UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2023
☐
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 001-41179
AROGO CAPITAL ACQUISITION CORP.
(Exact name of registrant as specified in its charter)
Delaware | | 87-1118179 |
(State or Other Jurisdiction
of Incorporation) | | (I.R.S. Employer
Identification No.) |
848 Brickell Avenue, Penthouse 5
Miami, Florida | | 33131 |
(Address of principal executive offices) | | (zip code) |
(786) 442-1482
(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 which registered |
Units, each consisting of one share of Class A common stock and one Redeemable Warrant | | AOGOU | | The Nasdaq Stock Market LLC |
Class A Common Stock, $0.0001 par value per share | | AOGO | | The Nasdaq Stock Market LLC |
Redeemable Warrants, each warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50 per share | | AOGOW | | The Nasdaq Stock Market LLC |
Securities registered pursuant to Section 12(g)
of the Act: None
Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No
☒
Indicate by check mark if the registrant is not
required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes ☐ No
☒
Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 requirement
for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant
has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T 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 non-accelerated filer, a smaller reporting company, or emerging growth company.
See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,”
and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ |
Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
| Emerging growth company | ☒ |
If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant
has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its audit report. ☐
If securities are registered
pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing
reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark
whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by
any of the registrant’s executive officers during the relevant recovery period pursuant to § 240.10D-1(b). ☐
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☒ No
☐
As of June 30, 2023, the aggregate market value
of the registrant’s shares of common stock held by non-affiliates of the registrant was $52,829,219, based on a closing market price
of $10.44 on the Nasdaq Stock Market.
As of May 9, 2024, 1,762,409 shares of Class
A Common Stock, par value $0.0001 per share, and 2,587,500 shares of Class B Common Stock, $0.0001 par value per share, issued and outstanding.
TABLE OF CONTENTS
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This annual report, including,
without limitation, statements under the heading “Management’s Discussion and Analysis of Financial Condition and Results
of Operations,” includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the
Exchange Act. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,”
“estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,”
“will,” “potential,” “projects,” “predicts,” “continue,” or “should,”
or, in each case, their negative or other variations or comparable terminology. There can be no assurance that actual results will not
materially differ from expectations. Such statements include, but are not limited to, any statements relating to our ability to consummate
any acquisition or other business combination and any other statements that are not statements of current or historical facts. These statements
are based on management’s current expectations, but actual results may differ materially due to various factors, including, but
not limited to our:
| ● | ability to complete our initial
business combination; |
| ● | success in retaining or recruiting,
or changes required in, our officers, key employees or directors following an initial business combination; |
| ● | officers and directors allocating
their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination,
as a result of which they would then receive expense reimbursements; |
| ● | potential ability to obtain
additional financing to complete an initial business combination; |
| ● | pool of potential business
combination targets; |
| ● | failure to maintain the listing
on, or the delisting of our securities from, Nasdaq or an inability to have our securities listed on Nasdaq or another national securities
exchange following our initial business combination; |
| ● | the ability of our officers
and directors to generate a number of potential investment opportunities; |
| ● | potential change in control
if we acquire one or more target businesses for stock; |
| ● | public securities’ potential
liquidity and trading; |
| ● | lack of a market for our securities; |
| ● | use of proceeds not held in
the trust account or available to us from interest income on the trust account balance; or |
| ● | our financial performance. |
The forward-looking statements
contained in this annual report are based on our current expectations and beliefs concerning future developments and their potential effects
on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a number of
risks, uncertainties (some of which are beyond our control) and other assumptions that may cause actual results or performance to be materially
different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited
to, those factors described under the heading “Risk Factors.” Should one or more of these risks or uncertainties materialize,
or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking
statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future
events or otherwise, except as may be required under applicable securities laws. These risks and others described under “Risk Factors”
may not be exhaustive.
By their nature, forward-looking
statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the
future. We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations,
financial condition and liquidity, and developments in the industry in which we operate may differ materially from those made in or suggested
by the forward-looking statements contained in this annual report. In addition, even if our results or operations, financial condition
and liquidity, and developments in the industry in which we operate are consistent with the forward-looking statements contained in this
annual report, those results or developments may not be indicative of results or developments in subsequent periods.
PART I
ITEM 1. BUSINESS
In this Annual Report
on Form 10-K (the “Form 10-K”), references to the “Company” and to “we,” “us,” and “our”
refer to Arogo Capital Acquisition Corp.
Overview
We are a blank check company
incorporated on June 9, 2021 as a Delaware corporation whose business purpose is to effect a merger, capital stock exchange, asset acquisition,
stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business
combination.
Our Sponsor is Singto, LLC, f/k/a Koo Dom Investment, LLC, a Delaware limited liability company. On June 30, 2021, our Sponsor purchased 2,875,000 founder shares for an aggregate purchase
price of $25,000, or approximately $0.009 per share. On October 11, 2021, our sponsor surrendered 287,500 founder shares to the Company
for cancellation.
On December 29, 2021, we
completed our initial public offering (the “Offering” or the “IPO”) of 10,350,000 units (“Units”),
including the issuance of 1,350,000 Units as a result of the underwriter’s full exercise of its over-allotment option. Each Unit
consists of one share of Class A common stock, par value $0.0001 per share (“Class A Common Stock”), and one redeemable warrant
(“Warrant”), each whole Warrant entitling the holder thereof to purchase one share of Class A Common Stock at an exercise
price of $11.50 per share, subject to adjustment, pursuant to the Company’s registration statement on Form S-1 (File Nos. 333-259338).
The Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $103,500,000.
On December 29, 2021, simultaneously
with the consummation of the Offering, the Company completed a private placement of an aggregate of 466,150 units (the “Private
Placement Units”) at a price of $10.00 per Private Placement Unit, generating total gross proceeds of $4,661,500 (the “Private
Placement”). A total of $105,052,500, comprised of the proceeds from the Offering and the proceeds of the Private Placement, net
of the underwriting commissions, discounts, and offering expenses, was deposited in a trust account established for the benefit of the
Company’s public stockholders.
On February 11, 2022, the
Class A Common Stock and Public Warrant included in the Units began separate trading.
Charter Amendments
On March 24, 2023, the Company
held a Special Meeting of Stockholders (the “First Special Meeting”). At the First Special Meeting, the Company’s stockholders
approved the Charter Amendment, which extends the date by which the Company must consummate its initial Business Combination from March
29, 2023 to December 29, 2023, subject to the approval of the Board of Directors of the Company, provided the sponsor or its designees
deposit into the trust account an amount equal to $0.0378 per share for each public share or $191,666, prior to the commencement of each
extension period (the “Extension”). The Company filed the Charter Amendment with the Office of the Secretary of State of Delaware
on March 28, 2023. At the First Special Meeting, the Company’s stockholders approved the Charter Amendment extending the date by
which the Company must consummate the initial Business Combination from March 29, 2023 to December 29, 2023, (or such earlier date as
determined by the Company’s Board of Directors) (the “Extension Amendment Proposal”). Stockholders holding 5,289,280
shares of common stock exercised their right to redeem their shares for cash at an approximate price of $10.33 per share of the funds
in the Trust Account. As a result, approximately $54,675,740 were removed from the Trust Account to pay such holders.
Following the redemption,
the Company’s remaining shares of Class A common stock outstanding were 5,060,720. The Sponsor has continued to make monthly deposits
into the Trust Account of $191,666 for five of the nine monthly extensions, from March 29, 2023 until August 29, 2023.
The Company also made an
amendment to the Company’s investment management trust agreement (the “Trust Agreement”), dated as of December 23, 2021,
by and between the Company and Continental Stock Transfer & Trust Company, allowing the Company to extend the business combination
period from March 29, 2023 to December 29, 2023, and updating certain defined terms in the Trust Agreement (the “First Amendment
to the Trust Agreement”).
On September 21, 2023, the
Company held a Special Meeting of Stockholders (the “Second Special Meeting”). At the Second Special Meeting, the Company’s
stockholders approved the Charter Amendment, which extends the date by which the Company must consummate its initial Business Combination
from December 29, 2023 to December 29, 2024, subject to the approval of the Board of Directors of the Company, provided the sponsor or
its designees deposit into the trust account an amount equal to $40,000, prior to the commencement of each extension period (the “Extension”).
The Company filed the Charter Amendment with the Office of the Secretary of State of Delaware on September 28, 2023. At the Second Special
Meeting, the Company’s stockholders approved the Charter Amendment extending the date by which the Company must consummate the initial
Business Combination from December 29, 2023 to December 29, 2024, (or such earlier date as determined by the Company’s Board of
Directors) (the “Extension Amendment Proposal”). Stockholders holding 3,298,311 shares of common stock exercised their right
to redeem their shares for cash at an approximate price of $10.72 per share of the funds in the Trust Account. As a result, approximately
$35,448,259 were removed from the Trust Account to pay such holders.
Following the redemption,
the Company’s remaining shares of Class A common stock outstanding were 1,762,409. The Sponsor has continued to make monthly deposits
into the Trust Account of $40,000 for the monthly extensions, from September 29, 2023 until April 29, 2024.
The Company also made an
amendment to the Company’s investment management trust agreement (the “Trust Agreement”), dated as of December 23, 2021,
as amended by and between the Company and Continental Stock Transfer & Trust Company, allowing the Company to extend the business
combination period from December 29 2023 to December 29, 2024, and updating certain defined terms in the Trust Agreement (the “Second
Amendment to the Trust Agreement”).
The holders of the Founders
Shares have agreed to waive their liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination
within the Combination Period. However, if the holders of Founder Shares acquire Public Shares in or after the Initial Public Offering,
such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination
within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note
6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such
event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the
Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution
will be less than the Initial Public Offering price per Unit ($10.00).
In order to protect the amounts
held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party for services
rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction
agreement, reduce the amount of funds in the Trust Account to below (i) $10.15 per Public Share or (ii) such lesser amount per Public
Share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.15 per public Share due to reductions
in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, except as to any claims
by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the
Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under
the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to
be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims.
The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by
endeavoring to have all vendors, service providers (except for the Company’s independent registered accounting firm), prospective
target businesses and other entities with which the Company does business, execute agreements with the Company waiving any right, title,
interest or claim of any kind in or to monies held in the Trust Account.
Termination of Proposed Business Combination
On April 25, 2022, the Company
entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among Arogo, Arogo Merger Singto, LLC, f/k/a Koo Dom Investment, LLC, a Delaware
corporation and wholly-owned subsidiary of Arogo (“Merger Sub”), Eon Reality, Inc., a California corporation (“EON”),
Koo Dom Investment, LLC, in its capacity as (“Purchaser Representative”), and EON, in its capacity as (“Seller Representative”).
On October 6, 2022, the parties to the Merger Agreement entered into that certain First Amendment to the Agreement and Plan of Merger
(the “Amendment”). The Business Combination agreement and related agreements are further described in the Company’s
Current Report on Form 8-K filed with the SEC on April 26, 2022, and on October 7, 2022.
On November 7, 2023, the Company
sent EON a termination notice (the “Termination Notice”) that the Company had terminated the Business Combination Agreement
(the “Termination”) and all Ancillary Agreements, pursuant to Section 8.1 (Termination) thereof and as a remedy at law, based
on breaches by EON of certain covenants contained in the Business Combination Agreement.
The Termination Notice does
not constitute a waiver of, and shall not prejudice any of the Company’s rights under the Business Combination Agreement or at law.
The Company reserves all such rights in full to pursue any and all loss of Arogo, Arogo Representative, and the shareholders of the Company
with respect to the Termination.
The foregoing description
of the Business Combination Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of
the text of the Business Combination Agreement, which was previously filed as Exhibit 2.1 to the Current Report on Form 8-K filed with
the SEC on April 26, 2022, and the BCA Amendment, which was previously filed as Exhibit 2.1 to the Current Report on Form 8-K filed with
the SEC on October 6, 2022, which is incorporated by reference herein.
Registration Statement on Form S-4 Declared
Abandoned
The Company filed a Registration
Statement on Form S-4 with the SEC on October 7, 2022, to register the issuance of the Company Common Stock that will be issued at the
consummation of the Business Combination, the warrants exercisable for Company Common Stock that will result from the amendment of the
Company’s public warrants at the consummation of the Business Combination and the Company Common Stock issuable upon exercise of
such warrants. The Company filed an Amendment No. 1 thereto on February 13, 2023. We use the term “Arogo Form S-4” to refer
to the original registration statement as amended by the first amendment and as it may be subsequently further amended. On February 6,
2024, the Securities and Exchange Commission (the “SEC”) declared the Registration Statement as abandoned under the Securities
Act of 1933, as amended.
Business Strategy and Competitive Advantages
While we may pursue an initial
business combination opportunity in any business, industry, sector or geographical location, we intend to focus on industries that complement
our management team’s background and to capitalize on the ability of our management team to identify and acquire a business focusing
on operations or prospective operations in electric vehicles (EV) technology, smart mobility or sustainable transportation and related
business ecosystem in Asia Pacific, primarily South East Asia, where our management team has extensive experience, especially in information
technology, transportation operations, and manufacturing industries.
We believe that acquiring
a leading high-growth technology company or assets in the transportation industry will provide a platform to fund consolidation and fuel
growth for our company. There is no restriction in the geographic location of targets we can pursue, although we intend to initially prioritize
Asia Pacific, especially South East Asia as the geographical focus.
We believe that there is
a large pool of quality initial business combination targets looking for exit opportunities with an increasing number of private equity
(or PE) and venture capital (or VC) activities in the certain regions, which provides us opportunities given what we believe are the limited
exit options for mid-market companies in the region. Also, we believe that the technology and tech enabled industries represent a particularly
attractive deal sourcing environment that will allow us to leverage our team’s skill sets and experience to identify an initial
business combination which can potentially serve as a strong platform for future add-on acquisitions. Our investment thesis is supported
by what we believe are the following trends in our target sectors:
| ● | Strong Core Industry Fundamental: Despite the impact of the
COVID-19 pandemic on global automotive sales, electrification of transportation remains on track. According to a March 2021 article by
Deloitte on deloitte.com, across the globe, regulators and industry players alike recognize the opportunity that the transition to electric
vehicles (EVs) presents for their economies to simultaneously advance their goals for economic growth and sustainable development. Within
Southeast Asia, the benefits of electrification are tangible and wide-ranging. Apart from enabling economies to meet their climate change
commitments, reduce air pollution, and increase energy security, electrification also offers many opportunities along the value chain
for economies with established automotive manufacturing hubs – such as Indonesia and Thailand – to extend their footprint
in EV and battery production, and for economies with less developed automotive manufacturing capabilities to catch up with, or even leapfrog,
industry players in more established automotive manufacturing hubs. Specifically, the shift to EVs is expected to not only contribute
to the overall reduction of carbon emissions, but also create substantial macroeconomic opportunities as automotive players rethink their
conventional internal combustion engine vehicle (ICEV) value chains. |
| ● | Strong Growth in Private Equity: In the first quarter of
2021, global venture funding reached a record of $125 billion, this number is up 94% compared to the same period last year according
to an April 2021 article on crunchbase.com. A total of $188 billion was raised across 452 funds in the first quarter of the year, up
16% and 5% respectively in Q1 2020 according to an April 2021 press release on preqin.com. A May 2021 article by Ernst & Young, on
ey.com, Mega deals increased in Q1 2021, mega-round ($100 million and over) investments accounting for more than 60% of activity, with
183 deals raising $39 billion in Q1 2021. This strong growth should further populate the pipeline of PE owned companies waiting for an
exit. |
| ● | Targeting of Fastest Growing Industries. The main industries
we are targeting are the transportation and technology industries. This is not just a function of our expertise in these fields, but
it is also because these sectors are currently anticipated to be some of the fastest growing industries in the global economy, with the
expectation that the global smart mobility industry will expand at a compounded annual growth rate (CAGR) of approximately 29.33% from
USD 421.32 billion in 2020 to USD 3.3 trillion in 2029 with over 30% coming from Asia Pacific in accordance with the May 2021 report
on researchandmarkets.com. The decrease in the cost of hardware, the evolution of network communication technology, growth in support
infrastructure, high mobile adoption and internet penetration are some of the key drivers for the expansion and growth of the smart mobility
market. Besides, there is a massive opportunity for growth in EV technology. According to an April 2021 article by Market Data Forecast
on marketdataforecast.com, the Asia Pacific electric vehicle market alone is expected to reach USD166.3 billion by 2025 with a CAGR of
29.9% fueled by environmental awareness, government support, growing concerns of rising air pollution and growing demand for vehicles
using clean fuel. The smart mobility market has experienced substantial growth over the last few years and is expected to increase further
over the projected period of 2020-2029 in the areas of connectivity, electrification, automation and shared mobility pursuant to the
May 2021 report on researchandmarkets.com With rising pollution concerns and the need for decarbonization in the areas of sustainable
development, we will also be focusing on businesses with Environment, Social & Governance (ESG) priorities related to sustainable
transportation and its ecosystem. |
| ● | Operator-Led SPACs outperform their Sectors: According to
a September 2020 article by McKinsey & Company on mckinsey.com, SPACs that are led by executives with past C-Suite experience tend
to outperform other SPACs (by about 40%) and their industry peers (by about 10%) after at least 12 months of publicly available trading
data. |
Acquisition Criteria
Consistent with our strategy,
we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses.
We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business
combination with a target business that does not meet these criteria and guidelines.
|
● |
Target Size: Consistent with our investment thesis as described above, we plan to target businesses with total enterprise values ranging from $200.0 million to $2.0 billion in the transportation and technology industries, specifically within the electric vehicles (EV) technologies, smart mobility, or sustainable transportation. |
|
● |
Businesses with Revenue and Earnings Growth Potential. We will seek to acquire one or more businesses that have the potential for significant revenue and earnings growth through a combination of both existing and new product development, increased production capacity, expense reduction and synergistic follow-on acquisitions resulting in increased operating leverage. |
|
● |
Businesses with Potential for Strong Free Cash Flow Generation. We will seek to acquire one or more businesses that have the potential to generate strong, stable and increasing free cash flow. We intend to focus on one or more businesses that have predictable revenue streams and definable low working capital and capital expenditure requirements. We may also seek to prudently leverage this cash flow in order to enhance stockholder value. |
|
● |
Strong Management. We will seek companies with strong management teams already in place. We will spend significant time assessing a company’s leadership and human fabric, and maximizing its efficiency over time. |
| ● | Benefit from Being a
Public Company. We intend to acquire one or more businesses that will benefit from being publicly-traded and
can effectively utilize the broader access to capital and the public profile that are associated with being a publicly traded company. |
| ● | Appropriate Valuations
and Upside Potential. We intend to apply rigorous, criteria-based, disciplined, and valuation-centric metrics. We intend to acquire
a target on terms that we believe provide significant upside potential while seeking to limit risk to our investors. |
These criteria are not intended
to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant,
on these general guidelines as well as other considerations, factors and criteria that from time to time our management may deem relevant.
Initial Business Combination and Satisfaction
of 80% Test
Nasdaq rules require that
we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held
in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at
the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the
determination as to the fair market value of our initial business combination. As of December 31, 2023, the balance of the funds in the
Trust Account was approximately $15,564,675 (excluding $3,622,500 of the cash portion of the deferred underwriting commissions) and 80%
thereof represents approximately $12,451,740.
If our board of directors
is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent
investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such
criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair
market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of
a particular target or if there is a significant amount of uncertainty as to the value of a target’s assets or prospects. Additionally,
pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors.
We anticipate structuring
our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire
100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination
such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to
meet certain objectives of the prior owners of the target business, the target management team or stockholders or for other reasons, but
we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the 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 of 1940, as amended (the “Investment Company Act”). Even if the post-transaction
company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively
own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination
transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the
outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in
the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial
business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination.
If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company,
the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test.
If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of
all of the target businesses and we will treat the target businesses together as our initial business combination for purposes of a tender
offer or for seeking stockholder approval, as applicable.
To the extent we effect our
initial business combination with a company or business that may be financially unstable or in its early stages of development or growth,
we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks
inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors.
In evaluating a prospective
target business, we expect to conduct a thorough due diligence review which will encompass, among other things, meetings with incumbent
management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information
which will be made available to us.
The time required to select
and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process,
are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of
a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses
and will reduce the funds we can use to complete another business combination.
Status as a Public Company
We believe our structure
will make us an attractive business combination partner to target businesses. As a public company, we offer a target business an alternative
to the traditional initial public offering through a merger or other business combination with us. Following an initial business combination,
we believe the target business would have greater access to capital and additional means of creating management incentives that are better
aligned with stockholders’ interests than it would as a private company. A target business can further benefit by augmenting its
profile among potential new customers and vendors and aid in attracting talented employees. In a business combination transaction with
us, the owners of the target business may, for example, exchange their shares of stock in the target business for our shares of Class A
common stock (or shares of a new holding company) or for a combination of our shares of Class A common stock and cash, allowing us
to tailor the consideration to the specific needs of the sellers.
Although there are various
costs and obligations associated with being a public company, we believe target businesses will find this method a more expeditious and
cost-effective method to becoming a public company than the typical initial public offering. The typical initial public offering process
takes a significantly longer period of time than the typical business combination transaction process, and there are significant expenses
in the initial public offering process, including underwriting discounts and commissions, marketing and road show efforts that may not
be present to the same extent in connection with an initial business combination with us.
Furthermore, once a proposed
initial business combination is completed, the target business will have effectively become public, whereas an initial public offering
is always subject to the underwriters’ ability to complete the offering, as well as general market conditions, which could delay
or prevent the offering from occurring or could have negative valuation consequences. Following an initial business combination, we believe
the target business would then have greater access to capital and an additional means of providing management incentives consistent with
stockholders’ interests and the ability to use its shares as currency for acquisitions. Being a public company can offer further
benefits by augmenting a company’s profile among potential new customers and vendors and aid in attracting talented employees.
While we believe that our
structure and our management team’s backgrounds will make us an attractive business partner, some potential target businesses may
view our status as a blank check company, such as our lack of an operating history and our ability to seek stockholder approval of any
proposed initial business combination, negatively.
We are an “emerging
growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to
take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging
growth companies” including, but not limited to, not being required to comply with the independent registered public accounting
firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation
in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive
compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities
less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more
volatile.
In addition, Section 107
of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided
in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging
growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
We intend to take advantage of the benefits of this extended transition period.
We will remain an emerging
growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion
of the IPO, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a
large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million
as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities
during the prior three-year period.
Additionally, we are a “smaller
reporting company” as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain
reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain
a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates
equals or exceeds $250 million as of the end of the prior June 30th, or (2) our annual revenues equaled or exceeded $100
million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the
prior June 30th.
Financial Position
With funds available for
an initial business combination initially in the amount of $79,026, as of December 31, 2023, after payment of $3,622,500 of deferred underwriting
fees, before fees and expenses associated with our initial business combination (other than deferred underwriting fees), we offer a target
business a variety of options such as creating a liquidity event for its owners, providing capital for the potential growth and expansion
of its operations or strengthening its balance sheet by reducing its debt or leverage ratio. Because we are able to complete our initial
business combination using our cash, debt or equity securities, or a combination of the foregoing, we have the flexibility to use the
most efficient combination that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires.
However, we have not taken any steps to secure third party financing and there can be no assurance it will be available to us.
Effecting Our Initial Business Combination
We intend to effectuate our
initial business combination using cash from the proceeds of our initial public offering and the sale of the placement units, the proceeds
of the sale of our shares in connection with our initial business combination (pursuant to backstop agreements we may enter into following
the consummation of the IPO or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners
of the target, or a combination of the foregoing. We may seek to complete our initial business combination with a company or business
that may be financially unstable or in its early stages of development or growth, which would subject us to the numerous risks inherent
in such companies and businesses.
If our initial business combination
is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration
in connection with our initial business combination or used for redemptions of our Class A common stock, we may apply the balance
of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations
of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing our initial business
combination, to fund the purchase of other companies or for working capital.
We may seek to raise additional
funds through a private offering of debt or equity securities in connection with the completion of our initial business combination, and
we may effectuate our initial business combination using the proceeds of such offering rather than using the amounts held in the trust
account. In addition, we intend to target businesses larger than we could acquire with the net proceeds of the IPO and the sale of the
placement units, and may as a result be required to seek additional financing to complete such proposed initial business combination.
Subject to compliance with applicable securities laws, we would expect to complete such financing only simultaneously with the completion
of our initial business combination. In the case of an initial business combination funded with assets other than the trust account assets,
our proxy materials or tender offer documents disclosing the initial business combination would disclose the terms of the financing and,
only if required by applicable law or stock exchange requirements, we would seek stockholder approval of such financing. There are no
prohibitions on our ability to raise funds privately, or through loans in connection with our initial business combination. At this time,
we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale
of securities or otherwise.
Although our management will
assess the risks inherent in a particular target business with which we may combine, we cannot assure you that this assessment will result
in our identifying all risks that a target business may encounter. Furthermore, some of those risks may be outside of our control, meaning
that we can do nothing to control or reduce the chances that those risks will adversely impact a target business.
Sources of Target Businesses
We anticipate that target
business candidates will be brought to our attention from various unaffiliated sources, including investment bankers and investment professionals,
as a result of being solicited by us by calls or mailings. These sources may also introduce us to target businesses in which they think
we may be interested on an unsolicited basis. Our officers and directors, as well as our sponsor and their affiliates, may also bring
to our attention target business candidates that they become aware of through their business contacts as a result of formal or informal
inquiries or discussions they may have, as well as attending trade shows or conventions. In addition, we expect to receive a number of
deal flow opportunities that would not otherwise necessarily be available to us as a result of the business relationships of our officers
and directors and our sponsor and their affiliates. We may engage the services of professional firms or other individuals that specialize
in business acquisitions, in which event we may pay a finder’s fee, consulting fee, advisory fee or other compensation to be determined
in an arm’s length negotiation based on the terms of the transaction. We will engage a finder only to the extent our management
determines that the use of a finder may bring opportunities to us that may not otherwise be available to us or if finders approach us
on an unsolicited basis with a potential transaction that our management determines is in our best interest to pursue. Payment of finder’s
fees is customarily tied to completion of a transaction; in which case any such fee will be paid out of the funds held in the trust account.
In no event, however, will our sponsor or any of our existing officers or directors be paid any finder’s fee, reimbursement, consulting
fee, monies in respect of any payment of a loan or other compensation by the company prior to, or in connection with any services rendered
for any services they render in order to effectuate, the completion of our initial business combination (regardless of the type of transaction
that it is). None of our sponsor, executive officers or directors, or any of their respective affiliates, will be allowed to receive any
compensation, finder’s fees or consulting fees from a prospective business combination target in connection with a contemplated
initial business combination except as set forth herein. We have agreed to pay Singto, LLC, f/k/a Koo Dom Investment, LLC, our sponsor, a total of $10,000
per month for office space, utilities and secretarial and administrative support and to reimburse our sponsor for any out-of-pocket expenses
related to identifying, investigating, and completing an initial business combination. Some of our officers and directors may enter into
employment or consulting agreements with the post-transaction company following our initial business combination. The presence or absence
of any such fees or arrangements will not be used as a criterion in our selection process of an initial business combination candidate.
We are not prohibited from
pursuing an initial business combination with an initial business combination target that is affiliated with our sponsor, officers or
directors or making the initial business combination through a joint venture or other form of shared ownership with our sponsor, officers
or directors. In the event we seek to complete our initial business combination with an initial business combination target that is affiliated
with our sponsor, officers or directors, we, or a committee of independent directors, would obtain an opinion from an independent investment
banking firm or another independent entity that commonly renders valuation opinions that such an initial business combination is fair
to our company from a financial point of view. We are not required to obtain such an opinion in any other context.
If any of our officers or
directors becomes aware of an initial business combination opportunity that falls within the line of business of any entity to which he
or she has pre-existing fiduciary or contractual obligations, he or she may be required to present such business combination opportunity
to such entity prior to presenting such business combination opportunity to us. Our officers and directors may have certain relevant fiduciary
duties or contractual obligations that may take priority over their duties to us.
Selection of a Target Business and Structuring
of our Initial Business Combination
Nasdaq rules require that
we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held
in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at
the time of our signing a definitive agreement in connection with our initial business combination, as was the case with the Business
Combination. The fair market value of our initial business combination will be determined by our board of directors based upon one or
more standards generally accepted by the financial community, such as discounted cash flow valuation, a valuation based on trading multiples
of comparable public businesses or a valuation based on the financial metrics of M&A transactions of comparable businesses. If our
board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an
opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect
to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent
determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced
with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target’s assets
or prospects. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination.
Subject to this requirement, our management will virtually have unrestricted flexibility in identifying and selecting one or more prospective
target businesses, although we will not be permitted to effectuate our initial business combination with another blank check company or
a similar company with nominal operations.
In any case, we will only
complete an initial business combination in which we own or acquire 50% or more of the outstanding voting securities of the target or
otherwise acquire a controlling interest in the target sufficient for it not to be required to register as an investment company under
the Investment Company Act, as was the case with the Business Combination. If we own or acquire less than 100% of the equity interests
or assets of a target business or businesses, the portion of such business or businesses that are owned or acquired by the post-transaction
company is what will be taken into account for purposes of Nasdaq’s 80% fair market value test. There is no basis for investors
in the IPO to evaluate the possible merits or risks of any target business with which we may ultimately complete our initial business
combination.
To the extent we effect our
initial business combination with a company or business that may be financially unstable or in its early stages of development or growth
we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks
inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors.
In evaluating a prospective
business target, we expect to conduct a thorough due diligence review, which may encompass, among other things, meetings with incumbent
management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as well as a review of financial
and other information that will be made available to us.
The time required to select
and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process,
are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of
a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses
and will reduce the funds we can use to complete another business combination.
Lack of Business Diversification
For an indefinite period
of time after the completion of our initial business combination, the prospects for our success may depend entirely on the future performance
of a single business. Unlike other entities that have the resources to complete business combinations with multiple entities in one or
several industries, it is probable that we will not have the resources to diversify our operations and mitigate the risks of being in
a single line of business. In addition, we intend to focus our search for an initial business combination in a single industry. By completing
our initial business combination with only a single entity, our lack of diversification may:
| ● | subject us to negative economic,
competitive and regulatory developments, any or all of which may have a substantial adverse impact on the particular industry in which
we operate after our initial business combination, and |
| ● | cause us to depend on the marketing
and sale of a single product or limited number of products or services. |
Limited Ability to Evaluate the Target’s
Management Team
Although we intend to closely
scrutinize the management of a prospective target business when evaluating the desirability of effecting our initial business combination
with that business, our assessment of the target business’ management may not prove to be correct. In addition, the future management
may not have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future role of members of
our management team, if any, in the target business cannot presently be stated with any certainty. The determination as to whether any
of the members of our management team will remain with the combined company will be made at the time of our initial business combination.
While it is possible that one or more of our directors will remain associated in some capacity with us following our initial business
combination, it is unlikely that any of them will devote their full efforts to our affairs subsequent to our initial business combination.
Moreover, we cannot assure you that members of our management team will have significant experience or knowledge relating to the operations
of the particular target business.
We cannot assure you that
any of our key personnel will remain in senior management or advisory positions with the combined company. The determination as to whether
any of our key personnel will remain with the combined company will be made at the time of our initial business combination.
Following an initial business
combination, we may seek to recruit additional managers to supplement the incumbent management of the target business. We cannot assure
you that we will have the ability to recruit additional managers, or that additional managers will have the requisite skills, knowledge
or experience necessary to enhance the incumbent management.
Stockholders May Not Have the Ability to Approve
Our Initial Business Combination
We may conduct redemptions
without a stockholder vote pursuant to the tender offer rules of the SEC. However, we will seek stockholder approval if it is required
by applicable law or applicable stock exchange listing requirements, or we may decide to seek stockholder approval for business or other
legal reasons. Presented in the table below is a graphic explanation of the types of initial business combinations we may consider and
whether stockholder approval is currently required under Delaware law for each such transaction.
Type of Transaction |
|
Whether
Stockholder
Approval is
Required |
Purchase of assets |
|
No |
Purchase of stock of target not involving a merger with the company |
|
No |
Merger of target into a subsidiary of the company |
|
No |
Merger of the company with a target |
|
Yes |
Under Nasdaq’s listing rules, stockholder
approval would be required for our initial business combination if, for example:
| ● | we issue shares of Class A
common stock that will be equal to or in excess of 20% of the number of shares of our Class A common stock then outstanding (other
than in a public offering); |
| ● | any of our directors, officers
or substantial stockholders (as defined by Nasdaq rules) has a 5% or greater interest (or such persons collectively have a 10% or greater
interest), directly or indirectly, in the target business or assets to be acquired or otherwise and the present or potential issuance
of common stock could result in an increase in outstanding common stock or voting power of 5% or more; or |
| ● | the issuance or potential issuance
of common stock will result in our undergoing a change of control. |
Permitted Purchases of our Securities
In connection with the Business
Combination, or if the Business Combination is not consummated, and we seek stockholder approval of our initial business combination and
we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial
stockholders, directors, officers, advisors or their affiliates may purchase public shares or public warrants in privately negotiated
transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit
on the number of shares our initial stockholders, directors, officers or their affiliates may purchase in such transactions, subject to
compliance with applicable law and Nasdaq rules. However, they have no current commitments, plans or intentions to engage in such transactions
and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any
such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are
prohibited by Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender
offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under
the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules,
the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the
Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will
be used to purchase shares or public warrants in such transactions prior to completion of our initial business combination.
The purpose of any such purchases
of shares could be to (i) vote such shares in favor of the Business Combination or an alternative business combination, in the event Business
Combination is not consummated, and thereby increase the likelihood of obtaining stockholder approval of the business combination or (ii)
to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash
at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of
any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters
submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities
may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases
are made, the public “float” of our shares of Class A common stock or warrants may be reduced and the number of beneficial
holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities
on a national securities exchange.
Our sponsor, officers, directors
and/or their affiliates anticipate that they may identify the stockholders with whom our sponsor, officers, directors or their affiliates
may pursue privately negotiated purchases by either the stockholders contacting us directly or by our receipt of redemption requests submitted
by stockholders following our mailing of proxy materials in connection with our initial business combination. To the extent that our sponsor,
officers, directors or their affiliates enter into a private purchase, they would identify and contact only potential selling stockholders
who have expressed their election to redeem their shares for a pro rata share of the trust account or vote against our initial business
combination, whether or not such stockholder has already submitted a proxy with respect to our initial business combination. Our sponsor,
officers, directors or their affiliates will only purchase public shares if such purchases comply with Regulation M under the Exchange
Act and the other federal securities laws.
Any purchases by our sponsor,
officers, directors and/or their affiliates who are affiliated purchasers under Rule 10b-18 under the Exchange Act will only be made
to the extent such purchases are able to be made in compliance with Rule 10b-18, which is a safe harbor from liability for manipulation
under Section 9(a)(2) and Rule 10b-5 of the Exchange Act. Rule 10b-18 has certain technical requirements that must be complied
with in order for the safe harbor to be available to the purchaser. Our sponsor, officers, directors and/or their affiliates will not
make purchases of common stock if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. We expect that
any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchases are
subject to such reporting requirements.
Redemption Rights for Public Stockholders upon
Completion of our Initial Business Combination
We will provide our public
stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock upon the completion of our initial
business combination at a per-share price, payable in cash, equal to 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 earned on the funds held in the trust account
and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations
described herein. The amount in the trust account is initially anticipated to be approximately $10.15 per public share. The per-share
amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we
will pay to the underwriters. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they
have agreed to waive their redemption rights with respect to any founder shares, placement shares and any public shares held by them in
connection with the completion of our initial business combination.
Manner of Conducting Redemptions
In connection with the initial
business combination, we will provide our public stockholders with the opportunity to redeem all or a portion of their public shares of
Class A common stock upon the completion of the initial business combination in connection with a stockholder meeting called to approve
the initial business combination. In connection with a proposed initial business combination, we will provide our public stockholders
with the opportunity to redeem all or a portion of their Class A Common Stock upon the completion of our initial business combination
either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) by means of a
tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender
offer will be made by us, solely in our 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 require us to seek stockholder approval under the law or stock exchange listing requirement.
Under Nasdaq rules, asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with
our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend
our amended and restated certificate of incorporation would require stockholder approval. If we structure an initial business combination
with a target company in a manner that requires stockholder approval, we will not have discretion as to whether to seek a stockholder
vote to approve the proposed initial business combination. We may conduct redemptions without a stockholder vote pursuant to the tender
offer rules of the SEC unless stockholder approval is required by law or stock exchange listing requirements or we choose to seek stockholder
approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required
to comply with such rules.
If stockholder approval of
the transaction is required by law or stock exchange listing requirement, or we decide to obtain stockholder approval for business or
other legal reasons, we will, pursuant to our amended and restated certificate of incorporation:
| ● | conduct the redemptions in
conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and
not pursuant to the tender offer rules, and |
| ● | file proxy materials with the
SEC. |
The initial business combination
requires the approval of our stockholders under the Merger Agreement and Nasdaq rules. We will distribute proxy materials and, in connection
therewith, provide our public stockholders with the redemption rights described above upon completion of the Business Combination. If
the Business Combination is not consummated, and we seek stockholder approval of an alternative initial business combination, we will
distribute proxy materials and, in connection therewith, provide our public stockholders with the redemption rights described above upon
completion of the initial business combination.
The Business Combination
requires the approval of our stockholders under the Merger Agreement and Nasdaq rules. We will distribute proxy materials and, in connection
therewith, provide our public stockholders with the redemption rights described above upon completion of the Business Combination. If
the Business Combination is not consummated, and we seek stockholder approval of an alternative initial business combination, we will
complete our initial business combination only if a majority of the outstanding shares of common stock present and entitled to vote at
the meeting to approve the initial business combination when a quorum is present are voted in favor of the initial business combination.
A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company
representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting.
Our initial stockholders will count toward this quorum and pursuant to the letter agreement, our sponsor, officers and directors have
agreed to vote any founder shares and placement shares held by them and any public shares acquired during or after the IPO (including
in open market and privately negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of
the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination
once a quorum is obtained. We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior
written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum
and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial
business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the
proposed transaction.
If in connection with a proposed
initial business combination a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other
legal reasons, we will, pursuant to our amended and restated certificate of incorporation:
| ● | conduct the redemptions pursuant
to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and |
| ● | file tender offer documents
with the SEC prior to completing our initial business combination which contain substantially the same financial and other information
about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates
the solicitation of proxies. |
If the initial business combination
is not consummated and upon the public announcement of our initial business combination, we or our sponsor will terminate any plan established
in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market if we elect to redeem our public
shares through a tender offer, to comply with Rule 14e-5 under the Exchange Act.
In the event we conduct redemptions
pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a)
under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer
period. In addition, we will not redeem any public shares unless our net tangible assets will be at least $5,000,001 either immediately
prior to or upon consummation of our initial business combination and after payment of underwriters’ fees and commissions (so that
we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which may
be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered
to purchase, we will withdraw the tender offer and not complete the initial business combination.
Our amended and restated
certificate of incorporation provides that we may not redeem our public shares unless our net tangible assets are at least $5,000,001
either immediately prior to or upon consummation of our initial business combination and after payment of underwriters’ fees and
commissions (so that we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash
requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed initial business
combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target
for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance
with the terms of the proposed initial business combination. In the event the aggregate cash consideration we would be required to pay
for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions
pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete
the initial business combination or redeem any shares, and all shares of Class A common stock submitted for redemption will be returned
to the holders thereof.
Limitation on Redemption upon Completion
of our Initial Business Combination if we Seek Stockholder Approval
Notwithstanding the foregoing,
in connection with the stockholder approval of the Business Combination, or if the Business Combination is not consummated and we seek
stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination
pursuant to the tender offer rules, our amended and restated certificate of incorporation provides that a public stockholder, together
with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group”
(as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an
aggregate of 15% of the shares sold in the IPO, which we refer to as the “Excess Shares.” Such restriction shall also be applicable
to our affiliates. We believe this restriction will discourage stockholders from accumulating large blocks of shares, and subsequent attempts
by such holders to use their ability to exercise their redemption rights against a proposed initial business combination as a means to
force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable
terms. By limiting our stockholders’ ability to redeem no more than 15% of the shares sold in the IPO without our prior consent,
we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial
business combination, particularly in connection with an initial business combination with a target that requires as a closing condition
that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders’ ability to
vote all of their shares (including Excess Shares) for or against our initial business combination.
Tendering Stock Certificates in Connection
with Redemption Rights
We may require our public
stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name,”
to either tender their certificates to our transfer agent up to two business days prior to the vote on the proposal to approve the initial
business combination, or to deliver their shares to the transfer agent electronically using the Depository Trust Company’s DWAC
(Deposit/Withdrawal At Custodian) System, at the holder’s option. The proxy materials that we will furnish to holders of our public
shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such
delivery requirements. Accordingly, a public stockholder would have up to two days prior to the vote on the initial business combination
to tender its shares if it wishes to seek to exercise its redemption rights. Given the relatively short exercise period, it is advisable
for stockholders to use electronic delivery of their public shares.
There is a nominal cost associated
with the above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC System. The transfer
agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not to pass this cost on to the redeeming
holder. However, this fee would be incurred regardless of whether or not we require holders seeking to exercise redemption rights to tender
their shares. The need to deliver shares is a requirement of exercising redemption rights regardless of the timing of when such delivery
must be effectuated.
The foregoing is different
from the procedures used by many special purpose acquisition companies. In order to perfect redemption rights in connection with their
business combinations, many blank check companies would distribute proxy materials for the stockholders’ vote on an initial business
combination, and a holder could simply vote against a proposed initial business combination and check a box on the proxy card indicating
such holder was seeking to exercise his or her redemption rights. After the initial business combination was approved, the company would
contact such stockholder to arrange for him or her to deliver his or her certificate to verify ownership. As a result, the stockholder
then had an “option window” after the completion of the initial business combination during which he or she could monitor
the price of the company’s stock in the market. If the price rose above the redemption price, he or she could sell his or her shares
in the open market before actually delivering his or her shares to the company for cancellation. As a result, the redemption rights, to
which stockholders were aware they needed to commit before the stockholder meeting, would become “option” rights surviving
past the completion of the initial business combination until the redeeming holder delivered its certificate. The requirement for physical
or electronic delivery prior to the meeting ensures that a redeeming holder’s election to redeem is irrevocable once the initial
business combination is approved.
Any request to redeem such
shares, once made, may be withdrawn at any time up to the date of the stockholder meeting. Furthermore, if a holder of a public share
delivered its certificate in connection with an election of redemption rights and subsequently decides prior to the applicable date not
to elect to exercise such rights, such holder may simply request that the transfer agent return the certificate (physically or electronically).
It is anticipated that the funds to be distributed to holders of our public shares electing to redeem their shares will be distributed
promptly after the completion of our initial business combination.
If the Business Combination
or an alternative initial business combination is not approved or completed for any reason, then our public stockholders who elected to
exercise their redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account.
In such case, we will promptly return any certificates delivered by public holders who elected to redeem their shares.
If the Business Combination
is not consummated, we may continue to try to complete an initial business combination with a different target until 15 months from the
closing of the IPO (or up to 21 months if we extend the period of time to consummate a business combination or as extended by the Company’s
stockholders in accordance with our amended and restated certificate of incorporation).
Redemption of Public Shares and Liquidation
if no Initial Business Combination
Our amended and restated
certificate of incorporation provides that in the event that the Company has not consummated an initial Business Combination by December
29, 2024, provided that (i) the Sponsor (or its affiliates or permitted designees) will deposit into the Trust Account $40,000 for each
such one-month extension until December 29, 2024 unless the closing of the Company’s initial business combination shall have occurred
(the “Extension Payment”) in exchange for a non-interest bearing, unsecured promissory note payable upon consummation of a
business combination and (ii) the procedures relating to any such extension, as set forth in the Trust Agreement, shall have been complied
with. If we are unable to complete our initial business combination by December 29, 2024, we will: (i) cease all operations except
for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the
public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest
earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay
dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’
rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors,
dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to our obligations under Delaware law to provide
for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions
with respect to our warrants, which will expire worthless if we fail to complete our initial business combination by December 29, 2024.
Our sponsor, officers and
directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from
the trust account with respect to any founder shares and placement shares held by them if we fail to complete our initial business combination
by December 29, 2024. However, if our sponsor, officers or directors acquire public shares in or after the IPO, they will be entitled
to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination.
Our sponsor, officers and
directors have entered into a letter agreement with us, that they will not propose any amendment to our amended and restated certificate
of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial
business combination by December 29, 2024 or (ii) with respect to any other provision relating to stockholders’ rights or pre-initial
business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common
stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the
trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes divided
by the number of then outstanding public shares. However, we may not redeem our public shares unless our net tangible assets are at least
$5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters’
fees and commissions (so that we are not subject to the SEC’s “penny stock” rules). If this optional redemption right
is exercised with respect to an excessive number of public shares such that we cannot satisfy the net tangible asset requirement (described
above), we would not proceed with the amendment or the related redemption of our public shares at such time. However, if our sponsor,
officers, or directors acquire public shares in or after the IPO, they will be entitled to liquidating distributions from the trust account
with respect to such public shares if we fail to complete our initial business combination by December 29, 2024.
We expect that all costs
and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be funded from amounts remaining
out of the approximately $870,000 of proceeds initially held outside the trust account, although we cannot assure you that there will
be sufficient funds for such purpose. We will depend on sufficient interest being earned on the proceeds held in the trust account
to pay any tax obligations we may owe. However, if those funds are not sufficient to cover the costs and expenses associated with implementing
our plan of dissolution, to the extent that there is any interest accrued in the trust account not required to pay taxes, we may request
the trustee to release to us an additional amount of up to $100,000 of such accrued interest to pay those costs and expenses.
If we were to expend all
of the net proceeds of the IPO and the sale of the placement units, other than the proceeds deposited in the trust account, and without
taking into account interest, if any, earned on the trust account, the per-share redemption amount received by stockholders upon our dissolution
would be approximately $10.15. The proceeds deposited in the trust account could, however, become subject to the claims of our creditors
which would have higher priority than the claims of our public stockholders. We cannot assure you that the actual per-share redemption
amount received by stockholders will not be substantially less than $10.15. Under Section 281(b) of the DGCL, our plan of dissolution
must provide for all claims against us to be paid in full or make provision for payments to be made in full, as applicable, if there are
sufficient assets. These claims must be paid or provided for before we make any distribution of our remaining assets to our stockholders.
While we intend to pay such amounts, if any, we cannot assure you that we will have funds sufficient to pay or provide for all creditors’
claims.
Although we will seek to
have all vendors, service providers, prospective target businesses or other entities with which we do business execute agreements with
us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public
stockholders, there is no guarantee that they will execute such agreements or even if they execute such agreements that they would be
prevented from bringing claims against the trust account including but not limited to fraudulent inducement, breach of fiduciary responsibility
or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain an advantage with
respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement
waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to
it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party’s
engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may engage a third
party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed
by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management
is unable to find a service provider willing to execute a waiver. Adeptus, our independent registered public accounting firm, and the
underwriters of the offering, will not execute agreements with us waiving such claims to the monies held in the trust account.
In addition, there is no
guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations,
contracts or agreements with us and will not seek recourse against the trust account for any reason. Our sponsor has agreed that it will
be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target
business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement,
reduce the amount of funds in the trust account to below the lesser of (i) $10.15 per public share and (ii) the actual amount per
public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.15 per share due to reductions
in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective
target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable)
nor will it apply to any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities
under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently
verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor’s only assets
are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our
officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target
businesses.
In the event that the proceeds
in the trust account are reduced below (i) $10.15 per public share or (ii) such lesser amount per public share held in the trust
account as of the date of the liquidation of the trust account, due to reductions in value of the trust assets, in each case net of the
amount of interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its indemnification obligations
or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take
legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent directors
would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent
directors in exercising their business judgment may choose not to do so if, for example, the cost of such legal action is deemed by the
independent directors to be too high relative to the amount recoverable or if the independent directors determine that a favorable outcome
is not likely. We have not asked our sponsor to reserve for such indemnification obligations and we cannot assure you that our sponsor
would be able to satisfy those obligations. Accordingly, we cannot assure you that due to claims of creditors the actual value of the
per-share redemption price will not be less than $10.15 per public share.
We will seek to reduce the
possibility that our sponsor will have to indemnify the trust account due to claims of creditors by endeavoring to have all vendors,
service providers, prospective target businesses or other entities with which we do business execute agreements with us waiving any right,
title, interest or claim of any kind in or to monies held in the trust account. Our sponsor will also not be liable as to any claims
under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act. We will
have access to up to approximately $870,000 from the proceeds of the IPO and the sale of the placement units with which to pay any such
potential claims (including costs and expenses incurred in connection with our liquidation, currently estimated to be no more than approximately
$100,000). In the event that we liquidate, and it is subsequently determined that the reserve for claims and liabilities is insufficient,
stockholders who received funds from our trust account could be liable for claims made by creditors. In the event that our offering expenses
exceed our estimate of $427,750, we may fund such excess with funds from the funds not to be held in the trust account. In such case,
the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. Conversely, in the event
that the offering expenses are less than our estimate of $427,750, the amount of funds we intend to be held outside the trust account
would increase by a corresponding amount.
Under the DGCL, stockholders
may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution.
The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event
we do not complete our initial business combination by December 29, 2024, we may be considered a liquidating distribution under Delaware
law. If the corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable
provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the
corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before
any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited
to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability
of the stockholder would be barred after the third anniversary of the dissolution.
Furthermore, if the pro
rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do
not complete our initial business combination by December 29, 2024, is not considered a liquidating distribution under Delaware law and
such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring
or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations
for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of
a liquidating distribution. If we are unable to complete our initial business combination by December 29, 2024, we will: (i) cease
all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days
thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust
account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up
to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will
completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions,
if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval
of our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above
to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Accordingly, it
is our intention to redeem our public shares as soon as reasonably possible following December 29, 2025 and, therefore, we do not intend
to comply with those procedures. As such, our stockholders could potentially be liable for any claims to the extent of distributions
received by them (but no more) and any liability of our stockholders may extend well beyond the third anniversary of such date.
Because we will not be complying
with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will
provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the subsequent
10 years. However, because we are a blank check company, rather than an operating company, and our operations will be limited to
searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment
bankers, etc.) or prospective target businesses. As described above, pursuant to the obligation contained in our underwriting agreement,
we will seek to have all vendors, service providers, prospective target businesses or other entities with which we do business execute
agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account. As a result
of this obligation, the claims that could be made against us are significantly limited and the likelihood that any claim that would result
in any liability extending to the trust account is remote. Further, our sponsor may be liable only to the extent necessary to ensure
that the amounts in the trust account are not reduced below (i) $10.15 per public share or (ii) such lesser amount per public share
held in the trust account as of the date of the liquidation of the trust account, due to reductions in value of the trust assets, in
each case net of the amount of interest withdrawn to pay taxes and will not be liable as to any claims under our indemnity of the underwriters
of the IPO against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver is deemed
to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims.
If we file a bankruptcy
petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the trust account could
be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with
priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, we cannot assure you we
will be able to return $10.15 per share to our public stockholders. Additionally, if we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable
debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a
result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. Furthermore, our board of directors
may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, thereby exposing itself and
our company to claims of punitive damages, by paying public stockholders from the trust account prior to addressing the claims of creditors.
We cannot assure you that claims will not be brought against us for these reasons.
Our public stockholders
will be entitled to receive funds from the trust account only upon the earlier to occur of: (i) the completion of our initial business
combination, (ii) the redemption of any public shares properly tendered in connection with a stockholder vote to amend any provisions
of our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption
in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public
shares if we do not complete our initial business combination by December 29, 2024 or (B) with respect to any other provision relating
to stockholders’ rights or pre-initial business combination activity, and (iii) the redemption of all of our public shares
if we are unable to complete our business combination by December 29, 2024, subject to applicable law. In no other circumstances will
a stockholder have any right or interest of any kind to or in the trust account. In the event we seek stockholder approval in connection
with our initial business combination, a stockholder’s voting in connection with the initial business combination alone will not
result in a stockholder’s redeeming its shares to us for an applicable pro rata share of the trust account. Such stockholder must
have also exercised its redemption rights as described above. These provisions of our amended and restated certificate of incorporation,
like all provisions of our amended and restated certificate of incorporation, may be amended with a stockholder vote.
Competition
In identifying, evaluating
and selecting a target business for our initial business combination, we may encounter intense competition from other entities having
a business objective similar to ours, including other blank check companies, private equity groups and leveraged buyout funds, and operating
businesses seeking strategic business combinations. Many of these entities are well established and have extensive experience identifying
and effecting business combinations directly or through affiliates. Moreover, many of these competitors possess greater financial, technical,
human and other resources than we do. Our ability to acquire larger target businesses will be limited by our available financial resources.
This inherent limitation gives others an advantage in pursuing the initial business combination of a target business. Furthermore, our
obligation to pay cash in connection with our public stockholders who exercise their redemption rights may reduce the resources available
to us for our initial business combination and our outstanding warrants, and the future dilution they potentially represent, may not
be viewed favorably by certain target businesses. Either of these factors may place us at a competitive disadvantage in successfully
negotiating an initial business combination.
Facilities
Our executive offices are
located at 848 Brickell Avenue, Penthouse 5, Miami, FL 33131and our telephone number is (786) 442-1482.
We have agreed to pay Singto, LLC, f/k/a Koo Dom Investment, LLC, our sponsor, a total of $10,000 per month for office space, utilities and secretarial and administrative support.
We consider our current office space adequate for our current operations.
Employees
We currently have three
officers. These individuals are not obligated to devote any specific number of hours to our matters but they intend to devote as much
of their time as they deem necessary, in the exercise of their respective business judgement, to our affairs until we have completed
our initial business combination. The amount of time they will devote in any time period will vary based on whether a target business
has been selected for our initial business combination and the stage of the initial business combination process we are in. We do not
intend to have any full-time employees prior to the completion of our initial business combination. We do not have an employment agreement
with any member of our management team.
Periodic Reporting and Financial Information
We will register our units,
Class A common stock and warrants under the Exchange Act and have reporting obligations, including the requirement that we file
annual, quarterly and current reports with the SEC. In accordance with the requirements of the Exchange Act, our annual reports will
contain financial statements audited and reported on by our independent registered public accountants.
We will provide stockholders
with audited financial statements of the prospective target business as part of the tender offer materials or proxy solicitation materials
sent to stockholders to assist them in assessing the target business. In all likelihood, these financial statements will need to be prepared
in accordance with, or reconciled to, GAAP, or IFRS, depending on the circumstances, and the historical financial statements may be required
to be audited in accordance with the standards of the PCAOB. These financial statement requirements may limit the pool of potential targets
we may conduct an initial business combination with because some targets may be unable to provide such statements in time for us to disclose
such statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time frame.
We cannot assure you that any particular target business identified by us as a potential business combination candidate will have financial
statements prepared in accordance with GAAP or that the potential target business will be able to prepare its financial statements in
accordance with the requirements outlined above. To the extent that these requirements cannot be met, we may not be able to acquire the
proposed target business. While this may limit the pool of potential business combination candidates, we do not believe that this limitation
will be material.
We will be required to evaluate
our internal control procedures for the fiscal year ending December 31, 2023 as required by the Sarbanes-Oxley Act. Only in the event
we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth company, will we be
required to have our internal control procedures audited. A target company may not be in compliance with the provisions of the Sarbanes-Oxley
Act regarding adequacy of their internal controls. The development of the internal controls of any such entity to achieve compliance
with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such business combination. We have filed a Registration
Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we are subject
to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our
reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination.
We are an “emerging
growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to
take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging
growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404
of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements,
and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any
golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a
less active trading market for our securities and the prices of our securities may be more volatile.
In addition, Section 107
of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided
in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging
growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
We intend to take advantage of the benefits of this extended transition period.
We will remain an emerging
growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion
of the IPO, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be
a large accelerated filer, which means the market value of our shares of Class A common stock that are held by non-affiliates exceeds
$700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible
debt during the prior three-year period. References herein to “emerging growth company” will have the meaning associated
with it in the JOBS Act.
Additionally, we are a “smaller
reporting company” as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain
reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain
a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates
equals or exceeds $250 million as of the end of that year’s second fiscal quarter, or (2) our annual revenues equaled or exceeded
$100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as
of the end of that year’s second fiscal quarter.
ITEM 1A. RISK FACTORS
As a smaller reporting company,
we are not required to include risk factors in this Report. However, below is a partial list of material risks, uncertainties and other
factors that could have a material effect on the Company and its operations:
| ● | our ability to realize anticipated
benefits of the business combination, and unanticipated expenses or delays in connection with the business combination; |
| ● | if we seek stockholder approval
of our initial business combination, our initial stockholders and members of our management team have agreed to vote in favor of such
initial business combination, regardless of how our public stockholders vote; |
| ● | past performance by our sponsor
and our management team including their affiliates and including the businesses referred to herein, may not be indicative of future performance
of an investment in us or in the future performance of any business that we may acquire. |
| ● | our management may not be able
to maintain control of a target business after our initial business combination. Upon the loss of control of a target business, new management
may not possess the skills, qualifications or abilities necessary to profitably operate such business. |
| ● | we may not be able to complete
our initial business combination in the prescribed time frame; |
| ● | your only opportunity to affect
the investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares
from us for cash; |
| ● | we may not be successful in
retaining or recruiting required officers, key employees or directors following our initial business combination; |
| ● | our officers and directors
may have difficulties allocating their time between our Company and other businesses and may potentially have conflicts of interest with
our business or in approving our initial business combination. We are dependent upon our executive officers and directors and their loss
could adversely affect our ability to operate; |
| ● | we may not be able to obtain
additional financing to complete our initial business combination or reduce the number of shareholders requesting redemption. The ability
of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the
most desirable business combination or optimize our capital structure; |
| ● | we may issue our shares to
investors in connection with our initial business combination at a price that is less than the prevailing market price of our shares
at that time; |
| ● | Our sponsor paid an aggregate
of $25,000, or approximately $0.009 per founder share, and, accordingly, you will experience immediate and substantial dilution from
the purchase of the shares of our Class A common stock; |
| ● | Since our sponsor paid only
approximately $0.009 per share for the founder shares, our officers and directors could potentially make a substantial profit even if
we acquire a target business that subsequently declines in value; |
| ● | you may not be given the opportunity
to choose the initial business target or to vote on the initial business combination; |
| ● | Subsequent to the completion
of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges
that could have a significant negative effect on our financial condition, results of operations and our share price, which could cause
you to lose some or all of your investment; |
| ● | trust account funds may not
be protected against third party claims or bankruptcy; |
|
● |
an active market for our public securities’ may not develop and
you will have limited liquidity and trading; |
| ● | the availability to us of funds
from interest income on the trust account balance may be insufficient to operate our business prior to the business combination; and |
| ● | our financial performance following
a business combination with an entity may be negatively affected by their lack an established record of revenue, cash flows and experienced
management. |
| ● | Changes in laws or regulations, or a failure to comply with
any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial business combination
and results of operations. |
| ● | Unstable market and economic conditions and adverse developments with respect to financial
institutions and associated liquidity risk may have serious adverse consequences on our business, financial condition and stock
price. |
| ● | A new 1% U.S. federal excise tax could be imposed on us in
connection with future redemptions by us of the Public Shares. |
For the complete list of
risks relating to our operations, see the section titled “Risk Factors” contained in our Registration Statement filed with
the SEC on February 13, 2023 and on November 23, 2022 and our Form 10-Q filed with the SEC on November 13, 2023.
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 1C. CYBERSECURITY
We believe cybersecurity
is critical to advancing our business securely. We face a multitude of cybersecurity threats, and may experience, cyber incidents in
the normal course of business. Such cybersecurity threats could have a material adverse effect on our business, financial condition,
operations, results of operations, performance, cash flows or reputation. Our service providers (including the transfer agent), and other
business contacts may face similar cybersecurity threats, and a cybersecurity incident impacting these persons or entities could materially
adversely affect our operations, performance and results of operations.
These cybersecurity
threats and related risks make it imperative that we expend resources on cybersecurity. The Board and/or our Audit Committee oversee
our cybersecurity risk exposures and the steps taken by management to identify, monitor and mitigate cybersecurity risks to align
our risk exposure with our strategic objectives. With respect to such cybersecurity risk oversight, our Board and/or our Audit
Committee receive periodic reports and/or updates from management on the primary cybersecurity risks facing us and the measures we
are taking to mitigate such risks. In addition to such reports and updates, our Board and/or our Audit Committee receive updates
from management as to changes to our cybersecurity risk profile or certain newly identified risks. In the event of an incident, we
intend to follow our incident response plan, which outlines the steps to be followed from incident identification, mitigation,
recovery and notification to legal counsel, senior leadership and the Board or Audit Committee, as appropriate.
While cybersecurity incidents
have not had a material adverse effect on our business, financial condition, results of operations, or cash flows, we may not be successful
in preventing or mitigating a cybersecurity incident that could have a material adverse effect on us.
ITEM 2. PROPERTY
We currently maintain our
principal executive offices at 848 Brickell Avenue, Penthouse 5, Miami, FL 33131, United States. The cost for this space is included
in the $10,000 per-month fee we pay to an affiliate of our Sponsor for office space, utilities, secretarial and administrative support.
We consider our current office space, combined with the other office space otherwise available to our executive officers, adequate for
our current operations.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED
SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Our Units, Class A Common
Stock and Public Warrants are listed on the Nasdaq Global Market (“Nasdaq”) under the symbols “AOGOU,” “AOGO,”
and “AOGOW,” respectively. Out units commenced public trading on December 27, 2021, and our public shares and Public Warrants
commenced separate public trading on February 11, 2022.
As of December 31, 2023, there
were no holder of record of our Class A Common Stock and no holder of record of our warrants.
We have not paid any cash
dividends on our Common Stock to date and do not intend to pay cash dividends prior to the completion of a business combination. The
payment of cash dividends in the future will be contingent upon our revenues and earnings, if any, capital requirements, and general
financial condition subsequent to completion of a business combination. Further, if we incur any indebtedness in connection with our
initial business combination, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection
therewith. The payment of any dividends subsequent to a business combination will be within the discretion of our then board of directors.
It is the present intention of our board of directors to retain all earnings, if any, for use in our business operations and, accordingly,
our board does not anticipate declaring any dividends in the foreseeable future.
| (d) | Securities Authorized for
Issuance Under Equity Compensation Plans. |
None.
|
(e) |
Recent Sales of Unregistered Securities |
There were no unregistered securities to report
which have not been previously included in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K.
| (f) | Use of Proceeds from the
Initial Public Offering |
On December 29, 2021, we
completed our initial public offering (the “Offering”) of 10,350,000 units (“Units”), including the issuance
of 1,350,000 Units as a result of the underwriter’s full exercise of its over-allotment option. Each Unit consists of one share
of Class A common stock, par value $0.0001 per share (“Class A Common Stock”), and one redeemable warrant (“Warrant”),
each whole Warrant entitling the holder thereof to purchase one share of Class A Common Stock at an exercise price of $11.50 per share,
subject to adjustment, pursuant to the Company’s registration statement on Form S-1 (File Nos. 333-259338). The Units were sold
at an offering price of $10.00 per Unit, generating gross proceeds of $103,500,000.
On December 29, 2021, simultaneously
with the consummation of the Offering, the Company completed a private placement of an aggregate of 466,150 units (the “Private
Placement Units”) at a price of $10.00 per Private Placement Unit, generating total gross proceeds of $4,661,500 (the “Private
Placement”). A total of $105,052,500, comprised of the proceeds from the Offering and the proceeds of the Private Placement, net
of the underwriting commissions, discounts, and offering expenses, was deposited in a trust account established for the benefit of the
Company’s public stockholders.
On February 11, 2022, the
Class A Common Stock and Public Warrants included in the Units began separate trading.
Transaction costs amounted
to $6,524,539 consisting of $1,811,250 of underwriting fees, $3,622,500 of deferred underwriting fees and $1,090,789 of other offering
costs. As of December 31, 2023, approximately $79,026 of cash, was held outside of the trust account established in connection with our
initial public offering and is available for working capital purposes.
On December 31, 2023, substantially
all of the assets held in the Trust Account were held in mutual funds.
No payments for our expenses
were made in the offering described above directly or indirectly to (i) any of our directors, officers or their associates, (ii) any
person(s) owning 10% or more of any class of our equity securities or (iii) any of our affiliates, except in connection with the repayment
of outstanding loans and pursuant to the administrative support agreement disclosed herein which we entered into with our sponsor. There
has been no material change in the planned use of proceeds from our offering as described in our final prospectus filed with the SEC
pursuant to Rule 424(b) related to the Initial Public Offering.
ITEM 6. Reserved.
ITEM 7. MANAGEMENT’S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
References to the “Company,”
“us,” “our” or “we” refer to Arogo Capital Acquisition Corp. The following discussion and analysis
of our financial condition and results of operations should be read in conjunction with our audited financial statements and related
notes included herein.
Cautionary Note Regarding Forward-Looking
Statements
All statements other than
statements of historical fact included in this Report including, without limitation, statements under this “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” regarding our financial position, business strategy and
the plans and objectives of management for future operations, are forward- looking statements. When used in this Report, words such as
“anticipate,” “believe,” “estimate,” “expect,” “intend” and similar expressions,
as they relate to us or our management, identify forward-looking statements. Such forward-looking statements are based on the beliefs
of management, as well as assumptions made by, and information currently available to, the Company’s management. Actual results
could differ materially from those contemplated by the forward- looking statements as a result of certain factors detailed in our filings
with the SEC. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are qualified
in their entirety by this paragraph.
The following discussion
and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and the
notes thereto contained elsewhere in this 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 blank check company
incorporated in June 2021 as a Delaware corporation whose business purpose is to effect a merger, capital stock exchange, asset acquisition,
stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business
combination.
Our Sponsor is Singto, LLC, f/k/a Koo Dom Investment, LLC, a Delaware limited liability company. On June 30, 2021, our Sponsor purchased 2,875,000 founder shares for an aggregate purchase
price of $25,000, or approximately $0.009 per share. On October 11, 2021, our sponsor surrendered 287,500 founder shares to the Company
for cancellation.
On December 29, 2021, we
completed our initial public offering (the “Offering”) of 10,350,000 units (“Units”), including the issuance
of 1,350,000 Units as a result of the underwriter’s full exercise of its over-allotment option. Each Unit consists of one share
of Class A common stock, par value $0.0001 per share (“Class A Common Stock”), and one redeemable warrant (“Warrant”),
each whole Warrant entitling the holder thereof to purchase one share of Class A Common Stock at an exercise price of $11.50 per share,
subject to adjustment, pursuant to the Company’s registration statement on Form S-1 (File Nos. 333-259338). The Units were sold
at an offering price of $10.00 per Unit, generating gross proceeds of $103,500,000.
On December 29, 2021, simultaneously
with the consummation of the Offering, the Company completed a private placement of an aggregate of 466,150 units (the “Private
Placement Units”) at a price of $10.00 per Private Placement Unit, generating total gross proceeds of $4,661,500 (the “Private
Placement”). A total of $105,052,500, comprised of the proceeds from the Offering and the proceeds of the Private Placement, net
of the underwriting commissions, discounts, and offering expenses, was deposited in a trust account established for the benefit of the
Company’s public stockholders.
On February 11, 2022, the
Class A Common Stock and Public Warrant included in the Units began separate trading.
Charter Amendments
On March 24, 2023, the Company
held a Special Meeting of Stockholders (the “First Special Meeting”). At the First Special Meeting, the Company’s stockholders
approved the Charter Amendment, which extends the date by which the Company must consummate its initial Business Combination from March
29, 2023 to December 29, 2023, subject to the approval of the Board of Directors of the Company, provided the sponsor or its designees
deposit into the trust account an amount equal to $0.0378 per share for each public share or $191,666, prior to the commencement of each
extension period (the “Extension”). The Company filed the Charter Amendment with the Office of the Secretary of State of
Delaware on March 28, 2023. At the First Special Meeting, the Company’s stockholders approved the Charter Amendment extending the
date by which the Company must consummate the initial Business Combination from March 29, 2023 to December 29, 2023, (or such earlier
date as determined by the Company’s Board of Directors) (the “Extension Amendment Proposal”). Stockholders holding
5,289,280 shares of common stock exercised their right to redeem their shares for cash at an approximate price of $10.33 per share of
the funds in the Trust Account. As a result, approximately $54,675,740 were removed from the Trust Account to pay such holders.
Following the redemption,
the Company’s remaining shares of Class A common stock outstanding were 5,060,720. The Sponsor has continued to make monthly deposits
into the Trust Account of $191,666 for five of the nine monthly extensions, from March 29, 2023 until August 29, 2023.
The Company also made an
amendment to the Company’s investment management trust agreement (the “Trust Agreement”), dated as of December 23,
2021, by and between the Company and Continental Stock Transfer & Trust Company, allowing the Company to extend the business combination
period from March 29, 2023 to December 29, 2023, and updating certain defined terms in the Trust Agreement (the “First Amendment
to the Trust Agreement”).
On September 21, 2023, the
Company held a Special Meeting of Stockholders (the “Second Special Meeting”). At the Second Special Meeting, the Company’s
stockholders approved the Charter Amendment, which extends the date by which the Company must consummate its initial Business Combination
from December 29, 2023 to December 29, 2024, subject to the approval of the Board of Directors of the Company, provided the sponsor or
its designees deposit into the trust account an amount equal to $40,000, prior to the commencement of each extension period (the “Extension”).
The Company filed the Charter Amendment with the Office of the Secretary of State of Delaware on September 28, 2023. At the Second Special
Meeting, the Company’s stockholders approved the Charter Amendment extending the date by which the Company must consummate the
initial Business Combination from December 29, 2023 to December 29, 2024, (or such earlier date as determined by the Company’s
Board of Directors) (the “Extension Amendment Proposal”). Stockholders holding 3,298,311 shares of common stock exercised
their right to redeem their shares for cash at an approximate price of $10.72 per share of the funds in the Trust Account. As a result,
approximately $35,448,259 were removed from the Trust Account to pay such holders.
Following the redemption,
the Company’s remaining shares of Class A common stock outstanding were 1,762,409. The Sponsor has continued to make monthly deposits
into the Trust Account of $40,000 for the monthly extensions, from September 29, 2023 until April 29, 2024.
The Company also made an
amendment to the Company’s investment management trust agreement (the “Trust Agreement”), dated as of December 23,
2021, as amended by and between the Company and Continental Stock Transfer & Trust Company, allowing the Company to extend the business
combination period from December 29 2023 to December 29, 2024, and updating certain defined terms in the Trust Agreement (the “Second
Amendment to the Trust Agreement”).
The holders of the Founders
Shares have agreed to waive their liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination
within the Combination Period. However, if the holders of Founder Shares acquire Public Shares in or after the Initial Public Offering,
such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination
within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note
6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in
such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption
of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for
distribution will be less than the Initial Public Offering price per Unit ($10.00).
In order to protect the
amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party
for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering
into a transaction agreement, reduce the amount of funds in the Trust Account to below (i) $10.15 per Public Share or (ii) such lesser
amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.15 per public
Share due to reductions in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes,
except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as
to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including
liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed
waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such
third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to
claims of creditors by endeavoring to have all vendors, service providers (except for the Company’s independent registered accounting
firm), prospective target businesses and other entities with which the Company does business, execute agreements with the Company waiving
any right, title, interest or claim of any kind in or to monies held in the Trust Account.
Termination of Proposed Business Combination
On April 25, 2022, the Company
entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among Arogo, Arogo Merger Sub, Inc., a Delaware
corporation and wholly-owned subsidiary of Arogo (“Merger Sub”), Eon Reality, Inc., a California corporation (“EON”),
Singto, LLC, f/k/a Koo Dom Investment, LLC, in its capacity as (“Purchaser Representative”), and EON, in its capacity as (“Seller Representative”).
On October 6, 2022, the parties to the Merger Agreement entered into that certain First Amendment to the Agreement and Plan of Merger
(the “Amendment”). The Business Combination agreement and related agreements are further described in the Company’s
Current Report on Form 8-K filed with the SEC on April 26, 2022, and on October 7, 2022.
On November 7, 2023, the
Company sent EON a termination notice (the “Termination Notice”) that the Company had terminated the Business Combination
Agreement (the “Termination”) and all Ancillary Agreements, pursuant to Section 8.1 (Termination) thereof and as a remedy
at law, based on breaches by EON of certain covenants contained in the Business Combination Agreement.
The Termination Notice does
not constitute a waiver of, and shall not prejudice any of the Company’s rights under the Business Combination Agreement or at
law. The Company reserves all such rights in full to pursue any and all loss of Arogo, Arogo Representative, and the shareholders of
the Company with respect to the Termination.
The foregoing description
of the Business Combination Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of
the text of the Business Combination Agreement, which was previously filed as Exhibit 2.1 to the Current Report on Form 8-K filed with
the SEC on April 26, 2022, and the BCA Amendment, which was previously filed as Exhibit 2.1 to the Current Report on Form 8-K filed with
the SEC on October 6, 2022, which is incorporated by reference herein.
Registration Statement on Form S-4 Declared
Abandoned
The Company filed a Registration
Statement on Form S-4 with the SEC on October 7, 2022, to register the issuance of the Company Common Stock that will be issued at the
consummation of the Business Combination, the warrants exercisable for Company Common Stock that will result from the amendment of the
Company’s public warrants at the consummation of the Business Combination and the Company Common Stock issuable upon exercise of
such warrants. The Company filed an Amendment No. 1 thereto on February 13, 2023. We use the term “Arogo Form S-4” to refer
to the original registration statement as amended by the first amendment and as it may be subsequently further amended. On February 6,
2024, the Securities and Exchange Commission (the “SEC”) declared the Registration Statement as abandoned under the Securities
Act of 1933, as amended.
Results of Operations
As of December 31, 2023,
we have neither engaged in any operations nor generated any revenues. All activity for the period from June 9, 2021 (inception) through
December 31, 2023, relates to our formation and the initial public offering. We will not generate any operating revenues until after
the completion of our initial business combination, at the earliest. We will generate non-operating income in the form of interest income
on cash and cash equivalents from the proceeds derived from the initial public offering.
For the year ended December
31, 2023, we had a net income of $1,461,815, which consists of formation and operating costs $1,162,659, franchise tax $200,000, income
tax $299,623 interest earned in operating account $43, and interest earned on marketable securities held in the Trust Account of $3,124,054.
For the year ended December 31, 2022, we had a net loss of $726,312 which consist of formation and operating costs of $1,462,908, franchise
tax $200,050, interest earned in operating account $18 and interest earned on marketable securities hold in the trust account of $1,102,427.
The difference between the two years operation because of the increase on interest rate and expenses related to business combination.
Liquidity and Capital Resources
On December 29, 2021, we
consummated our initial public offering of 10,350,000 units at a price of $10.00 per unit, at $10.00 per unit, generating gross proceeds
of $103.5 million. Simultaneously with the closing of our initial public offering, we consummated the private placement of an aggregate
of 466,150 Units to Singto, LLC, f/k/a Koo Dom Investment, LLC, at a price of $10.00 per Private Placement Unit, generating total gross proceeds of $4,661,500.
For the year ended December
31, 2023, cash used in operating activities was $1,218,545. Net income of $1,461,815 was affected by unrealized gain on marketable securities
held in the Trust Account of $3,124,054, interest earned in operating account of $43. Changes in operating assets and liabilities used
$432,048 of cash for operating activities. For the year ended December 31, 2022, cash used in operating activities was $1,130,079. Net
loss of $726,312 was affected by unrealized gain on marketable securities held in the Trust Account of $1,102,427 and interest earned
in operating account of $18. Changes in operating assets and liabilities used $698,678 of cash for operating activities.
As of December 31, 2023,
we had investments of $19,187,175 held in the Trust Accounts. We intend to use substantially all of the funds held in the Trust Accounts,
including any amounts representing interest earned on the Trust Accounts (less taxes paid and deferred underwriting commissions) to complete
our initial business combination. We may withdraw interest to pay taxes. During the period ended December 31, 2023, we withdrew $1,064,539
interest earned on the Trust Accounts. To the extent that our capital stock or debt is used, in whole or in part, as consideration to
complete our initial business combination, the remaining proceeds held in the Trust Accounts 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 December 31, 2023,
we had cash of $79,026 outside of the Trust Accounts. We intend to use the funds held outside the Trust Accounts primarily to evaluate
target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar
locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of
prospective target businesses, and structure, negotiate and complete our initial business combination.
In order to fund working
capital deficiencies or finance transaction costs in connection with our initial 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
our initial business combination, we would repay such loaned amounts. In the event that our initial business combination does not close,
we may use a portion of the working capital held outside the Trust Accounts to repay such loaned amounts but no proceeds from our Trust
Accounts would be used for such repayment. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit
at the option of the lender, upon consummation of our initial business combination. The units would be identical to the placement units.
If our estimate of the costs
of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination are less than the actual
amount necessary to do so, we may have insufficient funds available to operate our business prior to our Business Combination. Moreover,
we may need to obtain additional financing either to complete our Business Combination or because we become obligated to redeem a significant
number of our Public Shares upon consummation of our Business Combination, in which case we may issue additional securities or incur
debt in connection with such Business Combination.
In connection with our assessment
of going concern considerations in accordance with FASB ASU 2014-15, “Disclosures of Uncertainties about an Entity’s ability
to Continue as a Going Concern,” we have determined that if we are unable to raise additional funds to alleviate liquidity needs
as well as complete a Business Combination by December 29, 2024 then we will cease all operations except for the purpose of liquidating.
The liquidity condition and the date for mandatory liquidation and subsequent dissolution raises substantial doubt about our ability
to continue as a going concern. We plan to consummate a Business Combination prior to the mandatory liquidation date. No adjustments
have been made to the carrying amounts of assets or liabilities should we be required to liquidate after December 29, 2024.
Extension Payment Deposit
Following the redemption,
the Company’s remaining shares of Class A common stock outstanding were 1,762,409. The Sponsor has continued to make monthly deposits
into the Trust Account of $40,000 for the monthly extensions, from September 29, 2023 until April 29, 2024.
Critical Accounting Policies
The preparation of audited
financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent
assets and liabilities at the date of the audited financial statements, and income and expenses during the periods reported. Actual results
could materially differ from those estimates. As of December 31, 2023, the Company has identified the following critical accounting policies:
Use of Estimates
The preparation of financial statements in conformity
with GAAP requires 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 financial statements and the reported amounts of revenues and 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 financial statements, which management considered in formulating its estimate, could change in the near
term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Net Income (Loss)
Per Common Stock
Net income (loss) per share
is computed by dividing net income (loss) by the weighted average number of common stock shares outstanding for the period. The calculation
of diluted income (loss) per share does not consider the effect of the warrants issued in connection with the Initial Public Offering
and warrants issued as components of the Private Placement Units (the “Placement Warrants”) since the exercise of the warrants
are contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive.
Net loss per share, basic
and diluted, for Class A and Class B non-redeemable common stock is calculated by dividing the net loss, adjusted for income attributable
to Class A redeemable common stock shares, by the weighted average number of Class A and Class B non-redeemable common stock shares outstanding
for the period. Non-redeemable Class A and Class B common stock shares includes the Founder Shares and non-redeemable common stock shares
as these shares do not have any redemption features and do not participate in the income earned on the Trust Account. On December 31,
2023 and December 31, 2022, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised
or converted into shares of common stock 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 periods presented.
Class A common
stock subject to possible redemption
The Company accounts for
its Class A common stock subject to possible redemption in accordance with the guidance enumerated in ASC 480 “Distinguishing
Liabilities from Equity”. Common stock subject to mandatory redemption are classified as a liability instrument and are measured
at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that are either within the
control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control)
is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s
Class A common stock features certain redemption rights that are considered by the Company to be outside of the Company’s
control and subject to the occurrence of uncertain future events. Accordingly, on December 31, 2023 and 2022, there are 1,762,409 and
10,350,000 shares of Class A common stock subject to possible redemption in the amount of $19,187,175 and $105,052,500 are presented
as temporary equity, outside of the stockholders’ deficit section of the Company’s balance sheet.
Recent Accounting
Standards
In August 2020, the FASB
issued ASU No. 2020-06, “Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in
Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”
(“ASU 2020-06 “), which simplifies accounting for convertible instruments by removing major separation models required under
current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative
scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for fiscal
years beginning after December 15, 2023, including interim periods within those fiscal years, with early adoption permitted. The Company
is currently assessing the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows.
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a
material effect on the Company’s financial statements.
Off-Balance Sheet Arrangements
As of December 31, 2023,
we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K.
Contractual Obligations
We do not have any long-term
debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay an affiliate of
our Sponsor a monthly fee of $10,000 for office space, utilities, out of pocket expenses, and secretarial and administrative support.
We began incurring these fees on December 29, 2021 and will continue to incur these fees monthly until the earlier of the completion
of the business combination or our liquidation.
The underwriters are entitled
to a deferred fee of $3,622,500. The deferred fee will become payable to the underwriters from the amounts held in the trust account
solely in the event that we complete a business combination, subject to the terms of the underwriting agreement.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK
Not required for smaller reporting companies.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA
This information appears
following Item 15 of this Report and is included herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
None.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Disclosure controls and
procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed,
summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated
and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar
functions, as appropriate to allow timely decisions regarding required disclosure.
Under the supervision and
with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer (together, the “Certifying
Officers”), we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures
as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on the foregoing, our Certifying Officers concluded that our
disclosure controls and procedures were effective as of the end of the period covered by this Report.
We do not expect that our
disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter
how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls
and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints,
and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures,
no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies
and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the
likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential
future conditions.
Management’s Report on Internal Controls
Over Financial Reporting
As required by SEC rules
and regulations implementing Section 404 of the Sarbanes-Oxley Act, our management is responsible for establishing and maintaining adequate
internal control over financial reporting. Our internal control over financial reporting is designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of our consolidated financial statements for external reporting
purposes in accordance with GAAP. Our internal control over financial reporting includes those policies and procedures that:
| (1) | pertain to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company, |
| (2) | provide reasonable assurance
that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with GAAP, and that
our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and |
| (3) | provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect
on the consolidated financial statements. |
Because of its inherent
limitations, internal control over financial reporting may not prevent or detect errors or misstatements in our consolidated financial
statements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree or compliance with the policies or procedures may deteriorate. Management assessed
the effectiveness of our internal control over financial reporting on December 31, 2023. In making these assessments, management used
the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated
Framework (2013). Based on our assessments and those criteria, management determined
that we did not maintain effective internal control over financial reporting as of December 31, 2023, due to the material weakness in
our internal controls due to inadequate segregation of duties within account processes due to limited personnel and insufficient written
policies and procedures for accounting, IT, and financial reporting and record keeping.
Management intends to implement remediation steps
to improve our internal controls due to inadequate segregation of duties within account processes due to limited personnel and insufficient
written policies and procedures for accounting, IT, and financial reporting and record keeping. We plan to further improve this process
by enhancing the size and composition of our board upon the closing of the business and to identify third-party professionals with whom
to consult regarding complex accounting applications and consideration of additional staff with the requisite experience and training
to supplement existing accounting professionals and implemented additional layers of reviews in the financial close process.
This Annual Report on Form
10-K does not include an attestation report of our independent registered public accounting firm due to our status as an emerging growth
company under the JOBS Act.
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
year ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over
financial reporting.
ITEM 9B. OTHER INFORMATION
None.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS
THAT PREVENT INSPECTIONS
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS
OF THE REGISTRANT
Officers, Directors and Director Nominees
Our officers and directors
are as follows:
Name |
|
Age |
|
Position |
Mr. Suradech Taweesaengsakulthai |
|
57 |
|
Chief Executive Officer and Director |
Mr. Chee Han Wen |
|
47 |
|
Chief Strategy Officer |
Mr. Suthee Chivaphongse |
|
57 |
|
Chief Financial Officer |
H.R.H. Tunku Naquiyuddin ibni Tuanku Ja’afar |
|
76 |
|
Director |
Mr. Somnuek Anakwat |
|
65 |
|
Director |
Mr. J. Gerald Combs |
|
74 |
|
Director |
Suradech Taweesaengsakulthai,
our Chief Executive Officer and Director, has over 25 years of experience in the logistics and transportation industries in Southeast
Asia. Since 1993, he has served as the President and CEO of Cho Thavee Public Company Limited, which manufactures, sells, and services
commercial vehicles with a focus on system integration for logistics systems. It is listed on the Stock Exchange of Thailand (“SET”)
as CHO.BK. Under Mr. Taweesaengsakulthai leadership, the company has received the Thailand Sustainability Investment 2019 award by SET.
The award is representative of the company’s commitment and excellence in Environmental, Social, & Corporate Governance (ESG)
and sustainable development. Since 1993, he has also served as Managing Director of Khonkaen Cho Thavee Co., Ltd, an engineering project
management service company. Since 2005, he has also served as the President and CEO of Cho Thavee Thermo-Tech Co., Ltd., which designs,
manufactures, assembles, and installs light-weight fiberglass fresh box for trucks. Since January 2015, he has served as the Co-Founder
and Chairman of Khon Kaen City Development (KKTT) Co., Ltd., which is focused on smart city development. Mr. Taweesaengsakulthai plays
a vital role in the Electric Automotive Industry Promotion Committee of Khon Kaen Province. Mr. Taweesaengsakulthai received a Diploma
in Automotive Engineering from Yomiuri Rikosem College in Japan in March, 1990. He also holds an Associate Degree in Business Administration
from Sanno University in Japan in March, 1992. He has also received an Honorary Doctorate Degree of Engineering in Mechanical Engineering
from the Rajamangala University of Technology Isan (RMUTI) in Thailand in August, 2018. Mr. Taweesaengsakulthai’s extensive experience
and knowledge in logistics and sustainable development makes him a valuable addition to our management team and board of directors.
Chee Han Wen, our
Chief Strategy Officer, is a technology entrepreneur and pioneer in enterprise cloud computing technology in Southeast Asia. He possesses
an in-depth knowledge in digital transformation. His current area of focus includes smart city business ecosystems, and sustainable development
in Thailand in accordance with the United Nations Sustainable Development Goals (SDG) initiative. Since August, 2019, he has served as
the Executive Vice President & Chief Business Development Officer of Cho Thavee PCL, a public company listed in Thailand’s
Stock Exchange as CHO.BK. He plays a key role in international business development by establishing new business opportunities and partnerships
in the area of transportation technology. Prior to that, from September, 1999 to March, 2017 he served as the Managing Director of RapidCloud
International PLC, a regional enterprise cloud computing company, where he serviced customers ranging from small to medium enterprises
to multi-national corporations as well as government agencies. Mr. Chee currently serves on the board of directors of the Malaysian-Thai
Chamber of Commerce (MTCC) for the term 2020 to 2022. MTCC’s main objective is to promote and develop economic relations and cooperation
between Malaysia and Thailand. Mr. Chee heads MTCC’s Digital and Innovation Committee to support their international technology
initiative. Mr. Chee graduated with a Bachelor of Science degree in Physics with honors from the National University of Malaysia in 1998.
He has also received a Certificate in Digital Transformation: Platform Strategies for Success from MIT Sloan School of Management in
2019. As a result of his professional and academic experiences, Mr. Chee brings extensive breadth, depth and expertise in the digital
transformation services combined with sustainable development goals to our management team.
Suthee Chivaphongse,
FCCA, AMA our Chief Financial Officer, has over 30 years of experience in international finance and business operations in diverse organizations
and industries including conducting audits and managing budgets in the oil and gas, manufacturing, and property development sectors.
Since January 2021, Mr. Chivaphongse has served as the Finance Director of EDS Global Group Co., Ltd., a professional disinfection and
decontamination services company. He has developed and implemented workplace policies for accounting and compliance and played a vital
role in the company’s fund-raising strategy. Prior to that, from February 2019 through December 2020, Mr. Chivaphongse served as
the Chief Operating Officer of Life and Living Co Ltd., a real estate development company. During this time, Mr. Chivaphongse facilitated
the company’s corporate and financial strategies to improve the company’s production efficiency, cash cycle, profit margin,
and overall market share. Before joining the property development industry, Mr. Chivaphongse worked in various roles for Halliburton
Energy Services, Inc., the second largest oil & gas services company in the world and the largest national oil company in Thailand.
He served as their Global Account Manager from September 2017 to February 2019 and their real estate manager, wherein he managed their
Real Estate Department covering Southeast Asia, Japan, South Korea, and Bangladesh from July 2014 through August 2017. He has extensive
experience in finance and administration for projects in Indochina and Bangladesh. He facilitated business development and created growth
in the company’s account market share; further, he oversaw the internal control and compliance. Mr. Chivaphongse also has experience
in the manufacturing sector. Prior to that, from April 2009 through June 2013, he served as an Administration and Finance Director for
Pandora Production Co., Ltd., one of the largest jewelry manufacturing enterprises in Thailand. He played a major part in the successful
IPO of the Pandora Group Co. in the US Stock Exchange. Additionally, he was part of Pandora’s Global CFO Group, which is responsible
for creating and implementing global finance strategies and policies. Mr. Chivaphongse worked in Sylvestor Groves & Co, a UK accounting
firm for more than eight years and in 2001 he was awarded Fellowship by the UK Association of Chartered Certified Accountants. In July
2021, he became an honorable member of the Australian Institute of Certified Management Accountants. In 1984, he received his Diploma
in Business Studies from Saint John’s Trinity College, Bangkok. We believe that Mr. Chivaphongse’s experience in evaluating
financial and strategic options and the operations of companies in diverse industries make him a valuable member of our management team.
H.R.H. Tunku Naquiyuddin
ibni Tuanku Ja’afar, our Director is a keen environmentalist and a conscientious businessman, who has contributed to the business
fraternity through his appointment as founding Chairman of the Federation of Public Listed Companies Berhad. In this position, he has
led several initiatives to bridge bilateral business boundaries through the Malaysia-France Economic and Trade Association for eight
(8) years and facilitated Asia-Pacific co-operation through the Canada-ASEAN Centre. The Minister of Finance nominated him to serve on
the Committee of the Kuala Lumpur Stock Exchange from 1989 to 1994. Since 2007, he has served as the Chairman of Techna-X Berhad, which
provides intelligent digital ecosystem and energy storage solutions. Since 2008, H.R.H. Tunku Naquiyuddin has played a key role on the
boards of Ann Joo Resources Berhad and Olympia Industries Berhad, and held directorships in non-listed public companies, namely ORIX
Leasing Malaysia Berhad, Syarikat Pendidikan Staffield Berhad, and Asia Plantation Capital Berhad. Prior to that, he served as a Diplomat
for five years and served as a Second Secretary in Paris, France from 1972 to 1975. He has served as a Committee Member of the World
Wide Fund for Nature (Malaysia) and held the position of a Council Member of the Business Council for Sustainable Development in Geneva.
H.R.H. Tunku Naquiyuddin holds a Bachelor of Science in Economics degree with honors from the University of Wales, Aberystwyth, United
Kingdom. We intend to draw upon H.R.H. Tunku Naquiyuddin’s comprehensive experience on multiple boards, his network of contacts,
and his deep understanding of intelligent digital ecosystem and sustainable development business initiatives.
Somnuek Anakwat,
our Director has served as an advisor to the Bangkok Expressway Public Company Limited (BECL) ever since 1995. He has played an integral
role in the construction of Udon Ratthaya Expressway. He was instrumental in the installation of Easy Pass on the 2nd Stage Expressway,
which helped alleviate the traffic congestion in Bangkok and its vicinity. Since 2015, Mr. Anakwat has advised the Project Division of
Bangkok Expressway and Metro Public Company Limited (BEM) – a public transportation company formed by the merger of Bangkok Expressway
Public Company Limited (“BECL”) and Bangkok Metro Public Company Limited (“BMCL”) in December 2015. Additionally,
from 2018 to 2019, he served as a senior advisor for the Office of Permanent Secretary for Defence. Mr. Anakwat received his Bachelor
of Electrical Engineering degree from The Citadel, the Military College of South Carolina in 1982. He also received a Masters in Electrical
Engineering degree from the University of South Carolina in 1984. We believe Mr. Anakwat is well-qualified to serve as a member of our
board of directors due to his extensive experience advising construction and transportation industries and overcoming formidable challenges
to provide sustainable results.
J. Gerald Combs,
our Director brings over 30 years of investment management, manufacturing, and real estate experience in various roles, including his
current role as CEO of CASH International Asset Management Ltd. Prior to that Mr. Combs served as the Chairman and CEO of both publicly
traded and privately held companies, ranging from start-ups to established enterprises, most recently focused on quantitative asset management
and incubation. He has overseen corporate relationships with the SEC as well as the exchanges (including NASDAQ and NYSE) upon which
the public shares were traded. In addition, Mr. Combs facilitated the corporate interaction with the analyst community and individual
market makers, and has deep experience negotiating with investment and commercial banks for both equity and debt financing. In October
1975, he began his business career at the investment banking firm of Salomon Brothers, where his responsibilities included mergers and
acquisitions, initial public offerings, secondary offerings, and private placements. Since February 2010, Mr. Combs has also served as
the CEO of Jerald Capital Corp., an investment banking firm. Mr. Combs received his Bachelor of Arts degree from Northwestern University
in June 1972. He received his Juris Doctorate with honors degree from St. Louis University in June 1975. Mr. Combs background in private
placements, and mergers and acquisitions provides us with a strong transactional network.
In addition, we have engaged
the services of ARC Group Ltd to provide financial advisory services in connection with the IPO.
Past performance of our
management team is not a guarantee (i) of success with respect to any business combination we may consummate or (ii) that we
will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical performance
record of our management team or any affiliates as indicative of our future performance. Additionally, in the course of their respective
careers, members of our management team have been involved in businesses and deals that were unsuccessful. Our officers and directors
have little to no experience with blank check companies or special purpose acquisition companies. In addition, our executive officers
and directors may have conflicts of interest with other entities to which they owe fiduciary duties or contractual obligations with respect
to initial business combination opportunities.
Director Independence
Nasdaq listing standards
require that a majority of our board of directors be independent. An “independent director” is defined generally as a person
other than an officer or employee of the company or its subsidiaries or any other individual having a relationship which in the opinion
of the company’s board of directors, would interfere with the director’s exercise of independent judgment in carrying out
the responsibilities of a director. Our board of directors have determined that all of our directors, other than Suradech Taweesaengsakulthai
are “independent directors” as defined in the Nasdaq listing standards and applicable SEC rules. Our independent directors
will have regularly scheduled meetings at which only independent directors are present.
Committees of the Board of Directors
Our board of directors have
two standing committees: an audit committee and a compensation committee. Subject to phase-in rules and a limited exception, Nasdaq rules
and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors,
and Nasdaq rules require that the compensation committee of a listed company be comprised solely of independent directors.
Audit Committee
We have adopted an audit
committee of the board of directors. Mr. Somnuek Anakwat, Mr. J. Gerald Combs, and H.R.H. Tunku Naquiyuddin ibni Tuanku Ja’afar
serve as members of our audit committee, and Mr. J. Gerald Combs chairs the audit committee. Under the Nasdaq listing standards and applicable
SEC rules, we are required to have at least three members of the audit committee, all of whom must be independent. Each of Mr. Somnuek
Anakwat, Mr. J. Gerald Combs, and H.R.H. Tunku Naquiyuddin ibni Tuanku Ja’afar meet the independent director standard under Nasdaq
listing standards and under Rule 10-A-3(b)(1) of the Exchange Act.
Each member of the audit
committee is financially literate, and our board of directors has determined that Mr. J. Gerald Combs qualifies as an “audit committee
financial expert” as defined in applicable SEC rules.
We have adopted an audit
committee charter, which details the principal functions of the audit committee, including:
| ● | the appointment, compensation,
retention, replacement, and oversight of the work of the independent registered public accounting firm engaged by us; |
|
● |
pre-approving all audit and permitted non-audit services to be provided
by the independent registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; |
|
● |
setting clear hiring policies for employees or former employees of
the independent registered public accounting firm, including but not limited to, as required by applicable laws and regulations; |
|
● |
setting clear policies for audit partner rotation in compliance with
applicable laws and regulations; |
|
● |
obtaining and reviewing a report, at least annually, from the independent
registered public accounting firm describing (i) the independent registered public accounting firm’s internal quality-control
procedures, (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm,
or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or
more independent audits carried out by the firm and any steps taken to deal with such issues and (iii) all relationships between
the independent registered public accounting firm and us to assess the independent registered public accounting firm’s independence; |
|
● |
reviewing and approving any related party transaction required to be
disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and |
|
● |
reviewing with management, the independent registered public accounting
firm, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators
or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements
or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards
Board, the SEC or other regulatory authorities. |
Compensation Committee
We have established a compensation
committee of the board of directors. H.R.H. Tunku Naquiyuddin ibni Tuanku Ja’afar and Mr. Somnuek Anakwat serve as members of our
compensation committee. Under the Nasdaq listing standards and applicable SEC rules, we are required to have at least two members of
the compensation committee, all of whom must be independent. Each of H.R.H. Tunku Naquiyuddin ibni Tuanku Ja’afar, and Mr. Somnuek
Anakwat are independent, and Mr. Anakwat chairs the compensation committee.
We have adopted a compensation
committee charter, which details the principal functions of the compensation committee, including:
|
● |
reviewing and approving on an annual basis the corporate goals and
objectives relevant to our Chief Executive Officer’s compensation, if any is paid by us, evaluating our Chief Executive Officer’s
performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive
Officer based on such evaluation; |
|
● |
reviewing and approving on an annual basis the compensation, if any
is paid by us, of all of our other officers; |
|
● |
reviewing on an annual basis our executive compensation policies and
plans; |
|
● |
implementing and administering our incentive compensation equity-based
remuneration plans; |
|
● |
assisting management in complying with our proxy statement and annual
report disclosure requirements; |
|
● |
approving all special perquisites, special cash payments and other
special compensation and benefit arrangements for our officers and employees; |
|
● |
if required, producing a report on executive compensation to be included
in our annual proxy statement; and |
|
● |
reviewing, evaluating and recommending changes, if appropriate, to
the remuneration for directors. |
Notwithstanding the foregoing,
as indicated above, other than the payment to Singto, LLC, f/k/a Koo Dom Investment, LLC, our sponsor, of $10,000 per month, for up to 21 months, for the
office space, utilities, and secretarial and administrative support, no compensation of any kind, including finders, consulting or other
similar fees, will be paid to any of our existing stockholders, officers, directors or any of their respective affiliates, prior to,
or for any services they render in order to effectuate the consummation of an initial business combination. Accordingly, it is likely
that prior to the consummation of an initial business combination, the compensation committee will only be responsible for the review
and recommendation of any compensation arrangements to be entered into in connection with such initial business combination.
The charter also provides
that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel
or other adviser and will be directly responsible for the appointment, compensation and oversight of the work of any such adviser. However,
before engaging or receiving advice from a compensation consultant, external legal counsel or any other adviser, the compensation committee
will consider the independence of each such adviser, including the factors required by Nasdaq and the SEC.
Compensation Committee Interlocks and Insider
Participation
None of our executive officers
currently serves, and in the past year has not served, as a member of the compensation committee of any entity that has one or more executive
officers serving on our board of directors.
Corporate Governance and Nominating Committee
We do not have a standing
corporate governance and nominating committee; however, the Board has adopted a resolution in accordance with Rule 5605 of the Nasdaq
rules, wherein a majority of the independent directors may recommend a director nominee for selection by the board of directors. The
board of directors believes that the independent directors can satisfactorily carry out the responsibility of properly selecting or approving
director nominees without the formation of a standing nominating committee. Our independent directors will participate in the consideration
and recommendation of director nominees. In accordance with Rule 5605 of the Nasdaq rules, all such directors are independent. As there
is no standing nominating committee, we do not have a nominating committee charter in place. We have not formally established any specific,
minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluating
nominees for director, the board of directors considers educational background, diversity of professional experience, knowledge of our
business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our stockholders.
Code of Ethics
We have adopted a Code of
Ethics applicable to our directors, officers and employees. We have filed a copy of our Code of Ethics and our audit and compensation
committee charters with the SEC and copies are available on our website. You are able to review these documents by accessing our public
filings at the SEC’s web site at www.sec.gov. In addition, a copy of the Code of Ethics will be provided without charge upon request
from us. We intend to disclose any amendments to or waivers of certain provisions of our Code of Ethics in a Current Report on Form 8-K.
Conflicts of Interest
Subject to pre-existing
fiduciary or contractual duties as described below, our officers and directors have agreed to present any business opportunities presented
to them in their capacity as a director or officer of our company to us. Certain of our officers and directors presently have fiduciary
or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business
combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is
suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary
or contractual obligations to present such opportunity to such entity. We believe, however, that the fiduciary duties or contractual
obligations of our officers or directors will not materially affect our ability to complete our initial business combination.
The conflicts described
above may not be resolved in our favor.
In general, officers and
directors of a corporation incorporated under the laws of the State of Delaware are required to present business opportunities to a corporation
if:
| ● | the corporation could financially
undertake the opportunity; |
| ● | the opportunity is within the
corporation’s line of business; and |
| ● | it would not be fair to our
company and its stockholders for the opportunity not to be brought to the attention of the corporation. |
Accordingly, as a result
of multiple business affiliations, our officers and directors may have similar legal obligations relating to presenting business opportunities
meeting the above-listed criteria to multiple entities. Furthermore, our amended and restated certificate of incorporation will provide
that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered
to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually
permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to
refer that opportunity to us without violating another legal obligation.
Below is a table summarizing
the entities to which our executive officers, directors and director nominees currently have fiduciary duties or contractual obligations:
Individual(1) |
|
Entity(2) |
|
Entity’s
Business |
|
Affiliation |
Mr. Suradech Taweesaengsakulthai |
|
Cho Thavee Public Company Limited
Cho Thavee Thermo-Tech Co. Ltd.
Khonkaen Cho Thavee Co., Ltd
Khon Kaen City Development (KKTT) Co., Ltd
|
|
System Integration for Logistics Company
Manufacturing Company
Engineering Project Management Services Company
Development Initiative |
|
President and CEO
President and CEO
Managing Director
Co-Founder and Chairman |
Chee Han Wen |
|
Cho Thavee Public Company Limited |
|
System Integration for Logistics Company |
|
Executive Vice President & Chief Business Development Officer |
H.R.H. Tunku Naquiyuddin ibni Tuanku Ja’afar |
|
Techna-X Berhad
Ann Joo Resources Berhad
Olympia Industries Berhad
ORIX Leasing Malaysia Berhad
Syarikat Pendidilan Staffield Berhad
Asia Plantation Capital Berhad |
|
Energy Storage Solutions Company
Investment Company
Investment Company
Equipment Leasing Company
Residential Education Company
Commercial Plantation Company |
|
Chairman
Non-Executive Director
Chairman and Independent Non-Executive Director
Director
Director
Director |
Mr. Somnuek Anakwat |
|
N/A |
|
N/A |
|
N/A |
J. Gerald Combs |
|
CASH International Asset Management Ltd. |
|
Asset Management Company |
|
Chief Executive Officer |
Suthee Chivaphongse |
|
EDS Global Group CP. Ltd |
|
Decontamination Services Company |
|
Finance Director |
(1) | Each person has a fiduciary
duty with respect to the listed entities next to their respective names. |
(2) | Each of the entities listed
in this table has priority and preference relative to our company with respect to the performance by each individual listed in this table
of his obligations and the presentation by each such individual of business opportunities. |
Accordingly, if any of the
above executive officers, directors or director nominees becomes aware of a business combination opportunity which is suitable for any
of the above entities to which he or she has current fiduciary or contractual obligations, he or she will honor his or her fiduciary
or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity
rejects the opportunity.
We are not prohibited from
pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek
to complete our initial business combination with such a company, we, or a committee of independent directors, would obtain an opinion
from an independent investment banking firm or another independent entity that commonly renders valuation opinions, that such an initial
business combination is fair to our company from a financial point of view.
In the event that we submit
our initial business combination to our public stockholders for a vote, pursuant to the letter agreement, our sponsor, officers and directors
have agreed to vote any founder shares or placement shares held by them and any public shares purchased during or after the offering
(including in open market and privately negotiated transactions) in favor of our initial business combination.
Limitation on Liability and Indemnification
of Officers and Directors
Our amended and restated
certificate of incorporation provides that our officers and directors will be indemnified by us to the fullest extent authorized by Delaware
law, as it now exists or may in the future be amended. In addition, our amended and restated certificate of incorporation provides that
our directors will not be personally liable for monetary damages to us or our stockholders for breaches of their fiduciary duty as directors,
unless they violated their duty of loyalty to us or our stockholders, acted in bad faith, knowingly or intentionally violated the law,
authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived an improper personal benefit
from their actions as directors.
We have entered into agreements
with our officers and directors to provide contractual indemnification in addition to the indemnification provided for in our amended
and restated certificate of incorporation. Our bylaws also permit us to secure insurance on behalf of any officer, director or employee
for any liability arising out of his or her actions, regardless of whether Delaware law would permit such indemnification.
These provisions may discourage
stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty. These provisions also may have the effect
of reducing the likelihood of derivative litigation against officers and directors, even though such an action, if successful, might
otherwise benefit us and our stockholders. Furthermore, a stockholder’s investment may be adversely affected to the extent we pay
the costs of settlement and damage awards against officers and directors pursuant to these indemnification provisions.
We believe that these provisions,
the directors’ and officers’ liability insurance and the indemnity agreements are necessary to attract and retain talented
and experienced officers and directors.
ITEM 11. EXECUTIVE COMPENSATION
Executive Compensation
No executive officer has
received any cash compensation for services rendered to us. Commencing on December 29, 2021 through the acquisition of a target business
or our liquidation of the trust account, we will pay our Sponsor, $10,000 per month for office space, utilities, secretarial and administrative
support.
After our initial business
combination, members of our management team who remain with us may be paid consulting, management or other fees from the combined company
with any and all amounts being fully disclosed to shareholders, to the extent then known, in the proxy solicitation materials furnished
to our shareholders. However, the amount of such compensation may not be known at the time of the shareholder meeting held to consider
an initial business combination, as it will be up to the directors of the post-combination business to determine executive and director
compensation. In this event, such compensation will be publicly disclosed at the time of its determination in a Current Report on Form
8-K or a periodic report, as required by the SEC.
Since our formation, we
have not granted any stock options or stock appreciation rights or any other awards under long-term incentive plans to any of our executive
officers or directors.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS
The following table sets
forth information regarding the beneficial ownership of the Company’s common stock as of the record date based on information obtained
from the persons named below, with respect to the beneficial ownership of shares of the Company’s common stock, by:
|
● |
each person known by us to be the beneficial owner of more than 5%
of our outstanding shares of common stock; |
|
● |
each of our executive officers and directors that beneficially owns
shares of common stock; and |
|
● |
all our officers and directors as a group. |
As of the record date, there
were 1,762,409 shares of Class A common stock and 2,587,500 shares of Class B common stock issued and outstanding. Unless otherwise
indicated, all persons named in the table have sole voting and investment power with respect to all shares of common stock beneficially
owned by them.
| |
Class A Common Stock | | |
Class B Common Stock(2) | | |
Approximate | |
Name and Address of Beneficial Owner(1) | |
Number of Shares Beneficially Owned | | |
Approximate Percentage of Class | | |
Number of Shares Beneficially Owned | | |
Approximate Percentage of Class | | |
Percentage of Outstanding Common Stock | |
Singto, LLC, f/k/a Koo Dom Investment, LLC | |
| 466,150 | | |
| 26.45 | % | |
| 2,482,500 | | |
| 95.94 | % | |
| 67.78 | % |
Suradech Taweesaengsakulthai | |
| — | | |
| — | | |
| 30,000 | | |
| 1.15 | % | |
| * | |
Chee Han Wen | |
| — | | |
| — | | |
| 30,000 | | |
| 1.15 | % | |
| * | |
H.R.H. Tunku Naquiyuddin ibni Tunku Ja’afar | |
| — | | |
| — | | |
| 25,000 | | |
| * | | |
| * | |
Somnuek Anakwat | |
| — | | |
| — | | |
| 6,000 | | |
| * | | |
| * | |
J. Gerald Combs | |
| — | | |
| — | | |
| 8,000 | | |
| * | | |
| * | |
Suthee Chivaphongse | |
| — | | |
| — | | |
| 6,000 | | |
| * | | |
| * | |
All directors and executive officers as a group (6 individuals) | |
| 0 | | |
| 0 | % | |
| 105,000 | | |
| 4.01 | % | |
| 2.41 | % |
Other 5% Stockholders | |
| | | |
| | | |
| | | |
| | | |
| | |
(3) Fir Tree Capital Management LP | |
| 160,703 | | |
| 9.12 | % | |
| — | | |
| — | | |
| 3.69 | % |
(4) Spring Creek Capital, LLC | |
| 100,000 | | |
| 5.67 | % | |
| — | | |
| — | | |
| 2.29 | % |
(5) Koch Industries, Inc. | |
| 100,000 | | |
| 5.67 | % | |
| — | | |
| — | | |
| 2.29 | % |
(6) Cowen and Company, LLC | |
| 125,000 | | |
| 7.10 | % | |
| — | | |
| — | | |
| 2.87 | % |
(7) Mangrove Partners IM, LLC | |
| 217,523 | | |
| 12.34 | % | |
| — | | |
| — | | |
| 5.00 | % |
(8) Walleye Capital LLC | |
| 183,571 | | |
| 10.42 | % | |
| — | | |
| — | | |
| 4.22 | % |
(1) |
Singto, LLC, f/k/a Koo Dom Investment, LLC, our sponsor, is the record holder of the securities
reported herein. Mr. Suradech Taweesaengsakulthai, our Chief Executive Officer, is the manager and a member of our sponsor.
By virtue of this relationship, Mr. Suradech Taweesaengsakulthai may be deemed to share beneficial ownership of the securities
held of record by our sponsor. Mr. Suradech Taweesaengsakulthai disclaims any such beneficial ownership except to the extent
of his pecuniary interest. The business address of each of these entities and individuals is 848 Brickell Avenue, Penthouse 5, Miami,
FL 33131. |
(2) |
Interests shown consist solely of founder
shares, classified as shares of Class B common stock, after the IPO. Founder shares are convertible into shares of Class A
common stock on a one-for-one basis, subject to adjustment. Reflects the shares transferred to each of the individuals named.
|
(3) |
According to a Schedule 13G filed with
the SEC on February 14, 2024, on behalf of Fir Tree Capital Management LP a Delaware limited partnership, located at 500 5th
Avenue, 9th Floor, New York, New York 10110.
|
(4) |
According to a Schedule 13G filed with
the SEC on February 9, 2024, on behalf of Spring Creek Capital, LLC (“Spring Creek”), SCC Holdings, LLC
(“SCC”), KIM, LLC (“KIM”), Koch Investments Group, LLC (“KIG”), Koch Investments Group Holdings,
LLC (“KIGH”), and Koch Industries, Inc. (“Koch Industries”). Their business address is 4111 E. 37th Street
North, Wichita, KS 67220. Spring Creek is beneficially owned by SCC, SCC is beneficially owned by KIM, KIM is beneficially owned by
KIG, KIG is beneficially owned by KIGH, and KIGH is beneficially owned by Koch Industries, in each case by means of ownership of all
voting equity instruments. Koch Industries, SCC, KIM, KIG, and KIGH may be deemed to beneficially own the Public Shares held by
Spring Creek by virtue of (i) Koch Industries’ beneficial ownership of KIGH, (ii) KIGH’s beneficial ownership of KIG,
(iii) KIG’s beneficial ownership of KIM, (iv) KIM’s beneficial ownership of SCC and (v) SCC’s beneficial ownership
of Spring Creek.
|
(5) |
According to a Schedule 13G filed with
the SEC on February 9, 2024, on behalf of Spring Creek Capital, LLC (“Spring Creek”), SCC Holdings, LLC
(“SCC”), KIM, LLC (“KIM”), Koch Investments Group, LLC (“KIG”), Koch Investments Group Holdings,
LLC (“KIGH”), and Koch Industries, Inc. (“Koch Industries”). Their business address is 4111 E. 37th Street
North, Wichita, KS 67220. Spring Creek is beneficially owned by SCC, SCC is beneficially owned by KIM, KIM is beneficially owned by
KIG, KIG is beneficially owned by KIGH, and KIGH is beneficially owned by Koch Industries, in each case by means of ownership of all
voting equity instruments. Koch Industries, SCC, KIM, KIG, and KIGH may be deemed to beneficially own the Public Shares held by
Spring Creek by virtue of (i) Koch Industries’ beneficial ownership of KIGH, (ii) KIGH’s beneficial ownership of KIG,
(iii) KIG’s beneficial ownership of KIM, (iv) KIM’s beneficial ownership of SCC and (v) SCC’s beneficial ownership
of Spring Creek.
|
(6) |
According to a Schedule 13G filed with
the SEC on February 2, 2024, on behalf of Cowen and Company, LLC. Their business address is 599 Lexington Ave., New York, NY
10022.
|
(7) | According to a Schedule 13G filed with the SEC on January
10, 2024, on behalf of Mangrove Partners IM, LLC., a Delaware limited liability company is located at c/o Delaware Corporations LLC,
1000 N. West Street, Suite 1501, Wilmington, DE 19801. Nathaniel August, a United States citizen, is located at 2 Sound View Drive, 3rd
Floor, Greenwich, Connecticut 06830. The shares are held by the Mangrove Partners Master Fund, Ltd., a Cayman Islands limited liability
company (“Master Fund”). Beneficial ownership of the Shares is claimed by (i) Mangrove Partners IM, LLC which serves as the
investment manager of the Master Fund, and (ii) Nathaniel August who is the principal of Mangrove Partners. According to Schedule
13G filed with the SEC on January 10, 2024, on behalf of Walleye Capital LLC, a Minnesota limited liability company, 2800 Niagara Lane
N, Plymouth, MN 55447. |
(8) | The table above includes the shares of common stock underlying
the Private Placement Units held or to be held by our Sponsor. However, these securities are not exercisable within 60 days
of the record date for the Special Meeting. |
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS, AND DIRECTOR INDEPENDENCE
On June 30, 2021, our sponsor
purchased 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.009 per share. On July 1, 2021, our
sponsor transferred 30,000 shares to Suradech Taweesaengsakulthai, 30,000 shares to Chee Han Wen, 25,000 shares to H.R.H. Tunku Naquiyuddin
ibni Tuanku Ja’afar, 8,000 shares to J. Gerald Combs, 6,000 shares to Suthee Chivaphongse, and 6,000 shares to Somnuek Anakwat.
On October 11, 2021, our sponsor surrendered 287,500 founder shares to the Company for cancellation.
Simultaneously with the
closing of our IPO on December 29, 2021, our Sponsor purchased an aggregate of 466,150 Placement Units at a price of $10.00 per unit
for an aggregate purchase price of $4,661,500. Each Unit consists of one share of Class A common stock of the Company, par value $0.0001
per share (“Class A Common Stock”) and one redeemable warrant of the Company (“Warrant”), with each Warrant entitling
the holder thereof to purchase one share of Class A Common Stock for $11.50 per share. A total of $105,052,500, comprised of the proceeds
from the Offering and the proceeds of the sale of the Private Placement Units, net of the underwriting commissions, discounts, and offering
expenses, was placed in a U.S.-based trust account, maintained by Continental Stock Transfer & Trust Company, acting as trustee.
If we do not complete an initial business combination by March 29, 2023 (or until December 29, 2024 if we extend the period of time to
consummate a business combination), the proceeds from the sale of the Private Placement Units will be used to fund the redemption of
the public shares (subject to the requirements of applicable law), and the Private Placement Warrants will expire worthless.
Commencing on December 29,
2021, we agreed to pay an affiliate of our Sponsor, a total of $10,000 per month for office space, utilities and secretarial and administrative
support. Upon completion of our initial business combination or our liquidation, we will cease paying these monthly fees.
Other than the foregoing,
no compensation of any kind, including any finder’s fee, reimbursement, consulting fee or monies in respect of any payment of a
loan, will be paid by us to our Sponsor, officers, or directors or any affiliate of our Sponsor, officers, or directors prior to, or
in connection with any services rendered in order to effectuate, the consummation of an initial business combination (regardless of the
type of transaction that it is). However, these individuals will be reimbursed for any out-of-pocket expenses incurred in connection
with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations.
Our audit committee reviews on a quarterly basis all payments that were made to our Sponsor, officers, directors, or our or their affiliates
and determines 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.
On June 30, 2021, our Sponsor
agreed to loan us up to $300,000 to be used for a portion of the expenses of our initial public offering and we issued an unsecured promissory
note to our Sponsor. On October 26, 2021 we entered into an Amendment to the Promissory Note with the Sponsor. Pursuant to the terms
of our Amended Promissory Note, we may borrow up to an aggregate principal amount of $300,000. The Amended Promissory Note is non-interest
bearing and payable on the earlier of (i) February 28, 2022 or (ii) the completion of our initial public offering. As of December 31,
2023, there were no amounts outstanding under any such loans.
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 officers and directors may, but are not obligated to, loan us funds on a non-interest-bearing basis as may be required.
If we complete an initial business combination, we would repay such loaned amounts. In the event that the 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 for such repayment. Up to $1,500,000 of such loans may be convertible into units, at a price of
$10.00 per unit at the option of the lender, upon consummation of our initial business combination. Prior to the completion of our initial
business combination, 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. If we are unable to obtain these loans, we may be unable to complete our initial business combination. If we are unable
to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations
and liquidate the trust account. Consequently, our public stockholders may only receive approximately $10.15 per share on our redemption
of our public shares, or less in certain circumstances, and our warrants will expire worthless. In certain circumstances, our public
stockholders may receive less than $10.15 per share on the redemption of their shares. As of December 31, 2023, there were no amounts
outstanding under the any such loans.
On September 21, 2023, the
Company held a Special Meeting of Stockholders (the “Meeting”). At the Meeting, the Company’s stockholders approved
the Charter Amendment, which extends the date by which the Company must consummate its initial Business Combination from December 29,
2023 to December 29, 2024, subject to the approval of the Board of Directors of the Company, provided the sponsor or its designees deposit
into the trust account an amount equal to $40,000, prior to the commencement of each extension period (the “Extension”).
The Company filed the Charter Amendment with the Office of the Secretary of State of Delaware on September 28, 2023. At the Meeting,
the Company’s stockholders approved the Charter Amendment extending the date by which the Company must consummate the initial Business
Combination from December 29, 2023 to December 29, 2024, (or such earlier date as determined by the Company’s Board of Directors)
(the “Extension Amendment Proposal”). Stockholders holding 3,298,311 shares of common stock exercised their right to redeem
their shares for cash at an approximate price of $10.72 per share of the funds in the Trust Account. As a result, approximately $35,448,259
were removed from the Trust Account to pay such holders.
Following the redemption,
the Company’s remaining shares of Class A common stock outstanding were 1,762,409. The Sponsor has made the monthly deposit into
the Trust Account of $40,000 for the monthly extension, from September 29, 2023 until April 29, 2023.
The Company also made an
amendment to the Company’s investment management trust agreement (the “Trust Agreement”), dated as of December 23,
2021, as amended by and between the Company and Continental Stock Transfer & Trust Company, allowing the Company to extend the business
combination period from December 29 2023 to December 29, 2024, and updating certain defined terms in the Trust Agreement (the “Second
Amendment to the Trust Agreement”).
After our initial business
combination, members of our management team who remain with us may be paid consulting, management or other fees from the combined company
with any and all amounts being fully disclosed to our stockholders, to the extent then known, in the tender offer or proxy solicitation
materials, as applicable, furnished to our stockholders. It is unlikely the amount of such compensation will be known at the time of
distribution of such tender offer materials or at the time of a stockholder meeting held to consider our initial business combination,
as applicable, as it will be up to the directors of the post-combination business to determine executive and director compensation.
The holders of the founder
shares, placement units (including securities contained therein) and units (including securities contained therein) that may be issued
upon conversion of working capital loans, and any shares of Class A common stock issuable upon the exercise of the placement warrants
and any shares of Class A common stock, warrants (and underlying Class A common stock) that may be issued upon conversion of the units
issued as part of the working capital loans and Class A common stock issuable upon conversion of the founder shares, will be entitled
to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of the IPO, requiring
us to register such securities for resale (in the case of the founder shares, only after conversion to our Class A common stock). The
holders of the majority of these securities are entitled to make up to three demands, excluding short form demands, that we register
such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements
filed subsequent to our completion of our initial business combination and rights to require us to register for resale such securities
pursuant to Rule 415 under the Securities Act. The registration rights agreement does not contain liquidated damages or other cash settlement
provisions resulting from delays in registering our securities. We will bear the expenses incurred in connection with the filing of any
such registration statements.
Related Party Policy
We have adopted a code of
ethics requiring us to avoid, wherever possible, all conflicts of interests, except under guidelines or resolutions approved by our board
of directors (or the appropriate committee of our board) or as disclosed in our public filings with the SEC. Under our code of ethics,
conflict of interest situations will include any financial transaction, arrangement or relationship (including any indebtedness or guarantee
of indebtedness) involving the company. We have filed a copy of our code of ethics with the SEC and a copy is available on our website.
You are able to review our code of ethics by accessing our public filings at the SEC’s web site at www.sec.gov. In addition, a
copy of the code of ethics will be provided without charge upon request from us. We intend to disclose any amendments to or waivers of
certain provisions of our code of ethics in a Current Report on Form 8-K.
In addition, our audit committee,
pursuant to a written charter that we have adopted, is responsible for reviewing and approving related party transactions to the extent
that we enter into such transactions. An affirmative vote of a majority of the members of the audit committee present at a meeting at
which a quorum is present will be required in order to approve a related party transaction. A majority of the members of the entire audit
committee will constitute a quorum. Without a meeting, the unanimous written consent of all of the members of the audit committee will
be required to approve a related party transaction. We have filed a copy of our audit committee charter with the SEC and a copy is available
on our website. We also require each of our directors and executive officers to complete a directors’ and officers’ questionnaire
that elicits information about related party transactions.
These procedures are intended
to determine whether any such related party transaction impairs the independence of a director or presents a conflict of interest on
the part of a director, employee or officer.
To further minimize conflicts
of interest, we have agreed not to consummate an initial business combination with an entity that is affiliated with any of our Sponsor,
officers or directors unless we, or a committee of independent directors, have obtained an opinion from an independent investment banking
firm or another independent entity that commonly renders valuation opinions that our initial business combination is fair to our company
from a financial point of view. Furthermore, no finder’s fees, reimbursements, consulting fee, monies in respect of any payment
of a loan or other compensation will be paid by us to our Sponsor, officers or directors or any affiliate of our Sponsor, officers or
directors prior to, for services rendered to us prior to, or in connection with any services rendered in order to effectuate, the consummation
of our initial business combination (regardless of the type of transaction that it is). However, the following payments will be made
to our Sponsor, officers, or directors, or our or their affiliates, none of which will be made from the proceeds of the IPO held in the
trust account prior to the completion of our initial business combination:
| ● | Repayment of up to an aggregate
of $300,000 in loans that we may draw down made to us by our Sponsor to cover offering-related and organizational expenses; |
| ● | Payment to Singto, LLC, f/k/a Koo Dom Investment, LLC, our sponsor, of $10,000 per month, for up to 24 months, for office space, utilities and secretarial and administrative support; |
| ● | Reimbursement for any out-of-pocket
expenses related to identifying, investigating and completing an initial business combination; |
|
● |
Repayment of non-interest bearing loans which may be made by our sponsor
or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended
initial business combination, the terms of which (other than as described above) have not been determined nor have any written agreements
been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit at
the option of the lender, upon consummation of our initial business combination. The units would be identical to the placement units; |
|
● |
At the closing of our initial business combination, we may pay customary
financial consulting fees. We may pay such financial consulting fees in the event our initial shareholders, officers, directors or
their affiliates provide us with specific target company, industry, financial or market expertise, as well as insights, relationships,
services or resources in order to assess, negotiate and consummate an initial business combination. The amount of any such financial
consulting fee we pay will be based upon the prevailing market for similar services for comparable transactions at such time, and
will be subject to the review of our audit committee pursuant to the audit committee’s policies and procedures relating to
transactions that may present conflicts of interest. We would disclose any such fee in the proxy or tender offer materials used in
connection with a proposed business combination. |
Our audit committee reviews
on a quarterly basis all payments that were made to our Sponsor, officers, directors or our or their affiliates.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
The following is a summary
of fees paid or to be paid to Adeptus Partners, LLC (“Adeptus”) for services rendered.
Audit Fees. Audit
fees consist of fees billed for professional services rendered for the audit of our year-end financial statements and services that are
normally provided by Adeptus in connection with regulatory filings. The aggregate fees billed by Adeptus for professional services rendered
for the audit of our annual financial statements, review of the financial information included in our Form 10-K for the respective periods
and other required filings with the SEC for the period for the years ended December 31, 2023 and 2022 totaled approximately $62,500
and $56,000.
Audit-Related Fees.
Audit-related services consist of fees billed for assurance and related services that are reasonably related to performance of the audit
or review of our financial statements and are not reported under “Audit Fees.” These services include attest services that
are not required by statute or regulation and consultations concerning financial accounting and reporting standards. We did not pay Adeptus
for consultations concerning financial accounting and reporting standards for the period from June 9, 2021 (inception) through December
31, 2023.
Tax Fees. We did
not pay Adeptus for tax planning and tax advice for the period from June 9, 2021(inception) through December 31, 2023.
All Other Fees. We
did not pay Adeptus for other services for the period from June 9, 2021 (inception) through December 31, 2023.
Pre-Approval Policy
Our audit committee was
formed upon the consummation of our initial public offering. As a result, the audit committee did not pre-approve all of the foregoing
services, although any services rendered prior to the formation of our audit committee were approved by our board of directors. Since
the formation of our audit committee, and on a going-forward basis, the audit committee has and will pre-approve all auditing services
and permitted non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject to the de minimis
exceptions for non-audit services described in the Exchange Act which are approved by the audit committee prior to the completion of
the audit).
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENTS, AND
SCHEDULES
(a) |
The following documents are filed as part of this report: |
|
(2) |
Financial Statement Schedules: |
All financial statement schedules
are omitted because they are not applicable or the amounts are immaterial and not required, or the required information is presented
in the financial statements and notes beginning on F-1 on this Report.
We hereby file as part of this Report
the exhibits listed in the attached Exhibit Index. Exhibits which are incorporated herein by reference can be inspected and copied at
the public reference facilities maintained by the SEC, 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Copies of such material
can also be obtained from the Public Reference Section of the SEC, 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates or
on the SEC website at www.sec.gov.
EXHIBIT INDEX
Exhibit No. |
|
Description |
3.1 |
|
Certificate of Amendment to Amended and restated Certificate of Incorporation. (5) |
3.2 |
|
Second Amendment to the Amended and Restated Certificate of Incorporation (4) |
3.3 |
|
Certificate of Amendment to Amended and restated Certificate of Incorporation (9) |
3.4 |
|
Bylaws. (2) |
4.1 |
|
Specimen Unit Certificate (2) |
4.2 |
|
Specimen Class A Common Stock Certificate. (2) |
4.3 |
|
Specimen Warrant Certificate. (2) |
4.4 |
|
Warrant Agreement between Continental Stock Transfer & Trust Company and the Registrant. (1) |
4.5 |
|
Description of Registered Securities.* |
10.1 |
|
Letter Agreement among the Registrant and our officers, directors and Singto, LLC, f/k/a Koo Dom Investment, LLC
(1) |
10.3 |
|
Investment Management Trust Agreement between Continental Stock Transfer & Trust Company and the Registrant. (1) |
10.4 |
|
Registration Rights Agreement between the Registrant and certain security holders (1) |
10.5 |
|
Placement Unit Purchase Agreement between the Registrant and Singto, LLC, f/k/a Koo Dom Investment, LLC (1) |
10.6 |
|
Administrative Services Agreement between Singto, LLC, f/k/a Koo Dom Investment, LLC and the Registrant. (1) |
10.7 |
|
Form of Indemnification Agreement (1) |
10.8 |
|
Form of First Amendment to the Trust Agreement (7) |
10.9 |
|
Form of Second Amendment to the Trust Agreement (8) |
14.1 |
|
Code of Ethics. (2) |
21.1 |
|
List of Subsidiaries (6) |
31.1 |
|
Certification of Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).*. |
31.2 |
|
Certification of Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a)* |
32.1 |
|
Certification of Principal Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.** |
32.2 |
|
Certification of Principal Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.** |
97 |
|
Arogo Capital Acquisition Corp. Clawback Policy |
101.INS |
|
Inline XBRL Instance Document.* |
101.SCH |
|
Inline XBRL Taxonomy Extension Schema Document.* |
101.CAL |
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document.* |
101.DEF |
|
Inline XBRL Taxonomy Extension Definition Linkbase Document.* |
101.LAB |
|
Inline XBRL Taxonomy Extension Label Linkbase Document.* |
101.PRE |
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document.* |
104 |
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).* |
(1) | Incorporated by reference to the Registrant’s Form
8-K filed with the SEC on December 30, 2021. |
(2) | Incorporated by reference to the Registrant’s Form
S-1 (SEC File No. 333-259338). |
(3) | Incorporated by reference to Annual Report Form 10-K filed
with the SEC on March 31, 2022. |
(4) | Incorporated by reference to the Registrant’s Form
8-K filed with the SEC on September 28, 2023. |
(5) | Incorporated by reference to the Registrant’s Form
8-K filed with the SEC on March 28, 2023. |
(6) | Incorporated by reference to the Registrant’s Form
10-K filed with the SEC on March 31, 2023. |
(7) | Incorporated by reference to the Registrant’s Form
8-K/A filed with the SEC on April 18, 2023. |
(8) | Incorporated by reference to the Registrant’s Form
10-Q filed with the SEC on November 14, 2023. |
(9) | Incorporated by reference to the Registrant’s Form
8-K filed with the SEC on September 28, 2023. |
Item 16. FORM 10-K SUMMARY
None.
SIGNATURES
Pursuant to the requirements
of the Section 13 or 15(d) 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 on the 10th day of May 2024.
|
AROGO CAPITAL ACQUISITION CORP. |
|
|
|
|
By: |
/s/ Suradech Taweesaengsakulthai |
|
|
Suradech Taweesaengsakulthai
Chief Executive Officer |
In accordance with the Securities
Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.
Name |
|
Title |
|
Date |
|
|
|
|
|
/s/ Suradech Taweesaengsakulthai |
|
Chief Executive Officer and Director |
|
May 10, 2024 |
Suradech Taweesaengsakulthai |
|
(Principal Executive Officer) |
|
|
|
|
|
|
|
/s/ Suthee Chivaphongse |
|
Chief Financial Officer |
|
May 10, 2024 |
Suthee Chivaphongse |
|
(Principal Financial and Accounting Officer) |
|
|
|
|
|
|
|
/s/ Chee Han Wen |
|
Chief Strategy Officer |
|
May 10, 2024 |
Chee Han Wen |
|
|
|
|
|
|
|
|
|
/s/ H.R.H. Tunku Naquiyuddin ibni
Tuanku Ja’afar |
|
Director |
|
May 10, 2024 |
H.R.H. Tunku Naquiyuddin ibni Tuanku Ja’afar |
|
|
|
|
|
|
|
|
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/s/ Somnuek Anakwat |
|
Director |
|
May 10, 2024 |
Somnuek Anakwat |
|
|
|
|
|
|
|
|
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/s/ J. Gerald Combs |
|
Director |
|
May 10, 2024 |
J. Gerald Combs |
|
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|
AROGO CAPITAL ACQUISITION CORP.
INDEX TO FINANCIAL STATEMENTS
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and
Shareholders of Arogo Capital Acquisition Corp.
Opinion on the Financial Statements
We have audited the accompanying balance sheets
of Arogo Capital Acquisition Corp. (the Company) as of December 31, 2023 and 2022, and the related statements of operations, changes in
shareholders’ deficit, and cash flows for each of the years in the two-year period ended December 31, 2023, and the related notes
(collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects,
the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each
of the years in the two-year period ended December 31, 2023, in conformity with accounting principles generally accepted in the United
States of America.
Substantial Doubt about the Company’s Ability to Continue
as a Going Concern
The accompanying financial statements have been
prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, management has
determined that given the liquidity condition and the date for mandatory liquidation and subsequent dissolution raises substantial doubt
about our ability to continue as a going concern. Accordingly, the Company plan to consummate a Business Combination prior to the mandatory
liquidation date. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility
of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our
audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required
to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations
of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged
to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding
of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s
internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ Adeptus Partners, LLC
Adeptus Partners, LLC
We have served as the Company’s auditor since 2021.
Ocean, New Jersey
May 10, 2024
Item 1. Financial Statements
AROGO
CAPITAL ACQUISITION CORP.
BALANCE
SHEETS
| |
December 31, | | |
December 31, | |
| |
2023 | | |
2022 | |
| |
| | |
| |
ASSETS | |
| | |
| |
Current Assets-Cash | |
$ | 79,026 | | |
$ | 52,989 | |
Prepaid expenses | |
| 292,444 | | |
| 81,545 | |
Total Current Asset | |
| 371,470 | | |
| 134,534 | |
| |
| | | |
| | |
Cash and marketable securities held in the trust | |
| 19,187,175 | | |
| 105,941,664 | |
Total assets | |
$ | 19,558,645 | | |
$ | 106,076,198 | |
| |
| | | |
| | |
LIABILITIES AND SHAREHOLDERS’ DEFICIT | |
| | | |
| | |
Current liabilities | |
| | | |
| | |
Accrued expenses | |
$ | 1,036,443 | | |
$ | 568,844 | |
Other Payables | |
| 200,000 | | |
| 80,000 | |
Tax Payable | |
| 80,000 | | |
| 109,749 | |
Income tax payable | |
| - | | |
| 165,799 | |
Excise tax | |
| 901,240 | | |
| - | |
Working capital loan | |
| 180,000 | | |
| - | |
Extension loan | |
| 1,309,996 | | |
| - | |
Due to related party | |
| 262,585 | | |
| - | |
Advanced from related parties | |
| 67,198 | | |
| 67,198 | |
Total Current liabilities | |
| 4,037,462 | | |
| 991,590 | |
| |
| | | |
| | |
Deferred Underwriting Commission | |
| 3,622,500 | | |
| 3,622,500 | |
Total liabilities | |
| 7,659,962 | | |
| 4,614,090 | |
| |
| | | |
| | |
Commitments and Contingencies (Note 6) | |
| | | |
| | |
Class A common stock subject to possible redemption; 1,762,409 and 10,350,000 shares issued and outstanding at redemption value of $10.89 per share and $10.24 per share at December 31, 2023 and December 31,2022 respectively | |
| 19,187,175 | | |
| 105,941,664 | |
Shareholders’ Deficit | |
| | | |
| | |
Preferred share, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | |
| - | | |
| - | |
Class A common stock, $0.0001 par value; 100,000,000 shares authorized; 492,025 issued and outstanding (excluding 5,060,720 and 10,350,000 share subject to possible redemption) at December 31,2023 and December 31, 2022 | |
| 49 | | |
| 49 | |
Class B common stock, par value $0.0001; 10,000,000 shares authorized; 2,587,500 issued and outstanding (1) on December 31, 2023 and December 31, 2022 | |
| 259 | | |
| 259 | |
| |
| | | |
| | |
Additional paid in capital | |
| - | | |
| - | |
Accumulated deficit | |
| (7,288,800 | ) | |
| (4,479,864 | ) |
Total shareholders’ deficit | |
| (7,288,492 | ) | |
| (4,479,556 | ) |
Total liabilities and shareholders’ deficit | |
$ | 19,558,645 | | |
$ | 106,076,198 | |
The accompanying notes are an integral part of
these financial statements.
AROGO
CAPITAL ACQUISITION CORP.
STATEMENTS OF OPERATIONS
| |
For the Year Ended | | |
For the Year
Ended | |
| |
December 31, 2023 | | |
December 31,
2022 | |
| |
| | |
| |
Formation and Operating costs | |
$ | 1,162,659 | | |
$ | 1,462,908 | |
Franchise tax | |
| 200,000 | | |
| 200,050 | |
Loss from operation | |
| (1,362,659 | ) | |
| (1,662,958 | ) |
| |
| | | |
| | |
Interest earned | |
| 43 | | |
| 18 | |
Unrealised Gain/Loss on marketable securities hold in the trust account | |
| 3,124,054 | | |
| 1,102,427 | |
Other Income (Loss) | |
| 3,124,097 | | |
| 1,102,445 | |
Income (Loss) before provision for income taxes | |
| 1,761,438 | | |
| 560,513 | |
Provision for income taxes | |
| (299,623 | ) | |
| (165,799 | ) |
Net Income (Loss) | |
$ | 1,461,815 | | |
$ | (726,312 | ) |
| |
| | | |
| | |
Weighted average shares of Class A Common Stock | |
| 6,333,164 | | |
| 10,842,025 | |
Basic and diluted net income (loss) per common share | |
| 0.31 | | |
| (0.03 | ) |
Weighted average shares of Class B Common Stock | |
| 2,587,500 | | |
| 2,587,500 | |
Basic and diluted net income (loss) per common share | |
$ | (0.20 | ) | |
$ | (0.14 | ) |
The accompanying notes are an integral part of
these financial statements.
AROGO CAPITAL ACQUISITION CORP.
STATEMENTS OF CHANGES IN SHAREHOLDERS’
DEFICIT
| |
Class A | | |
Class B | | |
Additional | | |
| | |
Total | |
| |
Common Stock | | |
Common Stock | | |
Paid in | | |
Accumulated | | |
Shareholders’ | |
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Deficit | |
Balance – January 1, 2023 (Audited) | |
| 492,025 | | |
$ | 49 | | |
| 2,587,500 | | |
$ | 259 | | |
$ | - | | |
$ | (4,479,864 | ) | |
$ | (4,479,556 | ) |
Net income | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| 1,461,815 | | |
| 1,461,815 | |
Additional amount deposit into trust | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (1,309,996 | ) | |
| (1,309,996 | ) |
Re-measurement of common stock subject to redemption | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (2,059,515 | ) | |
| (2,059,515 | ) |
Excise tax | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (901,240 | ) | |
| (901,240 | ) |
Balance – December 31, 2023 | |
| 492,025 | | |
$ | 49 | | |
| 2,587,500 | | |
$ | 259 | | |
| - | | |
$ | (7,288,800 | ) | |
$ | (7,288,492 | ) |
| |
Class A | | |
Class B | | |
Additional | | |
| | |
Total | |
| |
Common Stock | | |
Common Stock | | |
Paid in | | |
Accumulated | | |
Shareholders’ | |
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Deficit | |
Balance – January 1, 2022 (Audited) | |
| 492,025 | | |
$ | 49 | | |
| 2,587,500 | | |
$ | 259 | | |
$ | - | | |
$ | (2,864,388 | ) | |
$ | (2,864,080 | ) |
Net loss | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (726,312 | ) | |
| (726,312 | ) |
Re-measurement of common stock subject to redemption | |
| - | | |
| - | | |
| - | | |
| - | | |
| - | | |
| (889,164 | ) | |
| (889,164 | ) |
Balance – December 31, 2022 | |
| 492,025 | | |
$ | 49 | | |
| 2,587,500 | | |
$ | 259 | | |
$ | - | | |
$ | (4,479,864 | ) | |
$ | (4,479,556 | ) |
The accompanying notes are an integral part of
these financial statements.
AROGO CAPITAL ACQUISITION CORP.
STATEMENTS OF CASH FLOWS
| |
For the Year Ended | | |
For the Year Ended | |
| |
December 31, 2023 | | |
December 31, 2022 | |
| |
(Audited) | | |
(Audited) | |
Cash flows from operating activities: | |
| | |
| |
Net Income (Loss) | |
$ | 1,461,815 | | |
$ | (726,312 | ) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |
| | | |
| | |
Interest earned | |
| (43 | ) | |
| (18 | ) |
Unrealized Gain/Loss from marketable securities held in the trust account | |
| (3,124,054 | ) | |
| (1,102,427 | ) |
Changes in operating assets and liabilities: | |
| | | |
| | |
Prepaid expenses | |
| (210,899 | ) | |
| (54,745 | ) |
Accrued expenses | |
| 467,599 | | |
| 544,862 | |
Accrued offering costs | |
| - | | |
| (45,000 | ) |
Other payables | |
| 120,000 | | |
| 70,889 | |
Advanced from related parties | |
| - | | |
| 20,000 | |
Franchise tax payable | |
| (29,749 | ) | |
| (3,127 | ) |
Income tax payable | |
| (165,799 | ) | |
| 165,799 | |
Due to related party | |
| 262,585 | | |
| - | |
Net cash used in operating activities | |
| (1,218,545 | ) | |
| (1,130,079 | ) |
| |
| | | |
| | |
Cash flows from investing activities: | |
| | | |
| | |
Investment of Cash in Trust Account - redemption | |
| 90,124,000 | | |
| - | |
Investment of Cash in Trust Account - extension | |
| (1,309,996 | ) | |
| - | |
Withdrawal from Trust Account | |
| 1,064,539 | | |
| 213,263 | |
Net cash provided by investing
activities | |
| 89,878,543 | | |
| 213,263 | |
| |
| | | |
| | |
Cash flows from financing activities: | |
| | | |
| | |
Interest earned on Cash account | |
| 43 | | |
| 18 | |
Redemption of common stock | |
| (90,124,000 | ) | |
| - | |
Proceeds from sponsor working capital loan | |
| 180,000 | | |
| - | |
Proceeds from extension loan | |
| 1,309,996 | | |
| - | |
Net cash provided by (used in) financing activities | |
| (88,633,961 | ) | |
| 18 | |
| |
| | | |
| | |
Net change in cash | |
| 26,037 | | |
| (916,798 | ) |
Cash at the beginning of the period | |
| 52,989 | | |
| 969,787 | |
Cash at the end of the period | |
$ | 79,026 | | |
$ | 52,989 | |
| |
| | | |
| | |
Supplemental disclosure of non-cash financing activities: | |
| | | |
| | |
Deferred underwriting fee payable | |
$ | - | | |
$ | 3,622,500 | |
Value of Class A common stock subject to redemption | |
$ | 19,187,175 | | |
$ | - | |
Re-measurement of common stock subject to redemption | |
$ | 2,059,515 | | |
$ | 899,164 | |
The accompanying notes are an integral part of
these financial statements.
AROGO CAPITAL ACQUISITION CORP.
Notes
to the financial statement
NOTE 1 — DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS
AND GOING CONCERN
Arogo Capital Acquisition
Corp. (the “Company”) was incorporated in Delaware on June 9, 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 not limited to a particular industry or sector for purposes of consummating a
Business Combination. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks
associated with early stage and emerging growth companies.
As of December 31, 2023,
the Company had not commenced any operations. All activity for the period from June 9, 2021 (inception) through December 31, 2023 relates
to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below. The
Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The
Company will generate non-operating income in the form of interest income from the proceeds derived from the Proposed Public Offering.
The Company has selected December 31 as its fiscal year end.
The registration statement
for the Company’s Initial Public Offering was declared effective on December 23, 2021. On December 29, 2021, the Company consummated
the Initial Public Offering of 9,000,000 units (“Units” and, with respect to the common stock included in the Units being
offered, the “Public Shares”), generating gross proceeds of $90,000,000, which is described in Note 3. The Company granted
the underwriter a 45-day option from the date of Initial Public Offering to purchase up to 1,350,000 additional Units to cover over-allotments,
if any, at the Initial Public Offering price less the underwriting discounts and commissions. On December 29, 2021, the underwriters exercised
this option and purchased 1,350,000 additional Units generating gross proceeds of $13,500,000.
Simultaneously with the closing
of the Initial Public Offering, the Company consummated the private sale (the “Private Placement”) of an aggregate of 422,275
Units (the “Private Placement Units”) to Singto, LLC, f/k/a Koo Dom Investment, LLC (the “Sponsor”) at a purchase price of $10.00
per Private Placement Unit, generating gross proceeds to the Company in the amount of $4,222,750. Upon exercise of the underwriter over-allotment
option, the Sponsor purchased an additional 43,875 Private Placement Units at a purchase price of $10.00 per unit generating additional
gross proceeds of $438,750.
As of December 29, 2021,
transaction costs amounted to $6,524,539 consisting of $1,811,250 of underwriting fees (gross of a discount of $400,000), $3,622,500 of
deferred underwriting fees payable (which are held in a trust account with Continental Stock Transfer & Trust Company acting as trustee
(the “Trust Account”), the fair value of the 25,875 shares of Class A common stock issued to the underwriter of $258,750 and
$832,039 of other offering costs related to the Initial Public Offering. Cash of $1,007,897 was held outside of the Trust Account on December
29, 2021 and was available for working capital purposes. As described in Note 6, the $3,622,500 deferred underwriting fees are contingent
upon the consummation of the Business Combination within 12 months (or up to 21 months if extended) from the closing of the Initial Public
Offering.
Following the closing of
the Initial Public Offering on December 29, 2021, an amount of $105,052,500 ($10.15 per Unit) from the net proceeds of the sale of the
Units in the Initial Public Offering and the Private Placement was placed in the Trust Account which may be invested in U.S. government
securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment
Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market
fund selected by the Company meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the
earlier of: (i) the consummation of a Business Combination or (ii) the distribution of the Trust Account, as described below.
The Company’s management
has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of Private
Placement Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination.
There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete one or
more initial Business Combinations with one or more operating businesses or assets with a fair market value equal to at least 80% of the
net assets held in the Trust Account (as defined below) (excluding the deferred underwriting commissions and taxes payable on the interest
earned on the Trust Account). The Company will only complete a Business Combination if the post-transaction company owns or acquires 50%
or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient
for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the “Investment
Company Act”). Upon the closing of the Initial Public Offering, management has agreed that an amount equal to at least $10.15 per
Unit sold in the Initial Public Offering, including proceeds of the Private Placement Units, will be held in a trust account (“Trust
Account”), located in the United States and invested only in U.S. government securities, within the meaning set forth in Section
2(a)(16) of the Investment Company Act, with a maturity of 185 days or less or in any open-ended investment company that holds itself
out as a money market fund selected by the Company meeting certain conditions of Rule 2a-7 of the Investment Company Act, as determined
by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the funds held in the
Trust Account, as described below.
The Company will provide
the holders of the outstanding Public Shares (the “Public Shareholders”) with the opportunity to redeem all or a portion of
their Public Shares either (i) in connection with a shareholder meeting called to approve the Business Combination or (ii) by means of
a tender offer in connection with the Business Combination. The decision as to whether the Company will seek shareholder approval of a
Business Combination or conduct a tender offer will be made by the Company. The Public Shareholders will be entitled to redeem their Public
Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.15 per Public Share, plus any pro
rata interest then in the Trust Account, net of taxes payable). There will be no redemption rights upon the completion of a Business Combination
with respect to the Company’s warrants. The Public Shares subject to redemption will be recorded at a redemption value and classified
as temporary equity upon the completion of the Initial Public Offering in accordance with the Accounting Standards Codification (“ASC”)
Topic 480 “Distinguishing Liabilities from Equity” (ASC 480).
All of the Public Shares
contain a redemption feature which allows for the redemption of such Public Shares in connection with our liquidation, if there is a stockholder
vote or tender offer in connection with our initial business combination and in connection with certain amendments to our amended and
restated certificate of incorporation. In accordance with SEC and its guidance on redeemable equity instruments, which has been codified
in ASC 480-10-S99, redemption provisions not solely within the control of a company require common stock subject to redemption to be classified
outside of permanent equity. Given that the Public Shares will be issued with other freestanding instruments (i.e., public warrants).
the initial value of Class A common stock classified as temporary equity will be the allocated proceeds determined in accordance with
ASC 470-20. The Class A common stock is subject to ASC 480-10-S99. If it is probable that the equity instrument will become redeemable.
we have the option to either (i) accrete changes in the redemption value over the period from the date of issuance (or from the date that
it becomes probable that the instrument will become redeemable, if later) to the earliest redemption date of the instrument or (ii) recognize
changes in the redemption value immediately as they occur and adjust the carrying amount of the instrument to equal the redemption value
at the end of each reporting period. We have elected to recognize the changes immediately. The accretion or remeasurement will be treated
as a deemed dividend (i.e., a reduction to retained earnings. or in absence of retained earnings. additional paid-in capital). While redemptions
cannot cause the Company’s net tangible assets to fall below $5,000,001, the Public Shares are redeemable and will be classified
as such on the balance sheet until such date that a redemption event takes place.
If the Company seeks stockholder
approval of the Business Combination, the Company will proceed with a Business Combination if a majority of the outstanding shares voted
are voted in favor of the Business Combination, or such other vote as required by law or stock exchange rule. If a stockholder vote is
not required by applicable law or stock exchange listing requirements and the Company does not decide to hold a stockholder vote for
business or other reasons, the Company will, pursuant to its amended and restated certificate of incorporation (the “Certificate
of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”)
and file tender offer documents with the SEC prior to completing a Business Combination. If, however, stockholder approval of the transaction
is required by applicable law or stock exchange listing requirements, or the Company decides to obtain stockholder approval for business
or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not
pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the Sponsor
has agreed to vote its Founder Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering
in favor of approving a Business Combination. Additionally, each Public Stockholder may elect to redeem their Public Shares without voting,
and if they do vote, irrespective of whether they vote for or against the proposed transaction.
Notwithstanding the foregoing,
if the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules,
the Certificate of Incorporation provides that a Public Stockholder, together with any affiliate of such stockholder or any other person
with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate
of 15% of the Public Shares, without the prior consent of the Company.
The holders of the Founder
Shares have agreed (a) to waive their redemption rights with respect to the Founder Shares and Public Shares held by them in connection
with the completion of a Business Combination and (b) not to propose an amendment to the Certificate of Incorporation (i) to modify the
substance or timing of the Company’s obligation to allow redemptions in connection with a Business Combination or to redeem 100%
of its Public Shares if the Company does not complete a Business Combination within the Combination Period (as defined below) or (ii)
with respect to any other provision relating to stockholders’ rights or pre-business combination activity, unless the Company provides
the Public Stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment.
Charter Amendments
On March 24, 2023, the
Company held a Special Meeting of Stockholders (the “Meeting”). At the Meeting, the Company’s stockholders
approved the Charter Amendment, which extends the date by which the Company must consummate its initial Business Combination from
March 29, 2023 to December 29, 2023, subject to the approval of the Board of Directors of the Company, provided the sponsor or its
designees deposit into the trust account an amount equal to $0.0378 per share for each public share or $191,666, prior to the
commencement of each extension period (the “Extension”). The Company filed the Charter Amendment with the Office of the
Secretary of State of Delaware on September 28, 2023. At the Meeting, the Company’s stockholders approved the Charter
Amendment extending the date by which the Company must consummate the initial Business Combination from March 29, 2023 to December
29, 2023, (or such earlier date as determined by the Company’s Board of Directors) (the “Extension Amendment
Proposal”). Stockholders holding 5,289,280 shares of common stock exercised their right to redeem their shares for cash at an
approximate price of $10.74 per share of the funds in the Trust Account. As a result, approximately $54,675,740 were removed from
the Trust Account to pay such holders.
Following the redemption,
the Company’s remaining shares of Class A common stock outstanding were 5,060,720. The Sponsor has continued to make monthly deposits
into the Trust Account of $191,666 for five of the nine monthly extensions, from March 29, 2023 until August 29, 2023.
The Company also made an
amendment to the Company’s investment management trust agreement (the “Trust Agreement”), dated as of December 23, 2021,
by and between the Company and Continental Stock Transfer & Trust Company, allowing the Company to extend the business combination
period from March 29, 2023 to December 29, 2023, and updating certain defined terms in the Trust Agreement (the “First Amendment
to the Trust Agreement”).
On September 21, 2023, the
Company held a Special Meeting of Stockholders (the “Meeting”). At the Meeting, the Company’s stockholders approved
the Charter Amendment, which extends the date by which the Company must consummate its initial Business Combination from December 29,
2023 to December 29, 2024, subject to the approval of the Board of Directors of the Company, provided the sponsor or its designees deposit
into the trust account an amount equal to $40,000, prior to the commencement of each extension period (the “Extension”). The
Company filed the Charter Amendment with the Office of the Secretary of State of Delaware on March 28, 2023. At the Meeting, the Company’s
stockholders approved the Charter Amendment extending the date by which the Company must consummate the initial Business Combination from
March 29, 2023 to December 29, 2023, (or such earlier date as determined by the Company’s Board of Directors) (the “Extension
Amendment Proposal”). Stockholders holding 3,298,311 shares of common stock exercised their right to redeem their shares for cash
at an approximate price of $10.72 per share of the funds in the Trust Account. As a result, approximately $35,448,259 were removed from
the Trust Account to pay such holders.
Following the redemption,
the Company’s remaining shares of Class A common stock outstanding were 1,762,409. The Sponsor has made the monthly deposit into
the Trust Account of $40,000 for the monthly extension, from September 29, 2023 until October 29, 2023.
The Company also made an
amendment to the Company’s investment management trust agreement (the “Trust Agreement”), dated as of December 23, 2021,
as amended by and between the Company and Continental Stock Transfer & Trust Company, allowing the Company to extend the business
combination period from December 29 2023 to December 29, 2024, and updating certain defined terms in the Trust Agreement (the “Second
Amendment to the Trust Agreement”).
The holders of the Founders
Shares have agreed to waive their liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination
within the Combination Period. However, if the holders of Founder Shares acquire Public Shares in or after the Initial Public Offering,
such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination
within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note
6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such
event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the
Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution
will be less than the Initial Public Offering price per Unit ($10.00).
In order to protect the amounts
held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party for services
rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction
agreement, reduce the amount of funds in the Trust Account to below (i) $10.15 per Public Share or (ii) such lesser amount per Public
Share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.15 per public Share due to reductions
in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, except as to any claims
by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the
Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under
the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to
be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims.
The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by
endeavoring to have all vendors, service providers (except for the Company’s independent registered accounting firm), prospective
target businesses and other entities with which the Company does business, execute agreements with the Company waiving any right, title,
interest or claim of any kind in or to monies held in the Trust Account.
Merger Agreement
On
April 25, 2022, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among the
Company, Arogo Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Arogo (“Merger Sub”), Eon Reality,
Inc., a California corporation (“EON”), Singto, LLC, f/k/a Koo Dom Investment, LLC, in its capacity as (“Purchaser Representative”),
and EON, in its capacity as (“Seller Representative”).
Pursuant
to the Merger Agreement, at the closing of the transactions contemplated by the Merger Agreement (the “Closing”),
Merger Sub will merge with and into EON, with EON continuing as the surviving corporation (the “Surviving Corporation”).
As
consideration for the Merger, the holders of EON securities collectively shall be entitled to receive from Arogo, in the aggregate, a
number of the Company securities with an aggregate value equal to (the “Merger Consideration”) (a) Five Hundred and
Fifty Million U.S. Dollars ($550,000,000) minus (b) the amount of Closing Net Indebtedness (the total portion of the Merger Consideration
amount payable to all EON Stockholders in accordance with the Merger Agreement is also referred to herein as the “Stockholder
Merger Consideration”). Additionally, the Company shall make available to EON (x) up to $105,052,500 Million U.S. Dollars for
working capital use and general corporate purposes, assuming no redemptions (the “Primary Capital”) and (y) the proceeds
from any PIPE Investment, any other alternative PIPE Investment and any other Private Placements, subject to the Closing conditions. The
closing of a PIPE investment is not a condition to closing of the Merger Agreement. There is no minimum cash condition to the closing
of the Merger Agreement.
Termination of
Material Definitive Agreement
On
November 7, 2023, the Company sent EON a termination notice (the “Termination Notice”) that the Company had terminated the
Business Combination Agreement (the “Termination”) and all Ancillary Agreements, pursuant to Section 8.1 (Termination) thereof
and as a remedy at law, based on breaches by EON of certain covenants contained in the Business Combination Agreement.
The Termination Notice
does not constitute a waiver of, and shall not prejudice any of the Company’s rights under the Business Combination Agreement or
at law. The Company reserves all such rights in full to pursue any and all loss of the Company, the Company Representative, and the
shareholders of the Company with respect to the Termination.
Liquidity and Management’s Plan
As of December 31, 2023 and
December 31, 2022 the Company had cash of $79,026 and $52,989 respectively and working capital deficit of $3,654,303 and a working capital
deficit $857,056 respectively. In connection with the Company’s assessment of going concern considerations in accordance with Accounting
Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a
Going Concern,” management has determined that given the liquidity condition and the date for mandatory liquidation and subsequent
dissolution raises substantial doubt about our ability to continue as a going concern. Accordingly, the Company plan to consummate a Business
Combination prior to the mandatory liquidation date. No adjustments have been made to the carrying amounts of assets or liabilities should
the Company be required to liquidate.
Risks and Uncertainties
Management is currently evaluating
the impact of the COVID-19 pandemic 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, close of the Proposed Public Offering and/or search for a target
company, the specific impact is not readily determinable as of the date of these financial statements. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
Basis of Presentation
The accompanying audited
balance sheet is presented in conformity with accounting principles generally accepted in the United States of America (“US GAAP”)
and pursuant to the rules and regulations of the SEC.
Emerging Growth Company
The Company is an “emerging
growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified
by the Jumpstart Our Business Startups Act of 2012, as amended (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 independent registered public accounting firm attestation requirements of Section
404 of the Sarbanes-Oxley Act, 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 stockholder 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 a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging
growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period
which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company,
as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.
This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company
nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential
differences in accounting standards used.
Use of Estimates
The preparation of the balance
sheet in conformity with US 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 balance sheet.
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 balance sheet, which management considered in formulating its estimate, could
change in the near term due to one or more future confirming events. Accordingly, 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 cash of
$79,026 and $52,989 for December 31, 2023 and December 31, 2022, respectively and no cash equivalents as of December 31, 2023 and December
31, 2022.
Cash held in Trust Account
At December 31, 2023 and
2022, substantially all of the assets held in the Trust Account were held in treasury trust funds. At December 31, 2023 and December 31,
2022 the Company had $19,187,175 and $105,941,664 in cash held in the Trust Account, respectively.
Offering Costs associated with the Initial
Public Offering
The Company complies with
the requirements of the Financial Accounting Standards Board (“FASB”) ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”)
Topic 5A, “Expenses of Offering.” Offering costs of $832,039 consisted principally of costs incurred in connection
with preparation for the Initial Public Offering. These offering costs, together with the underwriter fees of $5,433,750 (or $1,811,250
(gross of a discount of $400,000) paid in cash upon the closing of the Initial Public Offering and a deferred fee of $3,622,500) and the
fair value of the 25,875 shares of Class A common stock issued to the underwriter of $258,750, were charged to stockholders’ equity
upon completion of the Initial Public Offering.
Class A common stock subject to possible
redemption
The Company accounts for
its Class A common stock subject to possible redemption in accordance with the guidance enumerated in ASC 480 “Distinguishing
Liabilities from Equity”. Common stock subject to mandatory redemption are classified as a liability instrument and are measured
at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that are either within the
control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control)
is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A
common stock features certain redemption rights that are considered by the Company to be outside of the Company’s control and subject
to the occurrence of uncertain future events. Accordingly, at December 31, 2023 and December 31, 2022 the 1,762,409 and 10,350,000 shares
of Class A common stock subject to possible redemption in the amount of $19,187,175 and $105,941,664 is presented as temporary equity,
outside of the stockholders’ deficit section of the Company’s balance sheet, respectively.
As of December 31, 2023 and December 31, 2022,
the Class A Ordinary Shares reflected on the balance sheet are reconciled in the following table:
| |
December 31, | | |
December 31, | |
| |
2023 | | |
2022 | |
Redeemable Class A Common Stock – Opening Balance | |
$ | 105,941,664 | | |
$ | 105,052,500 | |
Less: | |
| | | |
| | |
Redemption of Class A common stock, including interest | |
| (90,124,000 | ) | |
| - | |
Plus: | |
| | | |
| | |
Re-measurement of carrying value to redemption value | |
| 3,369,511 | | |
| 889,164 | |
Redeemable Class A Common Stock - Ending Balance | |
| 19,187,175 | | |
| 105,941,664 | |
Income Taxes
The Company follows the asset
and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities
are recognized for the estimated future tax consequences attributable to differences between the financial statements 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 recovered or settled. The
effect on deferred tax assets and liabilities of a 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.
ASC 740 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 return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination
by taxing authorities. The Company’s management determined the United States is the Company’s only major tax jurisdiction.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if any, as income tax expense. There were no unrecognized
tax benefits as of December 31, 2023 and December 31, 2022 and no amounts accrued for interest and penalties. The Company is
currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
The Company is subject to income tax examinations by major taxing authorities since inception.
Income taxes was
accrued for $0 for the year ended December 31, 2023 and income tax was prepaid $292,444 and the income tax payable for December 31,
2022 was $165,799.
Net income
(loss) per share
The
Company complies with accounting and disclosure requirements of ASC Topic 260, “Earnings Per Share.” Net loss per share is
computed by dividing net income (loss) by the weighted average number of ordinary shares outstanding during the period, excluding ordinary
shares subject to forfeiture. As of December 31, 2023 and December 31, 2022, the calculation of diluted income (loss) per share does not
consider the effect of the warrants issued in connection with the Initial Public Offering and warrants issued as components of the Private
Placement Units (the “Placement Warrants”) since the exercise of the warrants are contingent upon the occurrence of future
events and the inclusion of such warrants would be anti-dilutive. As a result, diluted income (loss) per share is the same as basic loss
per share for the periods presented. Accretion associated with the redeemable shares of Class A Ordinary Shares is excluded from earnings
per share as the redemption value approximates fair value at December 31, 2023 and 2022.
The
net income (loss) per share presented in the statement of operations is based on the following:
| |
For the year ended December 31, 2023 | | |
For the year ended December 31, 2022 | |
| |
Class A
Common Stock | | |
Class B Common Stock | | |
Class A Common Stock | | |
Class B Common Stock | |
Basic and diluted net loss per share: | |
| | |
| | |
| | |
| |
Numerators: | |
| | |
| | |
| | |
| |
Allocation of expenses | |
$ | (1,180,126 | ) | |
| (482,156 | ) | |
$ | (1,476,406 | ) | |
$ | (352,351 | ) |
Interest | |
| 3,124,097 | | |
| - | | |
| 1,102,445 | | |
| - | |
Allocation of net (loss) income | |
$ | 1,943,971 | | |
$ | (482,156 | ) | |
$ | (373,961 | ) | |
$ | (352,351 | ) |
Denominators: | |
| | | |
| | | |
| | | |
| | |
Weighted-average shares outstanding | |
| 6,333,164 | | |
| 2,587,500 | | |
| 10,842,025 | | |
| 2,587,500 | |
Basic and diluted net income (loss) per share | |
$ | 0.31 | | |
$ | (0.19 | ) | |
$ | (0.03 | ) | |
$ | (0.14 | ) |
Concentration of Credit Risk
Financial instruments that potentially subject
to concentration of credit risk consist of cash and cash held in trust. Cash is comprised of cash balances with banks and bank deposits,
which are insured by the Federal Deposit Insurance Company (“FDIC”), up to $250,000. The Company did not have cash exceed
FDIC limits at December 31, 2023 and 2022. Cash held in trust is comprised of securities held by a financial institution, which are insured
by the Securities Investor Protection Corporation (“SIPC”), comprised of $250,000 coverage for cash and $250,000 for securities.
The Company had $18,937,175 and $105,691,664 of securities in excess of SIPC limits as of December 31, 2023 and 2022, respectively.
Fair Value of Financial Instruments
Fair value is defined
as the price that would be received for sale of an asset or paid to transfer of a liability, in an orderly transaction between market
participants at the measurement date. US 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, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; |
|
● |
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and |
|
● |
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
The
following table presents information about the Company’s financial assets that are measured at fair value on a recurring basis as
of December 31, 2023 and December 31, 2022:
| |
Level | |
December 31, 2023 | | |
December 31, 2022 | |
Assets: | |
| |
| | |
| |
Cash and marketable securities held in trust account | |
1 | |
$ | 19,187,175 | | |
$ | 105,076,198 | |
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”. Derivative instruments are initially recorded at fair value on the grant date and re-valued
at each reporting date, with changes in the fair value reported in the statements of operations. Derivative assets and liabilities are
classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument
could be required within 12 months of the balance sheet date. The Company accounts for the warrants in accordance with the guidance contained
in ASC 815-40. The Company has determined that the warrants qualify for the equity treatment in the Company’s financial statements.
Recent Accounting Standards
Management does not believe
that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s
balance sheet.
NOTE 3 — INITIAL PUBLIC OFFERING
Pursuant to the Initial
Public Offering, the Company sold 9,000,000 Units at a price of $10.00 per Unit. Each Unit consists of one share of Class A common stock
and one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class
A common stock at a price of $11.50 per share, subject to adjustment (see Note 7). On December 29, 2021, the underwriters exercised the
over-allotment option by purchasing 1,350,000 additional units, generating $13,500,000.
NOTE 4 — PRIVATE PLACEMENTS
The Sponsor purchased an
aggregate of 466,150 Private Placement Units at a price of $10.00 per Private Placement Unit generating an aggregate of $4,661,500 from
the Company in private placements that occurred simultaneously with the closing of the Initial Public Offering. Each Private Placement
Unit is comprised of one Class A share and one warrant. Each Private Placement Warrant is exercisable to purchase one share of Common
stock at a price of $11.50 per share, subject to adjustment (see Note 7). The proceeds from the sale of the Private Placement Units were
added to the net proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination
within the Combination Period, the proceeds from the sale of the Private Placement Units held in the Trust Account will be used to fund
the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless.
The Private Placement Units (including Class A Common stock issuable upon exercise of the Private Placement Warrants) will not be transferable,
assignable or salable until 30 days after the completion of an Initial Business Combination, subject to certain exceptions.
NOTE 5 — RELATED PARTIES
Founder Shares
On June 30, 2021, the Sponsor
received 2,875,000 of the Company’s Class B common stock (the “Founder Shares”) for $25,000 to be paid at a later date.
On October 11, 2021, the sponsor surrendered and forfeited 287,500 Founder Shares for no consideration, following which the Sponsor holds
2,587,500 Founder Shares. All share amounts have been retroactively restated to reflect this surrender. So that the number of Founder
Shares will equal, on an as-converted basis, approximately 20% of the Company’s issued and outstanding shares of common stock after
the Initial Public Offering.
The holders of the Founder
Shares have agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur
of: (A) one year after the completion of a Business Combination and (B) subsequent to a Business Combination, (x) if the last reported
sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations,
recapitalizations and the like) for any 20 trading days within any 30-trading day period following the consummation of a Business Combination,
or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results
in all of the Public Stockholders having the right to exchange their shares of common stock for cash, securities or other property.
Promissory Note — Related Party
On October 26, 2021, the
Sponsor issued an unsecured promissory note to the Company (the “Promissory Note”), pursuant to which the Company may borrow
up to an aggregate principal amount of $300,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) February
28, 2022 or (ii) the consummation of the Proposed Public Offering. As of December 31, 2023 and December 31, 2022, there was no amount
outstanding under the Promissory Note.
Advances from Related Parties
Affiliates of the Sponsor
advanced $1,000 to the Company for working capital. These advances are due on demand and are non-interest bearing. For the period from
June 9, 2021 (inception) through December 31, 2023, the related parties paid $329,783 on behalf of the Company. As of December 31, 2023
and December 31, 2022, there was $329,783 and $67,198 due to the related parties respectively.
General and Administrative Services
Commencing on the date the Units are first listed
on the Nasdaq, the Company has agreed to pay the Sponsor a total of $10,000 per month for office space, utilities and secretarial and
administrative support for up to 21 months. Upon completion of the Initial Business Combination or the Company’s liquidation,
the Company will cease paying these monthly fees. The administrative expense was $30,000 for the three-months ended December 30, 2023
and 2022. The administrative expense was $120,000 for the year ended December 31, 2023 and 2022.
Related Party Loans
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”). Such Working
Capital Loans would be evidenced by promissory notes. The notes may be repaid upon completion of a Business Combination, without interest,
or, at the lender’s discretion, up to $1,500,000 of the notes may be converted upon completion of a Business Combination into units
at a price of $10.00 per unit. Such units would be identical to the Private Placement Units. 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. As of December 31, 2023 and December 31, 2022, there were
$180,000 and $0 outstanding under the Working Capital Loans.
Extension Payment Deposit
On March 29, 2023, April
25, 2023, May 29, 2023, June 26, 2023, July 25, 2023, and August 23, 2023, the Company caused to be deposited $191,666 into the Company’s
Trust account for its public stockholders, allowing the Company to extend the period of time it has to consummate its initial business
combination by six months from March 29, 2023 to September 29, 2023. On September 29, October 26, November 29 and December 22, 2023,
it caused to be deposited $40,000 into the Company’s Trust account for its public stockholders, allowing the Company to extend
the period of time it has to consummate its initial business combination by four month from September 29, 2023 (the “Extension”).
The total extension payment the Company has deposited in the trust account is $1,309,996 as of December 31, 2023 and $0 as of December
31, 2022.
NOTE 6 — COMMITMENTS AND CONTINGENCIES
Registration Rights
The holders of the Founder
Shares, Private Placement Units and warrants that may be issued upon conversion of Working Capital Loans (and any shares of common stock
issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the Working Capital Loans and upon
conversion of the Founder Shares) will be entitled to registration rights pursuant to a registration rights agreement to be signed prior
to or on the effective date of Initial Public Offering requiring the Company to register such securities for resale (in the case of the
Founder Shares, only after conversion to shares of Class A common stock). The holders of these securities will be entitled to make up
to three demands, excluding short form registration demands, that the Company register such securities. In addition, the holders have
certain “piggy-back” registration rights with respect to registration statements filed subsequent to completion of a Business
Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. However,
the registration rights agreement provides that the Company will not be required to effect or permit any registration or cause any registration
statement to become effective until the securities covered thereby are released from their lock-up restrictions. The Company will bear
the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The Company granted the underwriters
a 45-day option from the date of Proposed Public Offering to purchase up to 1,350,000 additional Units to cover over-allotments, if any,
at the Proposed Public Offering price less the underwriting discounts and commissions. The underwriters exercised this option simultaneously
with close of the Initial Public Offering.
The underwriters were paid
a cash underwriting discount of $0.175 per Unit, or $1,811,250 (gross of a discount of $400,000), upon the closing of the Proposed Public
Offering. In addition, the underwriters are entitled to a deferred fee of $0.35 per Unit, or $3,622,500. The deferred fee will become
payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination,
subject to the terms of the underwriting agreement.
The underwriters also received
to 25,875 shares of Class A common stock upon the consummation of the IPO. The fair value of the shares issued to the underwriter was
$258,750.
NOTE 7 — STOCKHOLDER’S EQUITY
Preferred Stock
— The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share. As of December
31, 2023 and December 31, 2022 there were no shares of preferred stock issued or outstanding.
Class A Common Stock
— The Company is authorized to issue 100,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders
of Class A common stock are entitled to one vote for each share. As of December 31, 2023 and December 31 2022, there were 492,025 shares
of Class A common stock issued and outstanding. As of December 31, 2023 and December 31, 2022 there were 1,762,409 and 10,350,000 shares
of Class A common stock that were classified as temporary equity in the accompanying balance sheet.
Class B Common Stock
— The Company is authorized to issue 10,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders
of Class B common stock are entitled to one vote for each share. As of December 31, 2023 and December 31, 2022, there were 2,587,500 shares
of Class B common stock issued and outstanding.
Only holders of the Class
B common stock will have the right to vote on the election of directors prior to the Business Combination. Holders of Class A common stock
and holders of Class B common stock will vote together as a single class on all matters submitted to a vote of our shareholders except
as otherwise required by law. In connection with our initial business combination, we may enter into a stockholders agreement or other
arrangements with the stockholders of the target or other investors to provide for voting or other corporate governance arrangements that
differ from those in effect upon completion of the IPO.
The shares of Class B common
stock will automatically convert into Class A common stock at the time of a Business Combination, or earlier at the option of the holder,
on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities,
are issued or deemed issued in excess of the amounts issued in the Proposed Public Offering and related to the closing of a Business Combination,
the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders
of a majority of the then-outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance
or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock
will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon
the completion of Proposed Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued
in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business
Combination), excluding any shares or equity-linked securities issued or issuable to any seller of an interest in the target to us in
a Business Combination.
Warrants —
Public Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units
and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a
Business Combination and (b) 12 months from the closing of the Proposed Public Offering. The Public Warrants will expire five years after
the completion of a Business Combination or earlier upon redemption or liquidation.
The Company will not be obligated
to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant
exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common stock issuable
upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available,
subject to the Company satisfying its obligations with respect to registration, or a valid exemption from registration is available. 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 residence of the exercising holder, or an exemption from registration is available.
The Company has agreed that
as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, the Company will use
its commercially reasonable efforts to file, and within 60 business days following a Business Combination to have declared effective,
a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants and to maintain
a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed. Notwithstanding the above,
if the Class A common stock 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 Public 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, the Company will not be required to file or maintain in effect a registration
statement, but will use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent
an exemption is not available.
Redemption of Warrants
When the Price per Share of Class A Common Stock Equals or Exceeds $18.00 — Once the warrants become exercisable, the Company
may redeem the outstanding Public Warrants:
|
● |
in whole and not in part; |
|
● |
at a price of $0.01 per Public Warrant; |
|
● |
upon a minimum of 30 days’ prior written notice of redemption, or the 30-day redemption period to each warrant holder; and |
|
● |
if, and only if, the last reported sale price of the Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganization, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to warrant holders. |
If and when the warrants
become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying
securities for sale under all applicable state securities laws.
If the Company calls the
Public Warrants for redemption, as described above, its management will have the option to require any holder that wishes to exercise
the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of
common stock issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a stock
dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described below, the
Public Warrants will not be adjusted for issuances of common stock at a price below its exercise price. Additionally, in no event will
the Company be required to net cash settle the Public Warrants. If the Company is unable to complete a Business Combination within the
Combination Period and the Company liquidates the funds held in the Trust Account, holders of Public Warrants will not receive any of
such funds with respect to their Public Warrants, nor will they receive any distribution from the Company’s assets held outside
of the Trust Account with respect to such Public Warrants. Accordingly, the Public Warrants may expire worthless.
The Private Placement Warrants
will be identical to the Public Warrants underlying the Units being sold in the Initial Public Offering.
NOTE 8 — INCOME TAX
The
income tax provision consists of the following:
| |
Years Ended December 31, | | |
Years Ended December 31, | |
| |
2023 | | |
2022 | |
Federal | |
| | | |
| | |
Current | |
$ | 299,623 | | |
$ | 165,799 | |
Deferred | |
| — | | |
| — | |
State and Local | |
| | | |
| | |
Current | |
$ | — | | |
$ | — | |
Deferred | |
| — | | |
| — | |
Change in valuation allowance | |
| — | | |
| — | |
Income tax provision | |
$ | 299,623 | | |
$ | 165,799 | |
The Company’s net deferred
tax assets are as follows:
| |
Years Ended | | |
Years Ended | |
| |
December 31, | | |
December 31, | |
| |
2023 | | |
2022 | |
Deferred Tax Assets | |
| | |
| |
Sec. 195 Start-up Costs | |
$ | 232,741 | | |
$ | — | |
Acquisition Cost | |
| 8,452 | | |
| — | |
Total Deferred Tax Assets | |
| 241,193 | | |
| — | |
Deferred Tax Liability | |
| — | | |
| — | |
Unrealized gain on Investment in Trust Account | |
| — | | |
| — | |
Total Deferred Tax Assets | |
| — | | |
| — | |
Less: Valuation allowance | |
| (241,193 | ) | |
| — | |
Deferred Tax Assets, net of allowance | |
$ | — | | |
$ | | |
As
of December 31, 2023 and 2022, the Company had zero of U.S. federal and state net operating loss carryovers available to offset
future taxable income. The federal net operating losses can be carried forward indefinitely, subject to a limitation in utilization
against 80% of annual taxable income.
In
assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all
of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future
taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management
considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this
assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect
to future realization of deferred tax assets and therefore established a full valuation allowance of $241,193 and nil as
of December 31, 2023 and 2022.
A reconciliation of the
federal income tax rate to the Company’s effective tax rate is as follows:
| |
Years Ended | | |
Years Ended | |
| |
December 31, | | |
December 31, | |
| |
2023 | | |
2022 | |
Statutory federal income tax rate | |
| 21.00 | % | |
| 21.00 | % |
Permanent differences | |
| 0.17 | % | |
| (0.38 | )% |
Return to Accrual & Prior Year True Ups | |
| (17.85 | )% | |
| — | % |
Transaction costs allocated to warrant issuance | |
| — | % | |
| — | % |
Change in valuation allowance | |
| 13.69 | % | |
| (50.20 | )% |
Income tax provision | |
| 17.01 | % | |
| (29.58 | )% |
The
effective tax rate differs from the statutory tax rate of 21% for the year ended December 31, 2023 and 2022, due to the change in the
valuation allowance. The Company files income tax returns in the U.S. federal jurisdiction and is subject to examination by the various
taxing authorities. The Company’s tax return since inception remain open to examination by the taxing authorities. The Company considers
Delaware to be a significant state tax jurisdiction.
NOTE 9 — SUBSEQUENT EVENTS
The
Company evaluated subsequent events and transactions that occurred after the balance sheet date. Based upon this review, the Company did
not identify any other subsequent events that would have required adjustment to or disclosure in the financial statement.
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Pursuant to our amended and
restated certificate of incorporation, as amended (the “Charter”) our authorized capital stock consists of 100,000,000 shares
of Class A common stock, $0.0001 par value, 10,000,000 shares of Class B common stock, $0.0001 par value, and 1,000,000 shares of undesignated
preferred stock, $0.0001 par value. The following description summarizes the material terms of our capital stock. Because it is only a
summary, it may not contain all the information that is important to you.
Each unit has an offering
price of $10.00 and consists of one share of Class A common stock and one redeemable warrant. Each warrant entitles the holder to purchase
one share of common stock.
The Class A common stock
and warrants comprising the units began separate trading on February 11, 2022.
The placement units are identical
to the units sold in the IPO except that there will be no redemption rights with respect to the placement units, which will expire worthless
if we do not consummate a business combination within 24 months from the closing of the IPO (or up to 36 months from the closing of the
IPO, if we extend the period of time to consummate a business combination by 12 month extensions, subject to satisfaction of certain conditions,
including the deposit of the lesser of (x) $40,000 or (y) $0.04 per share for each public share that is not redeemed in connection with
the special meeting for each such one-month extension, into the trust account), as described in more detail in the Registration Statement,
or as extended by the Company’s stockholders in accordance with our Charter).
As of May 9, 2024, 1,762,409 shares of Class A ordinary shares, par value $0.0001 per share, and 2,587,500 shares of Class B ordinary shares,
$0.0001 par value per share, issued and outstanding.
Our sponsor purchased an
aggregate of 466,150 placement units at a price of $10.00 per unit, for an aggregate purchase price of $4,661,500. The initial stockholders
held an aggregate of approximately 70.2% of the issued and outstanding common stock following the IPO and the expiration of the underwriters’
over-allotment option.
Common stockholders of record
are entitled to one vote for each share held on all matters to be voted on by stockholders. Holders of the Class A common stock and holders
of the Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders, except as required
by law. Unless specified in our Charter or bylaws, or as required by applicable provisions of the DGCL or applicable stock exchange rules,
the affirmative vote of a majority of our shares of common stock that are voted is required to approve any such matter voted on by our
stockholders. Our board of directors are divided into three classes, each of which generally serve for a term of three years with only
one class of directors being elected in each year. There is no cumulative voting with respect to the election of directors, with the result
that the holders of more than 50% of the shares voted for the election of directors can elect all of the directors. Our stockholders are
entitled to receive ratable dividends when, as and if declared by the board of directors out of funds legally available therefor.
Because our Charter authorizes
the issuance of up to 100,000,000 shares of Class A common stock, if we were to enter into an initial business combination, we may (depending
on the terms of such an initial business combination) be required to increase the number of shares of Class A common stock which we are
authorized to issue at the same time as our stockholders vote on the initial business combination to the extent we seek stockholder approval
in connection with our initial business combination.
In accordance with Nasdaq
corporate governance requirements, we are not required to hold an annual meeting until no later than one year after our first fiscal year
end following our listing on Nasdaq. Under Section 211(b) of the DGCL, we are, however, required to hold an annual meeting of stockholders
for the purposes of electing directors in accordance with our bylaws, unless such election is made by written consent in lieu of such
a meeting. We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial business
combination, and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting. Therefore, if our
stockholders want us to hold an annual meeting prior to the consummation of our initial business combination, they may attempt to force
us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL.
We will provide our stockholders
with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share
price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation
of our initial business combination including interest earned on the funds held in the trust account and not previously released to us
to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in
the trust account is initially anticipated to be approximately $10.15 per public share. The per-share amount we will distribute to investors
who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. Our sponsor,
officers and directors will enter into a letter agreement with us, pursuant to which they will agree to waive their redemption rights
with respect to any founder shares, placement shares and any public shares held by them in connection with the completion of our initial
business combination. Unlike many blank check companies that hold stockholder votes and conduct proxy solicitations in conjunction with
their initial business combinations and provide for related redemptions of public shares for cash upon completion of such initial business
combinations even when a vote is not required by applicable law or stock exchange requirements, if a stockholder vote is not required
by law and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our Charter, conduct
the redemptions pursuant to the tender offer rules of the SEC, and file tender offer documents with the SEC prior to completing our initial
business combination. Our Charter will require these tender offer documents to contain substantially the same financial and other information
about the initial business combination and the redemption rights as is required under the SEC’s proxy rules. If, however, a stockholder
approval of the transaction is required by applicable law or stock exchange requirements, or we decide to obtain stockholder approval
for business or other legal reasons, we will, like many blank check companies, offer to redeem shares in conjunction with a proxy solicitation
pursuant to the proxy rules and not pursuant to the tender offer rules. If we seek stockholder approval, we will complete our initial
business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination.
A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the company
representing a majority of the voting power of all outstanding shares of capital stock of the company entitled to vote at such meeting.
The underwriters will have the same redemption rights as a public stockholder with respect to any public shares it acquires. The representative
has informed us that it has no current commitments, plans or intentions to acquire any public shares for its own account; however, if
they do acquire public shares, it will do so in the ordinary course of business in accordance with our Registration Statement. The underwriters
will not make any such purchases when in possession of any material nonpublic information not disclosed to the seller, during a restricted
period under Regulation M under the Exchange Act, in transactions that would violate Section 9(a)(2) or Rule 10(b)-5 under the Exchange
Act, or if prohibited by applicable state securities laws or broker-dealer regulations. To the extent our initial stockholders or purchasers
of placement units transfer any of these securities to certain permitted transferees, such permitted transferees will agree, as a condition
to such transfer, to waive these same redemption rights. Also, our sponsor purchased 466,150 placement units at the price of $10.00 per
unit in a private placement that occurred simultaneously with the completion of the IPO. If we submit our initial business combination
to our public stockholders for a vote, our sponsor, the other initial stockholders, our officers and our directors have agreed to vote
their respective founder shares, placement shares and any public shares held by them in favor of our initial business combination.
The participation of our
sponsor, officers, directors or their affiliates in privately-negotiated transactions (as described in the Registration Statement), if
any, could result in the approval of our initial business combination even if a majority of our public stockholders vote, or indicate
their intention to vote, against such business combination. For purposes of seeking approval of the majority of our outstanding shares
of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. We
intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required,
at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements
of our initial stockholders, may make it more likely that we will consummate our initial business combination.
If we seek stockholder approval
of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to
the tender offer rules, our Charter provides that a public stockholder, together with any affiliate of such stockholder or any other person
with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be
restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares of common stock sold in the IPO, which
we refer to as the Excess Shares. However, we would not be restricting our stockholders’ ability to vote all of their shares (including
Excess Shares) for or against our initial business combination. Our stockholders’ inability to redeem the Excess Shares will reduce
their influence over our ability to complete our initial business combination, and such stockholders could suffer a material loss in their
investment if they sell such Excess Shares on the open market. Additionally, such stockholders will not receive redemption distributions
with respect to the Excess Shares if we complete the initial business combination. And, as a result, such stockholders will continue to
hold that number of shares exceeding 15% and, in order to dispose such shares would be required to sell their stock in open market transactions,
potentially at a loss.
If we seek stockholder approval
in connection with our initial business combination, pursuant to the letter agreement our sponsor, officers and directors have agreed
to vote any founder shares and placement shares held by them and any public shares they may acquire during or after the IPO (including
in open market and privately negotiated transactions) in favor of our initial business combination. As a result, in addition to our initial
stockholders’ founder shares and placement shares, we would not need any of the public shares sold in the IPO to be voted in favor
of an initial business combination in order to have our initial business combination approved (assuming that the representative shares
are voted in favor of such initial business combination). Additionally, each public stockholder may elect to redeem its public shares
irrespective of whether they vote for or against the proposed transaction (subject to the limitation described in the preceding paragraph).
Pursuant to our Charter,
if we are unable to complete our initial business combination within 24 months from the closing of the IPO (or up to 36 months from the
closing of the IPO, if we extend the period of time to consummate a business combination by 12 month extensions, subject to satisfaction
of certain conditions, including the deposit of the lesser of (x) $40,000 or (y) $0.04 per share for each public share that is not redeemed
in connection with the special meeting for each such one-month extension, into the trust account), we 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 per-share price, payable in cash, equal to the aggregate amount then on deposit
in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes
(less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption
will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions,
if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of
our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to
our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Our sponsor, officers
and directors will enter into a letter agreement with us, pursuant to which they will agree to waive their rights to liquidating distributions
from the trust account with respect to any founder shares and placement shares held by them if we fail to complete our initial business
combination 24 months from the closing of the IPO (or up to 36 months from the closing of the IPO, if we extend the period of time to
consummate a business combination by 12 month extensions, subject to satisfaction of certain conditions, including the deposit of the
lesser of (x) $40,000 or (y) $0.04 per share for each public share that is not redeemed in connection with the special meeting for each
such one-month extension, into the trust account), as described in more detail in the Registration Statement, or as extended by the Company’s
stockholders in accordance with our Charter). However, if our initial stockholders acquire public shares in or after the IPO, they will
be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our 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, our stockholders 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 stock,
if any, having preference over the common stock. Our stockholders have no preemptive or other subscription rights. There are no sinking
fund provisions applicable to the common stock, except that we will provide our stockholders 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 our
initial business combination, subject to the limitations described herein.
The founder shares and placement
shares are identical to the shares of Class A common stock included in the units sold in the IPO, and holders of founder shares and placement
shares have the same stockholder rights as public stockholders, except that (i) the founder shares and placement shares are subject to
certain transfer restrictions, as described in more detail below, (ii) our sponsor, officers and directors have entered into a letter
agreement with us, pursuant to which they have agreed (A) to waive their redemption rights with respect to any founder shares, placement
shares and any public shares held by them in connection with the completion of our initial business combination, (B) to waive their redemption
rights with respect to their founder shares, placement shares and any public shares in connection with a stockholder vote to approve an
amendment to our Charter (x) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial
business combination within 24 months from the closing of the IPO (or up to 36 months from the closing of the IPO, if we extend the period
of time to consummate a business combination by 12 month extensions, subject to satisfaction of certain conditions, including the deposit
of the lesser of (x) $40,000 or (y) $0.04 per share for each public share that is not redeemed in connection with the special meeting
for each such one-month extension, into the trust account), or (y) with respect to any other provision relating to stockholders’
rights or pre-initial business combination activity and (C) to waive their rights to liquidating distributions from the trust account
with respect to any founder shares held by them if we fail to complete our initial business combination within 24 months from the closing
of the IPO (or up to 36 months from the closing of the IPO, if we extend the period of time to consummate a business combination by 12
month extensions, subject to satisfaction of certain conditions, including the deposit of the lesser of (x) $40,000 or (y) $0.04 per share
for each public share that is not redeemed in connection with the special meeting for each such one-month extension, into the trust account),
although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail
to complete our initial business combination within such time period, (iii) the founder shares are shares of our Class B common stock
that will automatically convert into shares of our Class A common stock at the time of the consummation of our initial business combination,
on a one-for-one basis, subject to adjustment as described herein, and (iv) are entitled to registration rights. If we submit our initial
business combination to our public stockholders for a vote, our sponsor, officers and directors have agreed pursuant to the letter agreement
to vote any founder shares and placement shares held by them and any public shares purchased during or after the IPO (including in open
market and privately negotiated transactions) in favor of our initial business combination. The placement shares will not be transferable,
assignable or saleable until 30 days after the consummation of our initial business combination except to permitted transferees.
The shares of Class B common
stock will automatically convert into shares of Class A common stock at the time of the consummation of our initial business combination
on a one-for-one basis (subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like), and
subject to further adjustment as provided herein. In the case that additional shares of Class A common stock, or equity-linked securities,
are issued or deemed issued in excess of the amounts offered in the Registration Statement and related to the closing of the initial business
combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless
the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance
or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock
will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon
completion of the IPO (excluding and the placement units and underlying securities) plus all shares of Class A common stock and equity-linked
securities issued or deemed issued in connection with the initial business combination (excluding any shares or equity-linked securities
issued, or to be issued, to any seller in the initial business combination, any private placement-equivalent units and their underlying
securities issued to our sponsor or its affiliates upon conversion of loans made to us). We cannot determine at this time whether a majority
of the holders of our Class B common stock at the time of any future issuance would agree to waive such adjustment to the conversion ratio.
They may waive such adjustment due to (but not limited to) the following: (i) closing conditions which are part of the agreement for our
initial business combination; (ii) negotiation with Class A stockholders on structuring an initial business combination; or (iii) negotiation
with parties providing financing which would trigger the anti-dilution provisions of the Class B common stock. If such adjustment is not
waived, the issuance would not reduce the percentage ownership of holders of our Class B common stock, but would reduce the percentage
ownership of holders of our Class A common stock. If such adjustment is waived, the issuance would reduce the percentage ownership of
holders of both classes of our common stock. The term “equity-linked securities” refers to any debt or equity securities that
are convertible, exercisable or exchangeable for shares of Class A common stock issues in a financing transaction in connection with our
initial business combination, including but not limited to a private placement of equity or debt. Securities could be “deemed issued”
for purposes of the conversion rate adjustment if such shares are issuable upon the conversion or exercise of convertible securities,
warrants or similar securities.
With certain limited exceptions,
the founder shares are not transferable, assignable or saleable (except to our officers and directors and other persons or entities affiliated
with our sponsor, each of whom will be subject to the same transfer restrictions) until the earlier to occur of: (A) six months after
the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the reported last sale
price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations,
recapitalizations and the like) for any 20 trading days within any 30-trading day period following the consummation of our initial business
combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction
that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property.
Our Charter provides that
shares of preferred stock may be issued from time to time in one or more series. Our board of directors will be authorized to fix the
voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights and any qualifications,
limitations and restrictions thereof, applicable to the shares of each series. Our board of directors will be able to, without stockholder
approval, issue preferred stock with voting and other rights that could adversely affect the voting power and other rights of the holders
of the common stock and could have anti-takeover effects. The ability of our board of directors to issue preferred stock without stockholder
approval could have the effect of delaying, deferring or preventing a change of control of us or the removal of existing management. We
have no preferred stock outstanding at the date hereof. Although we do not currently intend to issue any shares of preferred stock, we
cannot assure you that we will not do so in the future. No shares of preferred stock were being issued or registered in the IPO.
Each warrant entitles the
registered holder to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as discussed
below, at any time commencing on the later of 12 months from the closing of the IPO and 30 days after the completion of our initial business
combination.
The warrants will expire
five years after the completion of our initial business combination, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation.
We will not be obligated
to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant
exercise unless a registration statement under the Securities Act with respect to the shares of Class A common stock underlying the warrants
is then effective and a prospectus relating thereto is current, subject to our satisfying our obligations described below with respect
to registration. No warrant will be exercisable and we will not be obligated to issue shares of Class A common stock upon exercise of
a warrant unless Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under
the securities laws of the state of residence of the registered holder of the warrants. In the event that the conditions in the two immediately
preceding sentences are not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant
and such warrant may have no value and expire worthless. In no event will we be required to net cash settle any warrant. In the event
that a registration statement is not effective for the exercised warrants, the purchaser of a unit containing such warrant will have paid
the full purchase price for the unit solely for the share of Class A common stock underlying such unit.
We are not registering the
shares of Class A common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable,
but in no event later than 20 business days after the closing of our initial business combination, we will use our best efforts to file
with the SEC a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants, to cause such
registration statement to become effective and to maintain a current prospectus relating to those shares of Class A common stock until
the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the shares of Class A
common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our
initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period
when we will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance
with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the foregoing, if a registration statement covering the
Class A common stock issuable upon exercise of the warrants is not effective within a specified period following the consummation of our
initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period
when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption
provided by Section 3(a)(9) of the Securities Act of 1933, as amended, or the Securities Act, provided that such exemption is available.
If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis.
If and when the warrants
become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants
is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or
qualification. We will use our best efforts to register or qualify such shares of common stock under the blue-sky laws of the state of
residence in those states in which the warrants were offered by us in the IPO.
We have established the last
of the redemption criterion discussed above to prevent a redemption call unless there is at the time of the call a significant premium
to the warrant exercise price. If the foregoing conditions are satisfied and we issue a notice of redemption of the warrants, each warrant
holder will be entitled to exercise its warrant prior to the scheduled redemption date. However, the price of the Class A common stock
may fall below the $18.00 redemption trigger price (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations
and the like) as well as the $11.50 warrant exercise price after the redemption notice is issued.
If we call the warrants for
redemption as described above, our management will have the option to require any holder that wishes to exercise its warrant to do so
on a “cashless basis.” In determining whether to require all holders to exercise their warrants on a “cashless basis,”
our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect
on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our warrants. If our
management takes advantage of this option, all holders of warrants would pay the exercise price by surrendering their warrants for that
number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A
common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “fair market
value” (defined below) by (y) the fair market value. The “fair market value” for this purpose shall mean the average
reported last sale price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which
the notice of redemption is sent to the holders of warrants. If our management takes advantage of this option, the notice of redemption
will contain the information necessary to calculate the number of shares of Class A common stock to be received upon exercise of the warrants,
including the “fair market value” in such case. Requiring a cashless exercise in this manner will reduce the number of shares
to be issued and thereby lessen the dilutive effect of a warrant redemption. We believe this feature is an attractive option to us if
we do not need the cash from the exercise of the warrants after our initial business combination. If we call our warrants for redemption
and our management does not take advantage of this option, our sponsor and its permitted transferees would still be entitled to exercise
their placement warrants for cash or on a cashless basis using the same formula described above that they and the other warrant holders
would have been required to use had all warrant holders been required to exercise their warrants on a cashless basis, as described in
more detail below.
A holder of a warrant may
notify us in writing in the event it elects to be subject to a requirement that such holder will not have the right to exercise such warrant,
to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the warrant agent’s
actual knowledge, would beneficially own in excess of 4.9% or 9.8% (or such other amount as a holder may specify) of the shares of Class
A common stock outstanding immediately after giving effect to such exercise.
If the number of outstanding
shares of Class A common stock is increased by a stock dividend payable in shares of Class A common stock, or by a split-up of shares
of Class A common stock or other similar event, then, on the effective date of such stock dividend, split-up or similar event, the number
of shares of Class A common stock issuable on exercise of each whole warrant will be increased in proportion to such increase in the outstanding
shares of Class A common stock. A rights offering to holders of Class A common stock entitling holders to purchase shares of Class A common
stock at a price less than the fair market value will be deemed a stock dividend of a number of shares of Class A common stock equal to
the product of (i) the number of shares of Class A common stock actually sold in such rights offering (or issuable under any other equity
securities sold in such rights offering that are convertible into or exercisable for Class A common stock) and (ii) one (1) minus the
quotient of (x) the price per share of Class A common stock paid in such rights offering divided by (y) the fair market value. For these
purposes (i) if the rights offering is for securities convertible into or exercisable for Class A common stock, in determining the price
payable for Class A common stock, there will be taken into account any consideration received for such rights, as well as any additional
amount payable upon exercise or conversion and (ii) fair market value means the volume weighted average price of Class A common stock
as reported during the ten (10) trading day period ending on the trading day prior to the first date on which the shares of Class A common
stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.
In addition, if we, at any
time while the warrants are outstanding and unexpired, pay a dividend or make a distribution in cash, securities or other assets to the
holders of Class A common stock on account of such shares of Class A common stock (or other shares of our capital stock into which the
warrants are convertible), other than (a) as described above, (b) certain ordinary cash dividends, (c) to satisfy the redemption rights
of the holders of Class A common stock in connection with a proposed initial business combination, (d) to satisfy the redemption rights
of the holders of Class A common stock in connection with a stockholder vote to amend our Charter (i) to modify the substance or timing
of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto
or to redeem 100% of our Class A common stock if we do not complete our initial business combination within 24 months from the closing
of the IPO (or up to 36 months from the closing of the IPO, if we extend the period of time to consummate a business combination by 12
month extensions, subject to satisfaction of certain conditions, including the deposit of the lesser of (x) $40,000 or (y) $0.04 per share
for each public share that is not redeemed in connection with the special meeting for each such one-month extension, into the trust account),
or (ii) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity, or (e)
in connection with the redemption of our public shares upon our failure to complete our initial business combination, then the warrant
exercise price will be decreased, effective immediately after the effective date of such event, by the amount of cash and/or the fair
market value of any securities or other assets paid on each share of Class A common stock in respect of such event.
If the number of outstanding
shares of our Class A common stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of
Class A common stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification
or similar event, the number of shares of Class A common stock issuable on exercise of each warrant will be decreased in proportion to
such decrease in outstanding shares of Class A common stock.
Whenever the number of shares
of Class A common stock purchasable upon the exercise of the warrants is adjusted, as described above, the warrant exercise price will
be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will
be the number of shares of Class A common stock purchasable upon the exercise of the warrants immediately prior to such adjustment, and
(y) the denominator of which will be the number of shares of Class A common stock so purchasable immediately thereafter.
In case of any reclassification
or reorganization of the outstanding shares of Class A common stock (other than those described above or that solely affects the par value
of such shares of Class A common stock), or in the case of any merger or consolidation of us with or into another corporation (other than
a consolidation or merger in which we are the continuing corporation and that does not result in any reclassification or reorganization
of our outstanding shares of Class A common stock), or in the case of any sale or conveyance to another corporation or entity of the assets
or other property of us as an entirety or substantially as an entirety in connection with which we are dissolved, the holders of the warrants
will thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the warrants and
in lieu of the shares of our Class A common stock immediately theretofore purchasable and receivable upon the exercise of the rights represented
thereby, the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification,
reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the warrants would
have received if such holder had exercised their warrants immediately prior to such event.
The warrants will be issued
in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. You should
review a copy of the warrant agreement, which was filed as an exhibit to the registration statement, for a complete description of the
terms and conditions applicable to the warrants. The warrant agreement provides that the terms of the warrants may be amended without
the consent of any holder to cure any ambiguity or correct any mistake, including to conform the provisions of the warrant agreement to
the description of the terms of the warrants and the warrant agreement set forth in the Registration Statement, or 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.
In addition, if (x) we issue
additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our
initial business combination at a Newly Issued Price of less than $9.20 per share of Class A common stock (with such issue price or effective
issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates,
without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance), (y) the
aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for
the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions),
and (z) the Market Value is below $9.20 per share, then the exercise price of the warrants will be adjusted (to the nearest cent) to be
equal to 115% of the greater of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described
above will be adjusted (to the nearest cent) to be equal to 180% of the greater of the Market Value and the Newly Issued Price.
The warrants may be exercised
upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form
on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price
(or on a cashless basis, if applicable), by certified or official bank check payable to us, for the number of warrants being exercised.
The warrant holders do not have the rights or privileges of holders of Class A common stock and any voting rights until they exercise
their warrants and receive shares of Class A common stock. After the issuance of shares of Class A common stock upon exercise of the warrants,
each holder will be entitled to one (1) vote for each share held of record on all matters to be voted on by stockholders.
No fractional shares will
be issued upon exercise of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest
in a share, we will, upon exercise, round down to the nearest whole number of shares of Class A common stock to be issued to the warrant
holder.
We have agreed that, subject
to applicable law, any action, proceeding or claim against us arising out of or relating in any way to the warrant agreement will be brought
and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and we
irrevocably submit to such jurisdiction, which jurisdiction will be the exclusive forum for any such action, proceeding or claim. This
provision does not apply to claims under the Exchange Act or any claim for which the federal district courts of the United States of America
are the sole and exclusive forum. In addition, unless we consent in writing to the selection of an alternative forum, the federal district
courts of the United States of America shall, to the full extent permitted by law, be the exclusive forum for the resolution of any complaint
asserting a cause of action arising under the Securities Act or the rules and regulations promulgated thereunder.
Except as described below,
the placement warrants have terms and provisions that are identical to those of the warrants sold as part of the units in the IPO, including
as to exercise price, exercisability, redemption, and exercise period. The placement warrants (including the Class A common stock issuable
upon exercise of the placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial
business combination (except, among other limited exceptions as described in our Registration Statement).
In addition, holders of our
placement warrants are entitled to certain registration rights.
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 officers
and directors may, but are not obligated to, loan us funds as may be required. Up to $1,500,000 of such loans may be convertible into
units, at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination. The units would
be identical to the placement units. However, as the units would not be issued until consummation of our initial business combination,
any warrants underlying such units would not be able to be voted on an amendment to the warrant agreement in connection with such business
combination.
We may also receive loans
from our sponsor to finance any extension of the deadline for consummating the initial business combination. The sponsor would receive
a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the even that we
are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would be repaid
upon consummation of our initial business combination, or all, or any portion, of such loans may be convertible into units, at a price
of $10.00 per unit at the option of the sponsor, upon consummation of our initial business combination. The units would be identical to
the placement units.
Our sponsor has agreed not
to transfer, assign or sell any of the placement warrants (including the Class A common stock issuable upon exercise of any of these warrants)
until the date that is 30 days after the date we complete our initial business combination, except that, among other limited exceptions
as described under the section of the Registration Statement entitled “Principal Stockholders — Restrictions on Transfers
of Founder Shares and Placement Warrants” made to our officers and directors and other persons or entities affiliated with our sponsor.
We have not paid any cash
dividends on our common stock to date and do not intend to pay cash dividends prior to the completion of an initial business combination.
The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general
financial conditions subsequent to completion of an initial business combination. The payment of any cash dividends subsequent to an initial
business combination will be within the discretion of our board of directors at such time. Further, if we incur any indebtedness, our
ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith.
The transfer agent for our
common stock and warrant agent for our warrants is Continental Stock Transfer & Trust Company. We have agreed to indemnify Continental
Stock Transfer & Trust Company in its roles as transfer agent and warrant agent, its agents and each of its stockholders, directors,
officers and employees against all claims and losses that may arise out of acts performed or omitted for its activities in that capacity,
except for any liability due to any gross negligence, willful misconduct or bad faith of the indemnified person or entity.
Our Charter contains certain
requirements and restrictions relating to the IPO that will apply to us until the completion of our initial business combination. These
provisions cannot be amended without the approval of the holders of at least 65% of our common stock. Our initial stockholders, who will
collectively beneficially own approximately 70.2% of our common stock upon the closing of the IPO (including the placement shares to be
issued to the sponsor and assuming they do not purchase any units in the IPO), will participate in any vote to amend our Charter and will
have the discretion to vote in any manner they choose. Specifically, our Charter provides, among other things, that:
In addition, our Charter
provides that under no circumstances will we redeem our public shares unless our net tangible assets are at least $5,000,001 either immediately
prior to or upon consummation of our initial business combination and after payment of underwriters’ fees and commissions.
We are subject to the provisions
of Section 203 of the DGCL regulating corporate takeovers. This statute prevents certain Delaware corporations, under certain circumstances,
from engaging in a “business combination” with:
Our Charter provides that
our board of directors will be classified into three classes of directors. As a result, in most circumstances, a person can gain control
of our board only by successfully engaging in a proxy contest at two or more annual meetings.
Our Charter provides that
prior to the closing of the initial Business Combination, the holders of Class B Common Stock shall have the exclusive right to elect
and remove, with or without cause, any director, and the holders of Class A Common Stock shall have no right to vote on the election or
removal of any director. This provision shall be amended only by a resolution passed by holders of at least 90% of the outstanding Common
Stock voting thereon.
Our authorized but unissued
common stock and preferred stock are available for future issuances without stockholder approval and could be utilized for a variety of
corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of
authorized but unissued and unreserved common stock and preferred stock could render more difficult or discourage an attempt to obtain
control of us by means of a proxy contest, tender offer, merger or otherwise.
Our Charter requires, to
the fullest extent permitted by law, that derivative actions brought in our name, actions against directors, officers and employees for
breach of fiduciary duty and certain other actions may be brought only in the Court of Chancery in the State of Delaware, except any action
(A) as to which the Court of Chancery in the State of Delaware determines that there is an indispensable party not subject to the jurisdiction
of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten
days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery
or (C) for which the Court of Chancery does not have subject matter jurisdiction. If an action is brought outside of Delaware, the stockholder
bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel. Although we believe this
provision benefits us by providing increased consistency in the application of law in the types of lawsuits to which it applies, a court
may determine that this provision is unenforceable, and to the extent it is enforceable, the provision may have the effect of discouraging
lawsuits against our directors and officers.
Our Charter provides that
the exclusive forum provision will be applicable to the fullest extent permitted by applicable law, subject to certain exceptions. Section
27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange
Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any
duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. In addition,
our Charter provides that, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United
States of America shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting
a cause of action arising under the Securities Act, or the rules and regulations promulgated thereunder. We note, however, that there
is uncertainty as to whether a court would enforce this provision and that investors cannot waive compliance with the federal securities
laws and the rules and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for state and federal
courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.
Our bylaws provide that special
meetings of our stockholders may be called only by a majority vote of our board of directors, by our Chief Executive Officer or by our
Chairman.
Our bylaws provide that stockholders
seeking to bring business before our annual meeting of stockholders, or to nominate candidates for election as directors at our annual
meeting of stockholders, must provide timely notice of their intent in writing. To be timely, a stockholder’s notice will need to
be received by the company secretary at our principal executive offices not later than the close of business on the 90th day
nor earlier than the opening of business on the 120th day prior to the anniversary date of the immediately preceding annual
meeting of stockholders. Pursuant to Rule 14a-8 of the Exchange Act, proposals seeking inclusion in our annual proxy statement must comply
with the notice periods contained therein. Our bylaws also specify certain requirements as to the form and content of a stockholders’
meeting. These provisions may preclude our stockholders from bringing matters before our annual meeting of stockholders or from making
nominations for directors at our annual meeting of stockholders.
Any action required or permitted
to be taken by our common stockholders must be effected by a duly called annual or special meeting of such stockholders and may not be
effected by written consent of the stockholders other than with respect to our Class B common stock.
Our board of directors are
divided into three classes, Class I, Class II and Class III, with members of each class serving staggered three-year terms. Our Charter
provides that the authorized number of directors may be changed only by resolution of the board of directors. Subject to the terms of
any preferred stock, any or all of the directors may be removed from office at any time, but only for cause and only by the affirmative
vote of holders of a majority of the voting power of all then outstanding shares of our capital stock entitled to vote generally in the
election of directors, voting together as a single class. Any vacancy on our board of directors, including a vacancy resulting from an
enlargement of our board of directors, may be filled only by vote of a majority of our directors then in office.
For so long as any shares
of Class B common stock remain outstanding, we may not, without the prior vote or written consent of the holders of a majority of the
shares of Class B common stock then outstanding, voting separately as a single class, amend, alter or repeal any provision of our Charter,
whether by merger, consolidation or otherwise, if such amendment, alteration or repeal would alter or change the powers, preferences or
relative, participating, optional or other or special rights of the Class B common stock. Any action required or permitted to be taken
at any meeting of the holders of Class B common stock may be taken without a meeting, without prior notice and without a vote, if a consent
or consents in writing, setting forth the action so taken, shall be signed by the holders of the outstanding Class B common stock having
not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares of
Class B common stock were present and voted.
As of December 31, 2023,
we had 4,349,909 shares of common stock outstanding. Of these shares, the 1,762,409 shares sold in the IPO will be freely tradable without restriction or further registration under the Securities Act, except for any shares purchased
by one of our affiliates within the meaning of Rule 144 under the Securities Act. All of the remaining 2,587,500 founder shares, all 466,150
placement units, are restricted securities under Rule 144, in that they were issued in private transactions not involving a public offering,
and the shares of Class B common stock and placement units are subject to transfer restrictions as set forth in the Registration Statement.
These restricted securities will be entitled to registration rights as more fully described below under “— Registration Rights.”
Pursuant to Rule 144, a person
who has beneficially owned restricted shares of our common stock or warrants for at least six months would be entitled to sell their securities
provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the three months
preceding, a sale and (ii) we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale
and have filed all required reports under Section 13 or 15(d) of the Exchange Act during the 12 months (or such shorter period as we were
required to file reports) preceding the sale.
Persons who have beneficially
owned restricted shares of our common stock or warrants for at least six months but who are our affiliates at the time of, or at any time
during the three months preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell
within any three-month period only a number of securities that does not exceed the greater of:
Sales by our affiliates under
Rule 144 are also limited by manner of sale provisions and notice requirements and to the availability of current public information about
us.
Rule 144 is not available
for the resale of securities initially issued by shell companies (other than business combination related shell companies) or issuers
that have been at any time previously a shell company. However, Rule 144 also includes an important exception to this prohibition if the
following conditions are met:
As a result, our initial
stockholders will be able to sell their founder shares and placement units (including component securities contained therein), as applicable,
pursuant to Rule 144 without registration one year after we have completed our initial business combination.
The holders of the founder
shares, placement units (including component securities contained therein) and units (including securities contained therein) that may
be issued upon conversion of working capital loans, any shares of Class A common stock issuable upon the exercise of the placement warrants
and any shares of Class A common stock and warrants (and underlying Class A common stock) that may be issued upon conversion of the units
issued as part of the working capital loans and Class A common stock issuable upon conversion of the founder shares, are entitled to registration
rights pursuant to a registration rights agreement signed prior to or on the effective date of the IPO, requiring us to register such
securities for resale (in the case of the founder shares, only after conversion to our Class A common stock). The holders of the majority
of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition,
the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to our
completion of our initial business combination and rights to require us to register for resale such securities pursuant to Rule 415 under
the Securities Act. The registration rights agreement does not contain liquidated damages or other cash settlement provisions resulting
from delays in registering our securities. We will bear the expenses incurred in connection with the filing of any such registration statements.
We will bear the expenses incurred in connection with the filing of any such registration statements.
We have listed our units,
Class A common stock and warrants on Nasdaq under the symbols “AOGOU,” “AOGO” and “AOGOW,” respectively.
In connection with the Annual Report of Arogo
Capital Acquisition Corp. (the “Company”) on Form 10-K for the year ended December 31, 2023, as filed with the Securities
and Exchange Commission (the “Report”), I, Suradech Taweesaengsakulthai, Chief Executive Officer of the Company, certify,
pursuant to 18 U.S.C. §1350, as added by §906 of the Sarbanes-Oxley Act of 2002, that:
In connection with the Annual Report of Arogo
Capital Acquisition Corp. (the “Company”) on Form 10-K for the year ended December 31, 2023, as filed with the Securities
and Exchange Commission (the “Report”), I, Suthee Chivaphongse, Chief Financial Officer of the Company, certify, pursuant
to 18 U.S.C. §1350, as added by §906 of the Sarbanes-Oxley Act of 2002, that: