,998,296 | ) | ||||||||||||||
| Remeasurement of Class A ordinary shares to redemption value | - | 85,071 | - | - | - | (85,071 | ) | (85,071 | ) | |||||||||||||||||||
| Net income | - | - | - | - | - | 6,174,392 | 6,174,392 | |||||||||||||||||||||
| Balance as of June 30, 2022 | 23,000,000 | $ | 232,385,071 | 5,750,000 | $ | 575 | $ | - | $ | (9,909,550 | ) | $ | (9,908,975 | ) | ||||||||||||||
| Gain on settlement of underwriting fees | - | - | - | - | - | 7,847,542 | 7,847,542 | |||||||||||||||||||||
| Remeasurement of Class A ordinary shares to redemption value | - | 957,118 | - | - | - | (957,118 | ) | (957,118 | ) | |||||||||||||||||||
| Net loss | - | - | - | - | - | (348,075 | ) | (348,075 | ) | |||||||||||||||||||
| Balance as of September 30, 2022 | 23,000,000 | $ | 233,342,189 | 5,750,000 | $ | 575 | $ | - | $ | (3,367,201 | ) | $ | (3,366,626 | ) | ||||||||||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
3
AERIES TECHNOLOGY, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
For the period from March 5, 2021 (inception) through September 30, 2021 | ||||
Cash Flows from Operating Activities: | ||||
Net loss | $ | (31,476 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Formation costs funded by note payable through Sponsor | 9,091 | |||
Formation costs paid in exchange for issuance of ordinary shares | 20,421 | |||
Changes in operating assets and liabilities: | ||||
Accounts payable | 376 | |||
Accrued offering and formation costs | 1,500 | |||
Net cash used in operating activities | (88 | ) | ||
Cash Flows from Financing Activities: | ||||
Proceeds from promissory note payable - related party | 65,000 | |||
Repayment of promissory note payable - related party | (5,000 | ) | ||
Offering costs paid | (59,647 | ) | ||
Net cash provided by financing activities | 353 | |||
Net increase in cash | 265 | |||
Cash - beginning of period | 0 | |||
Cash - end of period | $ | 265 | ||
Supplemental disclosure of noncash investing and financing activities: | ||||
Deferred offering costs included in accounts payable | $ | 14,579 | ||
Deferred offering costs included in accrued offering and formation costs | $ | 530,100 | ||
Deferred offering costs paid through promissory note - related party | $ | 105,514 | ||
Issuance of Founder Shares in exchange for payment of deferred offering costs | $ | 25,000 | ||
| For The Nine Months Ended September 30, 2023 | For The Nine Months Ended September 30, 2022 | |||||||
| Cash Flows from Operating Activities | ||||||||
| Net (loss) income | $ | (1,020,930 | ) | $ | 9,626,072 | |||
| Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||||||||
| Gain on marketable securities (net), dividends and interest, held in Trust Account | (4,711,256 | ) | (1,121,345 | ) | ||||
| Formation and operating expenses funded by note payable through Sponsor | 87,810 | (6,499 | ) | |||||
| Change in fair value of derivative warrant liabilities | 387,600 | (10,404,000 | ) | |||||
| Formation and operating expenses paid in exchange for Founder Shares | - | (202,458 | ) | |||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid and other assets | 271,966 | 286,722 | ||||||
| Accounts payable | 5,675,205 | 28,540 | ||||||
| Accrued expenses | (656,672 | ) | 1,383,234 | |||||
| Net cash provided by (used in) operating activities | 33,723 | (409,734 | ) | |||||
| Cash Flows from Investing Activities | ||||||||
| Redemption of Class A ordinary shares | 189,434,603 | - | ||||||
| Net cash provided by investing activities | 189,434,603 | - | ||||||
| Cash Flows from Financing Activities | ||||||||
| Redemption of Class A ordinary shares | (189,434,603 | ) | - | |||||
| Proceeds from note payable and advances from related party | 270,000 | - | ||||||
| Deferred legal fees paid | (343,437 | ) | - | |||||
| Net cash used in financing activities | (189,508,040 | ) | - | |||||
| Net decrease in cash | (39,714 | ) | (409,734 | ) | ||||
| Cash - beginning of period | 48,126 | 503,204 | ||||||
| Cash - end of period | $ | 8,412 | $ | 93,470 | ||||
| Supplemental disclosure of noncash investing and financing activities: | ||||||||
| Remeasurement of Class A shares to redemption value | $ | 4,711,256 | $ | 1,042,189 | ||||
| Deferred underwriting fees payable | $ | - | $ | (7,847,542 | ) | |||
| Offering costs and formation costs paid through promissory note - related party | $ | - | $ | 201,962 | ||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
4
AERIES TECHNOLOGY, INC.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Note 1 - Description Ofof Organization, And Business Operations,
Organization and General
Aeries Technology, Inc. (the “Company”) is a blank check companywas incorporated in Cayman Islands on March 5, 2021.2021. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses (the “Business Combination”). The Company is an emerging growth company and, as such, the Company is subject to all of the risks associated with emerging growth companies
As of September 30, 2021,2023, the Company had not yet commenced any operations. All activityactivities for the period from March 5, 2021 (inception) through September 30, 2021 relates2023, relate to the Company’s formation, and the initial public offering (“Initial Public Offering”), which is described below, and subsequent to thesearch of a target for Initial Public Offering, searching for a business combination.Business Combination. The Company will not generate any operating revenues until after the completion of aits Initial Business Combination, at the earliest. The Company will generate
On October 22, 2021, the Company consummated itsthe Initial Public Offering of units (the “ Units ”)“Units”). Each Unit consists of 1 share of Class A common stock of the Company, par value $0.0001 per share (the “ Class A common stock ”), and one half of warrant of the Company (the “Public Warrants ”), with each whole Public Warrant entitling the holder thereof to purchase 1 share of Class A common stock for $11.50 per share. The Units were sold at a price of $10.00$ per Unit, generating additional gross proceeds to the Company of $200,000,000 (see, which is described in Note 3).
Simultaneously with the closing of the Initial Public Offering, and pursuant to the Private Placement Warrant Purchase Agreement, dated October 19, 2021, by and between the Company and the Sponsor (the “ Private Warrant Purchase Agreement ”), the Company completed the private sale of 8,000,000 warrants (the “ Private“Private Placement Warrants ”)Warrants”) at a purchase price of $1.00$1.00 per Private Placement Warrant (the “Private Placement”), to theWorldwide Webb Acquisition Sponsor, generating gross proceeds to the Company of $8,000,000 (such sale, the “ Private Placement ”). On November 15, 2021, simultaneously with the sale of the Over-allotment Units, the Company completed a private placement with the Sponsor for an additional 900,000 warrants at a price of $1.00 per warrantLLC (the “ Additional Private Placement Warrants ” and, together with the Public Warrants and the Private Placement Warrants, the “ Warrants ”)“Sponsor”), generating gross proceeds to the Company of $900,000.
Subsequently, on November 11, 2021, the underwriter exercised the over-allotment option in full, and the closing of the netissuance and sale of the additional units (the “Over-Allotment Units”) occurred on November 15, 2021. In connection with the over-allotment exercise, the Company issued Over-Allotment Units, representing Ordinary Shares and public warrants at a price of $ per Unit, generating total gross proceeds of $30,000,000.
Substantially concurrently with the closing of the sale of the Over-Allotment Units, the Company completed the private sale of 900,000 Private Placement Warrants (“Additional Private Placement Warrants”) to the Sponsor at a purchase price of $1.00 per Private Placement Warrant, generating gross proceeds to the Company of $900,000.
Transaction costs amounted to $21,834,402, including $8,050,000 in deferred underwriting fees, $4,600,000 in upfront underwriting fees, and $9,184,402 in other offering costs related to the Initial Public Offering. Approximately $ of these expenses are non-cash offering costs associated with the Class B shares purchased by the anchor investors.
Following the closing of the Initial Public Offering on October 22, 2021 and underwriters’ exercise of Over-Allotment option on November 15, 2021, an amount of $232,300,000 ($10.10 per Unit) of the proceeds from the Initial Public Offering, (including the Over-allotment Units ($10.00 per Unit)) and $2,300,000including $8,050,000 of the proceeds of the sale of the Private Placement Warrants (including the Additional Private Placement Warrants) has been depositedunderwriters’ deferred discount was placed in a U.S.-based trust account (the “ Trust Account ”)“Trust Account”) at Bank of America, N.A. maintained by Continental Stock Transfer & Trust Company, acting as trustee.
5
The Company’s memorandum and articles of association, as amended, provides that, other than the Company will be ablewithdrawal of interest to complete a Business Combination successfully. The Company must complete one or more initial Business Combinations having an aggregate fair market value of at least 80%pay taxes, if any, none of the net assetsfunds held in the Trust Account (as defined below) (excluding the amount of deferred underwriting discounts held in Trust and taxes payable on the income earned on the Trust Account) at the time of the agreement to enter into the initial Business Combination. However, the Company only intends to complete a Business Combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act 1940, as amended (the “Investment Company Act”). Upon the closing of the Proposed Public Offering, management has agreed that an amount equal to at least $10.10per Unit sold in the Proposed Public Offering, including the proceeds from the sale of the private placement warrants, will be held in a trust account (“Trust Account”) located in the United States with Continental Stock Transfer & Trust Company acting as trustee, and invested only in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule2a-7promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations, as determined by the Company,released until the earlier of: (i) the completion of athe Initial Business Combination andCombination; (ii) the distributionredemption of the Trust Account as described below.
On March 11, 2023, the Company entered into the Business Combination Agreement (the “Combination Period”“Business Combination Agreement”), with WWAC Amalgamation Sub Pte. Ltd., a Singapore private company limited by shares and a direct wholly-owned Subsidiary of the Company, with company registration number 202300520W (“Amalgamation Sub”), and Aark Singapore Pte. Ltd., a Singapore private company limited by shares, with company registration number 200602001D (“AARK”, together with the Company and Amalgamation Sub, collectively, the “Parties” and individually a “Party”). Aeries Technology Group Business Accelerators Private Limited, an Indian private company limited by shares (“Aeries”), is a subsidiary of AARK. AARK is wholly owned by Mr. Venu Raman Kumar (the “Sole Shareholder”). The Business Combination Agreement and the transactions contemplated thereby were approved by the boards of directors of each of the Company, Amalgamation Sub and AARK, and by the sole shareholders of each of Amalgamation Sub and AARK. Please refer to the Form 8-K that was filed with the SEC on March 20, 2023.
On April 14, 2023, the Company held an extraordinary general meeting of shareholders (the “Meeting”) and approved two proposals to amend the Company’s amended and restated memorandum and articles of association (the “Articles”). This approval extended the liquidation date of the Company to October 22, 2023. In connection with the vote to approve these proposals, holders of Class A ordinary shares exercised their right to redeem their shares for cash at a redemption price of approximately $ per share, for an aggregate redemption amount of $189,434,603, leaving $48,887,722 in the Company’s trust account and Class A ordinary shares remain outstanding.
On October 16, 2023, the Company held another extraordinary general meeting of where the shareholders have notapproved a proposal to amend the Company’s amended the Memorandumand restated memorandum and Articles of Association to extend such Combination Period,the date by which the Company will (i)must (1) consummate a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (a “business combination”), (2) cease allits operations except for the purpose of winding up; (ii)up if it fails to complete such business combination, and (3) redeem all of the Company’s Class A ordinary shares sold in the IPO, from 24 months from the closing of the IPO to 25 months from the closing of the IPO or such earlier date as promptlyis determined by the Company’s Board of Directors (the “Board”) to be in the best interests of the Company and to allow the Company, without another shareholder vote, by resolution of the Board, to elect to further extend the Extended Date in one-month increments up to five additional times (with each such extension being upon five days’ advance notice in writing), for a total of up to 30 months from the closing of the IPO, unless the closing of a business combination shall have occurred prior thereto. By this approval, the Company has until April 22, 2024 to consummate a business combination without approval of the Company’s shareholders. In connection with the vote to approve the Extension Amendment Proposal, holders of Class A ordinary shares exercised their right to redeem their shares for cash at a redemption price of approximately $ per share, for an aggregate redemption amount of approximately $10.0 million. As a result, approximately $40.3 million will remain in the Company’s trust account and Class A ordinary shares remain outstanding as reasonably possible but no more than ten business days thereafter subjectof the approval date.
On June 1, 2023, in connection with the Business Combination, the Company entered into a subscription agreement (the “Subscription Agreement”) with a certain investor (the “PIPE Investor”), pursuant to lawfully available funds therefor, redeemwhich, among other things, the Public Shares, at aper-shareprice, payable in cash, equalPIPE Investor has agreed to subscribe for and purchase from the Company. The Company has agreed to issue and sell to the PIPE Investor, an aggregate amount then on deposit in the Trust Account, including interest earnedof newly issued Class A ordinary shares for an aggregate purchase price of $, on the funds held in the Trust Accountterms and not previously released to the Company to pay its taxes, if any (less up to $100,000 of interest to pay dissolution expenses) divided by the number of the then outstanding Public Shares, which redemption will completely extinguish Public Shareholder’s rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law; and (iii) as promptly as reasonably possible following such redemption, subject to the approvalconditions set forth therein (the “PIPE Financing”). The Subscription Agreement contains customary conditions to closing, including the consummation of the remaining shareholders andBusiness
Combination substantially concurrently with the boardconsummation of directors, liquidate and dissolve, subject in each casethe PIPE Financing. As of September 30, 2023 shares related to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.
6
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering, although substantially all of the net proceeds of the Initial Public Offering are intended to be generally applied toward consummating an Initial Business Combination. The Initial Business Combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80%80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on income earned on the Trust Account) at the time of the agreement to enter into the Initial Business Combination. Furthermore, there is no assurance that the Company will be able to successfully effect an Initial Business Combination.
The Company, after signing a definitive agreement for an Initial Business Combination, will either (i) seek shareholder approval of the Initial Business Combination at a meeting called for such purpose in connection with which shareholders may seek to redeem their shares, regardless of whether they vote for or against the Initial Business Combination, for cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the Initial Business Combination, including interest but less taxes payable, or (ii) provide shareholders with the opportunity to sell their Public Shares to the Company by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount in cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the Initial Business Combination, including interest but less taxes payable. The decision as to whether the Company will seek shareholder approval of the Initial Business Combination or will allow shareholders to sell their Public Shares in a tender offer will be made by the Company, solely in its discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require the Company to seek shareholder approval, unless a vote is required by law or under NASDAQ rules. If the Company seeks shareholder approval, it will complete its Initial Business Combination only if a majority of the outstanding ordinary shares voted are voted in favor of the Initial Business Combination. However, in no event will the Company redeem its Public Shares in an amount that would cause its ordinary shares to no longer qualify for exemption from the Securities and Exchange Commission’s (the “SEC”) “penny stock” rules. In such case, the Company would not proceed with the redemption of its Public Shares and the related Initial Business Combination, and instead may search for an alternate Initial Business Combination.
If the Company holds a shareholder vote or there is a tender offer for shares in connection with an Initial Business Combination, a public shareholder will have the right to redeem its shares for an amount in cash equal to its pro rata share of the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the Initial Business Combination, including interest but less taxes payable. As a result, such Class A ordinary shares were recorded at redemption amount and classified as temporary equity upon the completion of the Initial Public Offering, in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, “Distinguishing Liabilities from Equity.”
Pursuant to the Company’s Memorandummemorandum and Articlesarticles of Associationassociation if the Company is unable to complete the Initial Business Combination within 1824 months from the closing of the Initial Public Offering, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter subject to lawfully available funds therefor, redeem the Public Shares, at a$100,000$100,000 of interest to pay dissolution expenses and net of taxes payable), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public shareholder’s rights as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining shareholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. The Sponsor and the Company’s independent director nominees will not be entitled to rights to liquidating distributions from the Trust Account with respect to any Founder Shares (as defined below) held by them if the Company fails to complete the Initial Business Combination within 18 months of the closing of the Initial Public Offering. However, if the Sponsor or any of the Company’s directors, officers or affiliates acquires Class A ordinary shares in or after the Initial Public Offering, they will be entitled to liquidating distributions from the Trust Account with respect to such shares if the Company fails to complete the Initial Business Combination within the prescribed time period.
In the event of a liquidation, dissolution or winding up of the Company after an Initial Business Combination, the Company’s shareholders are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of shares, if any, having preference over the ordinary shares. The Company’s shareholders have no preemptive or other subscription rights. There are no sinking fund provisions applicable to the ordinary shares, except that the Company will provide its shareholders with the opportunity to redeem their Public Shares for cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account, upon the completion of the Initial Business Combination, subject to the limitations described herein.
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Liquidity and capital resources
On a routine basis, the Company assesses going concern considerations in accordance with FASB ASC 205-40 “Presentation of Financial Statements - Going Concern”. As of September 30, 2021,2023, the Company had $265 ina cash balance of $8,412and a working capital deficiencydeficit of $720,895.
If the Company’s estimates of the Trust Accountcosts of identifying a target business, undertaking in-depth due diligence, and isnegotiating a Business Combination are less than the actual amount necessary to do so, the Company may have insufficient funds available forto operate its business prior to an Initial Business Combination. Moreover, the Company’s working capital purposes.
In connection with the Company’s officersassessment of going concern considerations in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that the mandatory liquidation and directors may, but are not obligatedsubsequent dissolution raises substantial doubt about the Company’s ability to providecontinue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company Working Capital Loans,be required to liquidate after April 22, 2024. The financial statements do not include any adjustment that might be necessary if the Company is unable to continue as defined below (see Note 5). As of September 30, 2021, there were no amounts outstanding under any Working Capital Loans.
Risks and Uncertainties
In February 2022, the World Health Organization (“WHO”) announcedRussian Federation and Belarus commenced a global health emergency becausemilitary action with the country of Ukraine. As a new strainresult of coronavirus (the“COVID-19outbreak”). In March 2020,this action, various nations, including the WHO classifiedUnited States, have instituted economic sanctions against theCOVID-19outbreak as a pandemic, based on the rapid increase in exposure globally. The full impact of theCOVID-19outbreak continues to evolve. Management continues to evaluate Russian Federation and Belarus. Further, the impact of theCOVID-19outbreakthis action and related sanctions on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact isworld economy are not readily determinable as of the date of these financial statements and the specific impact on the Company’s financial condition, results of operations, and cash flows is also not determinable as of the date of these financial statements.
Inflation Reduction Act of 2022
On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The financial statements doIR Act provides for, among other things, a new U.S. federal 1% excise tax on certain repurchases of stock by publicly traded U.S. domestic corporations and certain U.S. domestic subsidiaries of publicly traded foreign corporations occurring on or after January 1, 2023. The excise tax is imposed on the repurchasing corporation itself, not includeits shareholders from which shares are repurchased. The amount of the excise tax is generally % of the fair market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the 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 the excise tax. Any redemption or other repurchase that occurs after December 31, 2022, in connection with a Business Combination, extension vote or otherwise, may be subject to the excise tax. Whether and to what extent the Company would be subject to the excise tax in connection with a Business Combination, extension vote or otherwise would depend on a number of factors, including (i) the fair market value of the redemptions and repurchases in connection with the Business Combination, extension or otherwise, (ii) the structure of a Business Combination, (iii) the nature and amount of any adjustments that might result“PIPE” or other equity issuances in connection with a Business Combination (or otherwise issued not in connection with a Business Combination but issued within the same taxable year of a Business Combination) and (iv) the content of regulations and other guidance from the outcomeTreasury. In addition, because the excise tax would be payable by the Company and not by the redeeming holder, the mechanics of this uncertainty.any required payment of the excise tax have not been determined. The foregoing could cause a reduction in the cash available on hand to complete a Business Combination and inhibit the Company’s ability to complete a Business Combination.
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Note 2 - Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited condensed financial statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for financial information and pursuant to the rules and regulations of the SEC. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP. In the opinion of management, the unaudited condensed financial statements reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the balances and results for the periods presented. The interim results for the periodsthree and nine months ended September 30, 20212023 are not necessarily indicative of the results to be expected for the year ending December 31, 20212023 or for any future interim periods.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that aan emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply toused.
Use of Estimates
The preparation of the condensedconsolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the more significant accounting estimates included in these financial statements is the determination of the fair value of the warrant liability. Such estimates may be subject to change as more current information becomes available and accordinglyAccordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company had $8,412 and $48,126 in cash and no cash equivalents, outside of the funds held in the Trust Account, as of September 30, 2023 and December 31, 2022, respectively.
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Derivative Financial Instruments
The Company accounts for the Warrants, Forward Purchase Agreement (as defined below), and Working Capital Loan conversion option (collectively, the “Instruments”) in accordance with the guidance contained in ASC 815-40 under which the Instruments do not meet the criteria for equity treatment and must be recorded as liabilities. The conversion feature within the Working Capital Loan gives the Sponsor an option to convert the loan to warrants of the Company’s Class A ordinary shares. This bifurcated feature is assessed at the end of each reporting period to conclude whether additional liability should be recorded. The Instruments are subjected to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statement of operations. See Note 5 and 7 for further discussion of the pertinent terms of the Warrants and Forward Purchase Agreement and Note 8 for further discussion of the methodology used to determine the value of the Warrants, Forward Purchase Agreement, and Working Capital Loan conversion option.
Marketable Securities Held in Trust Account
At September 30, 2023 and December 31, 2022, the assets held in the Trust Account of $49,992,699 and $234,716,046, respectively, were invested in money market funds.
Class A Ordinary Shares Subject to Possible Redemption
All of the Class A ordinary shares sold as part of the Units in the IPO contain a redemption feature which allows for the redemption of such Public Shares in connection with the Company’s liquidation if there is a shareholder vote or tender offer in connection with the Business Combination and in connection with certain amendments to the Company’s amended and restated certificate of incorporation. In accordance with SEC and its staff’s guidance on redeemable equity instruments, which has been codified in ASC 480-10-S99, redemption provisions not solely within the control of the Company require ordinary shares subject to redemption to be classified outside of permanent equity. Therefore, all Class A ordinary shares have been classified outside of permanent equity.
The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable ordinary shares are affected by charges against additional paid in capital and accumulated deficit. The ordinary shares subject to possible redemption reflected on the condensed balance sheets as of September 30, 2023 and December 31, 2022 is reconciled in the following table:
| Schedule of Reconciliation of Ordinary Shares Subject To Possible Redemption | ||||
| Class A ordinary shares subject to possible redemption at December 31, 2021 | $ | 232,300,000 | ||
| Remeasurement of Class A ordinary shares to redemption value | 2,316,046 | |||
| Class A ordinary shares subject to possible redemption at December 31, 2022 | $ | 234,616,046 | ||
| Remeasurement of Class A ordinary shares to redemption value | 4,711,256 | |||
| Redemption of Class A ordinary shares | (189,434,603 | ) | ||
| Class A ordinary shares subject to possible redemption at September 30, 2023 (unaudited) | $ | 49,892,699 |
Concentrations of Credit Risk
Financial instruments that potentially subject the Company to concentration of credit risk consist of a cash account in a financial institution which, at times may exceed the Federal depository insurance coverage of $250,000. At September 30, 2023 and December 31, 2022, the Company had not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
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Fair Value of Financial Instruments
Except for the Warrant, Forward Purchase Agreement, and Working Capital Loan Liabilities as described above, the fair value of the Company’s assets and liabilities, which qualify as financial instruments under the Financial Accounting Standards Board (the “FASB”) ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the condensed balance sheets.
Fair Value Measurements
Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
Level 1- Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Valuation adjustments and block discounts are not being applied. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a significant degree of judgment.
Level 2- Valuations based on (i) quoted prices in active markets for similar assets and liabilities, (ii) quoted prices in markets that are not active for identical or similar assets, (iii) inputs other than quoted prices for the assets of liabilities, or (iv) inputs that are derived principally from or corroborated by market through correlation or other means.
Level 3- Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
Derivative Financial Instruments
The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the condensed balance sheets as current or noncurrent based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date.
Offering Costs
Offering costs consist of legal, accounting, underwriting and Formation Costs
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Net loss per share of ordinary shares is computed by dividing netNet loss by the weighted average number of shares of ordinary sharesissued and outstanding during the period. Weighted average shares were reduced forThe Company has not considered the effect of an aggregate of 750,000 shares oftheir Forward Purchase Agreement, warrants sold in the Initial Public Offering, private placement to purchase Class BA ordinary shares, thatand Working Capital Loan warrants in the calculation of diluted loss per share, since the instruments are subject to forfeiture ifnot dilutive.
For the over-allotment option is not exercised by the underwriters (see Note 4). Atthree and nine months ended September 30, 2021,2023, the inclusion of dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in the earnings of the Company is contingent on a future event. For the three and nine months ended September 30, 2022, the Company did 0tnot have any dilutive securities and other contracts that could, potentially, be exercised or converted into shares of ordinary shares and then share in the earnings of the Company. As a result, diluted loss per share is the same as basic loss per share for the periodperiods presented.
The Company considers all short-term investmentshas two classes of shares, which are referred to as Class A ordinary shares and Class B ordinary shares (the “Founder Shares”). Earnings is shared pro rata between the two classes of shares as long as an Initial Business Combination is the most likely outcome. Accretion associated with an original maturitythe redeemable Class A ordinary shares is excluded from income (loss) per share as the redemption value approximates fair value.
A reconciliation of three months or less when purchasednet (loss) income per share is below:
| Schedule of Income Per Share, Basic and Diluted | ||||||||||||||||
| For The Three Months Ended September 30, 2023 | For The Three Months Ended September 30, 2022 | For The Nine Months Ended September 30, 2023 | For The Nine Months Ended September 30, 2022 | |||||||||||||
| Redeemable Class A Ordinary Shares | ||||||||||||||||
| Numerator: Net (loss) income allocable to Redeemable Class A Ordinary Shares | ||||||||||||||||
| Net (loss) income allocable to Redeemable Class A Ordinary Shares | $ | (685,915 | ) | $ | (278,460 | ) | $ | (682,886 | ) | $ | 7,700,858 | |||||
| Denominator: Weighted Average Share Outstanding, Redeemable Class A Ordinary Shares | ||||||||||||||||
| Basic and diluted weighted average shares outstanding, Redeemable Class A | 4,718,054 | 23,000,000 | 11,615,638 | 23,000,000 | ||||||||||||
| Basic and diluted net (loss) income per share, Class A ordinary shares subject to possible redemption | $ | (0.15 | ) | $ | (0.01 | ) | $ | (0.06 | ) | $ | 0.33 | |||||
| Non-Redeemable Class B Ordinary Shares | ||||||||||||||||
| Numerator: Net (loss) income allocable to non-redeemable Class B Ordinary Shares | ||||||||||||||||
| Net (loss) income allocable to non-redeemable Class B Ordinary Shares | $ | (835,940 | ) | $ | (69,615 | ) | $ | (338,044 | ) | $ | 1,925,214 | |||||
| Denominator: Weighted Average Non-Redeemable Class B Ordinary Shares | 5,750,000 | 5,750,000 | 5,750,000 | 5,750,000 | ||||||||||||
| Basic and diluted net (loss) income per share, Class B non-redeemable ordinary shares | $ | (0.15 | ) | $ | (0.01 | ) | $ | (0.06 | ) | $ | 0.33 | |||||
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Income Taxes
The Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be cash equivalents.recovered or settled. The Company held casheffect on deferred tax assets and cash equivalentsliabilities of $265a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Deferred tax assets were deemed immaterial as of September 30, 2021.
FASB ASC Topic 740 “Income Taxes,” which prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax
Recent Accounting Pronouncements
The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.
Note 3 - Initial Public Offering
Pursuant to the Initial Public Offering
Anchor Investors purchased an aggregate of 3,000,000 additional Units$198.6 million of units in this offering at the offering price, and we have agreed to cover over-allotments, if any. On November 15, 2021,direct the Underwriters exercised the over-allotment optionunderwriters to purchase an additional 3,000,000 Units, generating aggregate gross proceedsoffer to each Anchor Investor up to such number of $30,000,000units and incurring $1,650,000 in underwriting fees comprised of an initial payment of $600,000 and $1,050,000 of deferred underwriting commissions.
Note 4 - Related Party Transactions
Founder Shares
In March 2021, the Sponsorour sponsor subscribed for an aggregate of Class B ordinary shares, par value $0.0001$ per share, for an aggregate purchase price of $25,000$ (“founder shares”). On September 17, 2021, the Sponsorour sponsor effected a surrender of Class B ordinary shares to the company for 0no consideration, resulting in a decrease in the number of Class B ordinary shares outstanding from to , such that the total number of founder shares would represent 20% of the total number of ordinary shares outstanding upon completion of this offering (of which Class B ordinary shares are subject to forfeiture if the underwriters do not exercise their overallotment option).
Ten
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Administrative SupportServices Agreement
The Company entered into an agreementAdministrative Services Agreement pursuant to which the Company will pay an affiliate of theour Sponsor up to $10,000
Promissory Note — RelatedNote-Related Party
On March 5, 2021, the Sponsor issued an unsecured promissory note to the Company (the “Promissory“Original Note”), pursuant to which the Company may borrow up to an aggregate principal amount of
The Amended Note includes a provision that allows the Sponsor to convert up to $1,500,000 of any unpaid principal on the note into warrants of the post-business combination entity at the price of $ per warrant at the option of the lender. Such warrants would be identical to the Private Placement Warrants, including as to exercise price, exercisability, and exercise period. As of September 30, 2023 and December 31, 2022, the Company has borrowed $557,810 and $200,000 under the promissory amended note, respectively, and will become payable on the earlier of (i) April 22, 2024 or (ii) the consummation of the Initial Public Offering.Business Combination.
In addition to the promissory note, the Sponsor has agreed to pay for expenses on the Company’s behalf that are payable on demand. The Company owed $222,716 and $202,716 to the Sponsor in expenses unrelated to the Promissory Note as of September 30, 2023 and December 31, 2022, respectively. As of September 30, 2021, the Company has borrowed
Private Placement Warrants
The Sponsor agreed to purchasepurchased an aggregate of 8,000,000 Private Placement Warrants, (or 8,900,000 Private Placement Warrants if the underwriter’s over-allotment option is exercised in full), at a price of $1.00$1.00 per Private Placement Warrant, or approximately $8,000,000$8,000,000 in the aggregate, (or $8,900,000 if the underwriter’s over-allotment option is exercised in full) in a private placement that occurred simultaneously with the closing of the Proposed Public Offering.IPO. An additional 900,000 Private Placement Warrants were purchased upon the Underwriter’s exercise of over-allotment option in full. Each Private Placement Warrant is exercisable for one whole share of Class A ordinary shares at a price of $11.50 per ordinary share. A portion of the proceeds from the sale of the private placement warrants and the sale of forward purchase units to the Sponsor will bewere added to the proceeds from the Proposed Public OfferingIPO to be held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the Private Placement Warrants will expire worthless. The Private Placement Warrants will benon-redeemable(except as described below in Note 5 under “Warrants-Redemption of warrants when the price per share of Class A ordinary shares equals or exceeds $10.00”) so long as they are held by the initial purchasers or their permitted transferees.
Related Party Loans
In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination or, at the lender’s discretion, up to $1,500,000$1,500,000 of such Working Capital Loans may be convertible into warrants of the post Business Combination entity at a price of $1.00$1.00 per warrant. The warrants would be identical to the Private Placement Warrants. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. As of September 30, 2021, there were 0To date, the Company had no borrowings under the Working Capital Loans outstanding.
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Note 5 - Commitments Andand Contingencies
Registration and Shareholders Rights
The holders of Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans, if any (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the Working Capital Loans), will be entitled to registration rights pursuant to a registration rights agreement to be signed
Administrative Support Agreement
Commencing on the date that the Company’s securities were first listed on the NASDAQ, the Company agreed to pay the Sponsor or an affiliate thereof in an amount equal to $10,000 per month for office space, utilities and secretarial and administrative support made available to the Company, up to a maximum of $160,000. The Company recorded an aggregate of $0 and $20,000 for the three and nine months ended September 30, 2023, respectively, in general and administrative expenses in connection with the related agreement in the accompanying statement of operations. The Company ceased paying these monthly fees in February 2023, as the $160,000 threshold was met in this month.
The warrant agreement provides that the terms of the warrants may be amended without the consent of any shareholder or warrant holder to cure any ambiguity or correct any defective provision but requires the approval by the holders of at least a majority of the then outstanding public warrants to make any change that adversely affects the interests of the registered holders of public warrants. Accordingly, the Company may amend the terms of the public warrants in a manner adverse to a holder of public warrants if holders of at least a majority of the then outstanding public warrants approve of such amendment. Although the Company’s ability to amend the terms of the public warrants with the consent of at least a majority 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 shares, shorten the exercise period or decrease the number of Class A ordinary shares purchasable upon exercise of a warrant.
Underwriting Agreement
The Company paid an underwriting discount of 2.0%2.0% of the per Unit offering price to the Underwriter at the closing of the Initial Public Offering, with an additional fee of 3.5%3.5% of the gross offering proceeds payable only upon the Company’s completion of its Initial Business Combination (the “Deferred Discount”). The Deferred Discount of $7,000,000 will$8,050,000 would become payable to the Underwriter from the amounts held in the Trust Account solely in the event the Company completes its Initial Business Combination. Combination unless the Underwriter waives their right to the underwriting fees.
The Company has granted the Underwriter aUnderwritersunderwriter exercised thetheir over-allotment option in full on November 11, 2021, and the closing of the issuance and sale of the additional units (the “Over-Allotment Units”) occurred on November 15, 2021.
Effective as of September 30, 2022, the underwriters from the Initial Public Offering resigned and withdrew from their role in the Business Combination and thereby waived their entitlement to the deferred underwriting fees of $8,050,000, which the Company has recorded as a gain on settlement of underwriter fees on the statements of shareholders’ deficit for the year ended December 31, 2022 for $7,847,542, which represents the original amount recorded to accumulated deficit, and the remaining balance of $202,548 representing the amount recorded to the statements of operations for the year ended December 31, 2022. Based on this arrangement, the Company is no longer obligated to pay the underwriter if the Company merges with a Target in the future.
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Note6-Warrant
The Company will accountaccounted for the 18,000,00020,400,000 warrants issued in connection with the ProposedInitial Public Offering (the 10,000,00011,500,000 Public Warrants and the 8,000,0008,900,000 Private Placement Warrants assuming the underwriters’ over-allotment option is not exercised)Warrants) in accordance with the guidance contained in ASCmustmuch be recorded as a liability. Accordingly, the Company will classifyclassifies each warrant as a liability at its fair value. This liability is subject to
Each whole Warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described herein. Only whole Warrants are exercisable. The Warrants will become exercisable on the later of 30 days after the completion of the Initial Business Combination or 12 months from the closing of the Initial Public Warrants may only be exercised for a whole numberOffering and will expire five years after the completion of shares. NaNthe Initial Business Combination or earlier upon redemption or liquidation. No fractional Public Warrants will be issued upon separation of the Units and only whole Public Warrants will trade.
The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Proposed Public Offering; provided in each case that the Company has an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or holders are permitted to exercise their warrants on a cashless basis under certain circumstances as a result of (i) the Company’s failure to have an effective registration statement by the60th business day after the closing of the initial Business Combination or (ii) a notice of redemption described under “Redemption of warrants when the price per share of Class A ordinary shares equals or exceeds $10.00”). The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of its initial Business Combination, the Company will use its commercially reasonable efforts to file with the SEC and have an effective registration statement covering the Class A ordinary shares issuable upon exercise of the warrants and will use its commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of the Company’s initial Business Combination and to maintain a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed. If the shares issuable upon exercise of the warrants are not registered under the Securities Act in accordance with the above requirements, the Company will be required to permit holders to exercise their warrants on a cashless basis. However, no warrant will be exercisable for cash or on a cashless basis, and the Company 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. Notwithstanding the above, if the Company’s Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a “cashless basis” in accordance with
The Warrants will be adjusted (to the nearest cent) to be equal to 100% and 180% of the higher of the Market Value and the Newly Issued Price, respectively.
| ● | 30 days after the completion of the Initial Business Combination or, |
| ● | 12 months from the closing of the Initial Public Offering; |
provided in each case that we have an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the Warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement).
The Company is not registering Class A ordinary shares issuable upon exercise of the Warrants at this time. However, the Company has agreed that as soon as practicable, but in no event later than fifteen (15) business days, after the closing of the Initial Business Combination, the Company will use its best efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the Warrants. The Company will use its best efforts to cause the same to become effective and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the Warrants in accordance with the provisions of the warrant agreement. Notwithstanding the above, if the Company’s Class A ordinary shares is at the time of any exercise of a Warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Warrants who exercise their Warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, it will not be required to file or maintain in effect a registration statement, but the Company will be required to use its best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
The Warrants will expire five years after the completion of the Initial Business Combination or earlier upon redemption or liquidation. On the exercise of any Warrant, the Warrant exercise price will be paid directly to us and not placed in the Trust Account.
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Once the Warrants become exercisable, the Company may redeem the outstanding Warrants for cash (except as described herein with respect to the Private Placement Warrants):
| ● | In whole and not in part; |
| ● | At a price of $ per Warrant; |
| ● | Upon a minimum of 30 days’ prior written notice of redemption, referred to as the 30-day redemption period; and |
| ● | if, and only if, the last sale price of our Class A ordinary shares equals or exceeds $ per share (as adjusted for share splits, dividends, reorganization, recapitalizations, and the like) for any trading days within a -trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders. |
The Company will not redeem the Warrants for cash unless a registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the Warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout theAny such exercise would not be on a cashless basisIf and would require the exercising warrant holder to pay the exercise price for each warrant being exercised.
Except as described below, none of Class A ordinary shares equalsthe Private Placement Warrants will be redeemable by the Company so long as they are held by the initial purchasers of the Private Placement Warrants or exceeds
Once the warrantsWarrants become exercisable, the Company may redeem the outstanding warrants:
| ● | in whole and not in part; |
| ● | at a price of $0.10 per Warrant, provided that holders will be able to exercise their Warrants on a cashless basis |
| ● | upon a minimum of 30 days’ prior written notice of redemption; and |
| ● | if, and only if, the last sale price of the Company’s Class A ordinary shares equals or exceeds $ per share (as adjusted for share splits, dividends, reorganizations, recapitalizations, and the like) on the trading day prior to the date on which we send the notice of redemption to the warrant holders. |
The “fair market value” of Class A ordinary shares;
No fractional Class A ordinary shares per warrant (subjectwill be issued upon redemption. If, upon redemption, a holder would be entitled to adjustment).
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Note 7 - Shareholder’sShareholders’ Deficit
Preference Shares
The Company is authorized to issue shares of preference shares, with a par value of $0.0001$ per share, with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. AtAs of September 30, 2021,2023 and December 31, 2022, there were 0 shares of preference shares issued or outstanding.
Class
The Company is authorized to issue Class A ordinary shares with a par value of $0.0001$ per share. HoldersAs of Class A ordinary shares are entitled to one vote for each share. At September 30, 2021,2023 and December 31, 2022, there were 0 Class A ordinary shares issued and outstanding.
Class B Ordinary Shares
The Company is authorized to issue Class B ordinary shares with a par value of $0.0001$ per share. HoldersAs of theSeptember 30, 2023 and December 31, 2022, Class B ordinary shares are entitled to one vote for each share. At September 30, 2021, there were 5,750,000 Class B ordinary shares issued and outstanding.
Holders of the Class A ordinary shares and holders of the Class B ordinary shares will vote together as a single class on all matters submitted to a vote of the Company’s shareholders, except as required by law or stock exchange rule; provided that only holders of the Class B ordinary shares shall have the right to vote on the election of the Company’s directors prior to the initial Business Combination.
The Class B founder shares will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination, or earlier at the option of the holder, on a20%20% of the sum of all Class A ordinary shares issued and outstanding upon the completion of this offering, plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with our initial business combination, excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination. Prior to our initial business combination, holders of the Class B ordinary shares will have the right to appoint all of our directors and may remove members of the board of directors for any reason in any general meeting held prior to or in connection with the completion of our initial business combination. On any other matter submitted to a vote of our shareholders, holders of the Class B ordinary shares and holders of the Class A ordinary shares will vote together as a single class, except as required by law and subject to the amended and restated Memorandummemorandum and Articlesarticles of Association.association.
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Note 8 - Fair Value Measurements
The following table presents information about the Company’s assets that are measured at fair value on a recurring basis as of September 30, 2023 and December 31, 2022 including the fair value hierarchy of the valuation techniques that the Company utilized to determine such fair value.
| Summary of Assets That Are Measured at Fair Value on a Recurring Basis | ||||||||||
| Description | Level | Fair Value | ||||||||
| September 30, 2023 | Marketable securities | 1 | $ | 49,992,699 | ||||||
| December 31, 2022 | Marketable securities | 1 | $ | 234,716,046 | ||||||
The following tables present information about the Company’s liabilities that are measured at fair value on a recurring basis as of September 30, 2023 and December 31, 2022, including the fair value hierarchy of the valuation techniques that the Company utilized to determine such fair value.
| Summary of Liabilities Measured at Fair Value on a Recurring Basis | ||||||||||||||||
| September 30, 2023 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Liabilities: | ||||||||||||||||
| Public Warrants | $ | 564,650 | $ | - | $ | - | $ | 564,650 | ||||||||
| Private Placement Warrants | - | 436,990 | - | 436,990 | ||||||||||||
| Total liabilities | $ | 564,650 | $ | 436,990 | $ | - | $ | 1,001,640 | ||||||||
| December 31, 2022 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
| Liabilities: | ||||||||||||||||
| Public Warrants | $ | 346,150 | $ | - | $ | - | $ | 346,150 | ||||||||
| Private Placement Warrants | - | 267,890 | - | 267,890 | ||||||||||||
| Total liabilities | $ | 346,150 | $ | 267,890 | $ | - | $ | 614,040 | ||||||||
On December 9, 2021, the Public Warrants surpassed the 52-day threshold waiting period to be publicly traded in accordance with the Prospectus filed October 21, 2021. Once publicly traded, the observable input qualifies the liability for treatment as a Level 1 liability. As such, as of September 30, 2023 and December 31, 2022, the Company classified the Public Warrants as Level 1. The Private Warrants were valued based on the trading price of Public Warrants, which is considered to be a Level 2 fair value measurement. To estimate the value of the Private Placement Warrants, the Company used the public trading price of the Public Warrants. This value was adjusted to reflect the value of the issuer call provision of the Public Warrants, as this right is not applicable to the Private Placement Warrants unless they are sold by the initial holders. There were no transfers between fair value levels during the three and nine months ended September 30, 2023.
The following table presents a summary of the changes in the fair value of Derivative Warrant Liabilities:
| Summary of The Changes In The Fair Value of Derivative Warrant Liabilities | ||||||||||||
| Public Warrant Liability | Public Warrant Liability | Total | ||||||||||
| Fair value at January 1, 2023 | $ | 346,150 | $ | 267,890 | $ | 614,040 | ||||||
| Change in fair value (loss) | 218,500 | 169,100 | 387,600 | |||||||||
| Fair value as of September 30, 2023 | $ | 564,650 | $ | 436,990 | $ | 1,001,640 | ||||||
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Note 89 - Subsequent Events
Management has evaluated the impact of subsequent events and transactions that occurred after the balance sheet date up to the date that the unaudited condensed financial statements were issued. Based upon this review, the Company did not identify any subsequent events, except as described below, that would have not been disclosedrequired adjustment or disclosure in the unaudited condensed financial statements,statements.
Non-Redemption Agreement
On October 8, 2023 and October 10, 2023, the Company and its Sponsor entered into non-redemption agreements (each, a “Non-Redemption Agreement”) with certain unaffiliated third parties (each, a “Holder,” and collectively, the “Holders”) in exchange for the Holder or Holders agreeing either not to request redemption in connection with the Company’s extension or to reverse any previously submitted redemption demand in connection with the Extension with respect to an aggregate of Class A ordinary shares, par value $0.0001 per share (the “Class A ordinary shares”, and such shares subject to each Non-Redemption Agreement, the “Non-Redeemed Shares”), of the Company sold in its initial public offering (the “IPO”) at the extraordinary general meeting called by the Company to, among other thanthings, approve an amendment to the Company’s amended and restated memorandum and articles of association to extend the date by which the Company must (1) consummate a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (a “business combination”), (2) cease its operations except for the purpose of winding up if it fails to complete such business combination, and (3) redeem all of the Company’s Class A ordinary shares sold in the Company’s IPO, from 24 months from the closing of our IPO to 25 months from the closing of our IPO or such earlier date as is determined by our Board of Directors (the “Board”) to be in the best interests of the Company (such date, the “Extended Date”), and to allow the Company, without another shareholder vote, by resolution of our Board, to elect to further extend the Extended Date in one-month increments up to five additional times (with each such extension being upon five days’ advance notice in writing), for a total of up to 30 months from the closing of our IPO, unless the closing of a business combination will have occurred prior thereto (each an “Extension”).
Trust Agreement and Extension Amendments
On October 16, 2023, the Company had an extraordinary meeting and in connection with such meeting, the Company received shareholders approval to amend the Trust Agreement and extended the Company’s for additional period. In connection with the extension proposal, holders of Class A ordinary shares exercised their right to redeem their shares for cash at a redemption price of approximately $ per share, for an aggregate redemption amount of approximately $10.0 million. As a result, approximately $40.3 million will remain in the Company’s trust account and Class A ordinary shares remain outstanding.
Registration Rights Agreement Amendment
On October 26, 2023, the Company, the Sponsor and the other parties thereto (the “Holders”) entered into an amendment (the “Registration Rights Agreement Amendment”) to that certain registration rights agreement, dated October 19, 2021, among the Company, the Sponsor and the Holders (the “Registration Rights Agreement”), to, among other things, amend the definition of “Founder Shares Lock-up Period” to conform to the amendment to the transfer restrictions contained in the Letter Agreement as described below:
Subscription Agreement
On October 22, 2021,28, 2023, November 5, 2023, and November 6, 2023, in connection with the Business Combination, the Company consummated its Initial Public Offering of 20,000,000 units.entered into a subscription agreement (the “Subscription Agreement”) with a certain investor (the “PIPE Investor”), pursuant to which, among other things, the PIPE Investor has agreed to subscribe for and purchase Class A ordinary shares from the Company. The Units were sold at a price of $10.00 per Unit, generating gross proceedsSubscription Agreement contains customary conditions to the Company of $200,000,000. See Note 3 for additional information. Occurring simultaneously withclosing, including the consummation of the IPO,Business Combination. Refer to Form 8-K filed with the SEC on November 6, 2023.
Forward Purchase Agreement
On November 5, 2023 and November 6, 2023, the Company completed the sale of 8,000,000 Private Placement Warrants at a purchase price of $1.00 per Private Placement Warrant,entered into amendments to the Sponsor.
Non-Redemption Agreement
On November 11, 2021, the underwriter exercised their over-allotment option3, 2023 and November 5, 2023, in full, resulting in an additional 3,000,000 units (the “Over-Allotment Units”) being issued and sold on November 15, 2021. In connection with the over-allotment exercise,Business Combination, the Company issued 3,000,000 Over-Allotment Units, representing 3,000,000 Ordinary Sharesentered into non-redemption agreements with certain investors (the “NRA Investors”), pursuant to which, among other things, the NRA Investors agreed to reverse the redemptions of up to an aggregate of Class A ordinary shares of the Company. Refer to Form 8-K filed with the SEC on November 3, 2023 and 1,500,000 public warrantsNovember 6, 2023.
Consummation of Business Combination
On November 6, 2023, as contemplated in the Business Combination Agreement, the Company consummated the Business Combination, following the approval by the Company’s shareholders at a pricethe annual meeting of $10.00 per Unit, generating total gross proceeds of $30,000,000. Substantially concurrentlyshareholders held on November 2, 2023. In connection with the closing of the sale of the Over-Allotment Units,Business Combination, the Company completedadopted the private saleProposed Amended and Restated Articles of 900,000 Private Placement WarrantsAssociation and changed its name from Worldwide Webb Acquisition Corp. to the Sponsor at a purchase price of $1.00 per Private Placement Warrant, generating gross proceeds to the Company of $900,000.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of the Company’sour financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report.annual report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Overview
We are a newly incorporated blank check company, incorporated in the Cayman Islands on March 5, 2021, formedas a Cayman Islands exempted company for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or other similar Business Combinationbusiness combination with one or more businesses. We have not selected any business combination target. We intend to effectuate our Business Combinationinitial business combination using cash derived from the proceeds of the Initial Public Offeringour IPO and the sale of the Private Placement Warrants,private placement warrants, our shares, debt or a combination of cash, shares and debt.
The issuance of additional ordinary shares or preference shares in a business combination:
| ● | may significantly dilute the equity interest of investors in our IPO, which dilution would increase if the anti-dilution provisions in the Class B ordinary shares resulted in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the Class B ordinary shares; |
| ● | may subordinate the rights of holders of ordinary shares if preference shares are issued with rights senior to those afforded our ordinary shares; |
| ● | could cause a change of control if a substantial number of our ordinary shares is issued, which result in the resignation or removal of our present directors and officers; |
| ● | may have the effect of delaying or preventing a change of control of us by diluting the share ownership or voting rights of a person seeking to obtain control of us; |
| ● | may adversely affect prevailing market prices for our units, ordinary shares and/or warrants; and |
| ● | may not result in adjustment to the exercise price of our warrants. |
Similarly, if we issue debt or otherwise incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.
| ● | default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations; |
| ● | acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
| ● | our immediate payment of all principal and accrued interest, if any, if the debt is payable on demand; |
| ● | our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while the debt is outstanding; |
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| ● | our inability to pay dividends on our ordinary shares; |
| ● | using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our ordinary shares, expenses, capital expenditures, acquisitions and other general corporate purposes; |
| ● | limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
| ● | increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and |
| ● | limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. |
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities and those necessary to prepare for our IPO. Following our IPO, we will not generate any operating revenues until after completion of our initial business combination. We will generate non-operating income in the form of interest income on cash and cash equivalents after our IPO. There has been no significant change in our financial or trading position and no material adverse change has occurred since the date of our audited financial statements. After our IPO, we expect to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses. We expect our expenses to increase substantially after the closing of our IPO.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities from the March 5, 2021 (inception)inception through September 30, 20212023 were organizational activities, and those necessary to prepare for the Initial Public Offering, and searchingdescribed below, the Company’s search for a target described below.business with which to complete a Business Combination and activities in connection with the proposed Transactions. We do not expect to generate any operating revenues until after the completion of our initial Business Combination. We expect to generatefrom the proceeds from the Initial Public Offering.on marketable securities. We expect that we will incur increasedare incurring expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with searching for, and completing a Business Combination.
For the three months ended September 30, 2021,2023, we had a net loss of $375, which only consisted$1,521,855, consisting of formation costsgeneral and administrative expenses of $375.
For the period from the March 5, 2021 (inception) throughthree months ended September 30, 2021,2022, we had a net loss of $31,476,$348,075 which onlyconsists of general and administrative expenses of $1,441,411, offset by and a gain from the change in fair value of derivative warrant liabilities of $63,240 and by an unrealized gain on marketable securities held in the Trust Account of $957,118.
For the nine months ended September 30, 2023, we had net loss of $1,020,930, which consisted of formation costsgeneral and administrative expenses of $31,476.
For the nine months ended September 30, 2022, we had net income of $9,626,072, which consists of general and administrative expenses of $2,101,762, offset by and a gain from the change in fair value of derivative warrant liabilities of $10,404,000, gain in settlement of underwriters’ fees of $202,459, and by an unrealized gain on marketable securities held in the Trust Account of $1,121,245.
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Liquidity, and Capital Resources
Until the consummation of the Initial Public Offering, the Company’s only source of liquidity was an initial purchase of ordinary shares by the Sponsor and loans from our Sponsor.
On October 22, 2021, we consummated the Initial Public Offering of 20,000,000 Unitsshares, at a price of $10.00 per Unit, generating gross proceeds of $200,000,000. Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 8,000,000 Private Placement Warrants to the Sponsor at a price of $1.00 per Private Placement Warrantwarrant, generating gross proceeds of $8,000,000.
Following the Initial Public Offering and the sale of the Private Placement Warrants, a total of $202,000,000$232,300,000 was placed in the Trust Account. TransactionWe incurred $21,834,402 in transaction costs, amounted to $21,995,104 consisting of $4,818,000including $4,600,000 of underwriting commissions, $8,431,500fees, $8,050,000 of deferred underwriting commissions,fees and $8,745,604$9,184,402 of other offering costs related to the Initial Public Offering. Approximately $8,306,250 of these expenses arenon-cashoffering costs associated with the Class B shares purchased by the anchor investors.
For the period from the March 5, 2021 (inception) throughnine months ended September 30, 2021,2023, cash usedprovided in operating activities was $89. A net$33,723. Net loss of $31,476$1,020,930 was offset by Formationgeneral and operating expenses funded by the Sponsor of $9,091, formation and operatingadministrative expenses paid by the Sponsorrelated party of $87,810, interest earned on investment held in exchange for Founder SharesTrust Account of $20,421,$4,711,256, changes in fair value of derivative warrant liabilities of $387,200, and changes in operating assets and liabilities, which used $1,875generated $5,290,499 of cash.
As of September 30, 2021, we did not hold cash held in the trust account. We intend to use substantially all of the funds that will be held in the Trust Account, including any amounts representing interest earned on the Trust Account, which interest shall be net of taxes payable and excluding deferred underwriting commissions, to complete our Business Combination. We may withdraw interest from the Trust Account to pay taxes, if any. To the extent that our share capital or debt is used, in whole or in part, as consideration to complete a Business Combination, any remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
As of September 30, 2023, we had cash and marketable securities held in the Trust Account of $49,992,699. We may withdraw interest to pay our income taxes, if any. We intend to use substantially all the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account (which interest shall be net of taxes payable and excluding deferred underwriting commissions) to complete our Business Combination. To the extent that our share capital is used, in whole or in part, as consideration to complete a Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
In order to fund working capital deficienciesneeds or finance transaction costs in connection with a Business Combination, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete a Business Combination, we maywould repay such loaned amounts out of the proceeds of the Trust Account released to us.amounts. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts, but no proceeds from our Trust Account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.00 per warrant unit at the option of the lender. The warrants would be identical to the Private Placement Warrants.
We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking
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Liquidity and Going Concern Considerations
On a routine basis, we assess going concern considerations in transactions that create relationshipsaccordance with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitatingoff-balancesheet arrangements. We have not entered into anyoff-balancesheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased anynon-financialassets.
We have until April 22, 2024 to consummate a Business Combination. If a Business Combination is not consummated by this date and an extension is not requested by the Sponsor there will be a mandatory liquidation and subsequent dissolution of the Company. Uncertainty related to consummation of a Business Combination raises substantial doubt about our ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should we be required to liquidate after April 22, 2024. The financial statements do not meetinclude any adjustment that might be necessary if we are unable to continue as a going concern. No adjustments have been made to the criteriacarrying amounts of assets or liabilities to reflect a required liquidation after April 22, 2024.
Related Party Transactions
In March 2021, our sponsor subscribed for equity treatmentan aggregate of 8,625,000 Class B ordinary shares, par value $0.0001 per share, for an aggregate purchase price of $25,000. On September 17, 2021, our sponsor effected a surrender of 2,875,000 Class B ordinary shares to us the company for no consideration, resulting in a decrease in the number of Class B ordinary shares outstanding from 8,625,000 to 5,750,000, such that the total number of founder shares would represent 20% of the total number of ordinary shares outstanding upon completion of our IPO.
We have entered into an Administrative Services Agreement pursuant to which we pay our sponsor a total of $10,000 per month for office space, utilities, secretarial, administrative and mustsupport services, up to a maximum of $160,000. The maximum threshold of $160,000 was reached in February 2023 and the Company ceased paying monthly fees in the following months.
Our sponsor, directors and officers, or any of their respective affiliates, will be recordedreimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as liabilities.identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, directors, officers or our or any of their respective affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.
In addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or certain of our directors and officers may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans may be repaid only out of funds held outside the trust account. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants issued to our sponsor. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account.
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Our sponsor purchased an aggregate of 8,900,000 private placement warrants at a price of $1.00 per warrant ($8,900,000 in the aggregate) in a private placement that occurred simultaneously with the closing of our IPO. Each private placement warrant entitles the holder to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as provided herein. The private placement warrants are identical to the warrants sold as part of the units in our IPO except that, so long as they are held by our sponsor or its permitted transferees: (1) they will not be redeemable by us (except under certain circumstances when the price per Class A ordinary share equals or exceeds $10.00); (2) they (including the Class A ordinary shares issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by our sponsor until 30 days after the completion of our initial business combination; (3) they may be exercised by the holders on a cashless basis; and (4) they (including the ordinary shares issuable upon exercise of these warrants) are entitled to registration rights.
Pursuant to a registration rights agreement entered into with our initial shareholders and anchor investors, we may be required to register certain securities for sale under the Securities Act. These holders, and holders of warrants issued upon conversion of working capital loans, if any, are entitled under the registration rights agreement to make up to three demands that we register certain of our securities held by them for sale under the Securities Act and to have the securities covered thereby registered for resale pursuant to Rule 415 under the Securities Act. In addition, these holders have the right to include their securities in other registration statements filed by us. However, the registration rights agreement provides that we will classifynot be required to effect or permit any registration or cause any registration statement to become effective until the Warrantssecurities covered thereby are released from their lock-up restrictions, as liabilities at their fair valuedescribed herein. We will bear the costs and adjustexpenses of filing any such registration statements. See “Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters-Registration Rights.”
Off-Balance Sheet Arrangements, Commitments and Contractual Obligations, Quarterly Results
As of September 30, 2023, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual obligations. No unaudited quarterly operating data is included in this report as we have conducted no operations to date.
JOBS Act
On April 5, 2012, the WarrantsJOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We will qualify as an “emerging growth company” and under the JOBS Act will be allowed to fair value at each reporting period. This liability is subjectcomply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing tore-measurementat each balance sheet date until exercised, and any change in fair value is recognized in our unaudited condensed statement delay the adoption of operations.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, currently adopted, would have a material effectas an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things: (1) provide an auditor’s attestation report on our system of internal controls over financial statements.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
As of September 30, 2021,2023, we were not subject to any market or interest rate risk. Following the consummation of our Initial Public Offering, the net proceeds of our Initial Public Offering, including amounts in the Trust Account, have been invested in certain U.S. government obligations with a maturity of 185 days or less or in certain money market funds that invest solely in U.S. treasuries. Due to the short-term nature of these investments, we believe there will be no associated material exposure to interest rate risk.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended September 30, 2021,2023, as such term is defined in Rules(as definedwere not effective due to the material weakness described below.
In connection with the preparation of our financial statements for the period ended September 30, 2023, we identified certain errors relating to financial statement review. As part of such a process, management concluded that a material weakness in Rules13a-15(e)and15d-15(e)underinternal control over financial reporting existed related to the Exchange Act) were effective.
Changes in Internal Control Over Financial Reporting
There was no change in our internal control over financial reporting that occurred during this fiscal quarter of 20212023 covered by this Quarterly Report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting, except as stated below.
In light of the material weakness described above, we plan to enhance our processes of reviewing financial statements. Our plans at this time include increased communication with third-party service providers and additional procedures to ensure that the review of the Company’s financial statements have sufficient documentation to determine accuracy. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
ITEM 1A. RISK FACTORS.
In addition to the other information set forth in this Quarterly Report on Formfinal prospectusannual report on Form 10-K filed with the SEC on October 21, 2021 (“Final Prospectus”).March 31, 2023. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, or future results. There have been no material changes in the risk factors discussed in our Final Prospectus.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
ITEM 5. OTHER INFORMATION.
None.
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ITEM 6. EXHIBITS
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| AERIES TECHNOLOGY, INC. | |||||||
| Date: November 14, 2023 | |||||||
| Name: | Sudhir Appukuttan Panikassery | ||||||
| Title: | |||||||
| Chief Executive Officer and | |||||||
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