UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
ACT OF 1934
For the quarterly period ended
or
For the transition period from to
Commission File Number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction | (IRS Employer |
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(Address of principal executive offices) | (Zip Code) |
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Registrant’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 |
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Securities registered pursuant to section 12(g) of the Act: None
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 preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
☒ 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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). ☒ 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 an emerging growth company. See the definition of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act.:
Large accelerated filer ☐ | Accelerated filer ☐ |
Smaller reporting company | |
| Emerging growth company |
If an emerging growth company, indicate by the check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 13(a) of the Exchange Act.
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
YES
As of November 14, 2022, there were
LATAMGROWTH SPAC
Form 10-Q for the Quarter Ended September 30, 2022
Table of Contents
PART I. FINANCIAL INFORMATION
Item 1. | Financial Statements |
LATAMGROWTH SPAC
CONDENSED BALANCE SHEETS
| September 30, 2022 |
| December 31, | |||
(Unaudited) | 2021 | |||||
Assets |
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Current Assets: |
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Cash | $ | | $ | — | ||
Prepaid expenses |
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Total Current Assets |
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Marketable securities held in Trust Account |
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Deferred offering costs |
| — |
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Total Assets | $ | | $ | | ||
Liabilities, Redeemable Ordinary Shares and Shareholders’ Deficit |
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Current Liabilities: |
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Accounts payable and accrued expenses | $ | | $ | | ||
Promissory note - related party |
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Total Current Liabilities |
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Warrant liabilities |
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Deferred underwriting commissions |
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Total Liabilities |
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Commitments and Contingencies (Note 6) |
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Class A ordinary shares subject to possible redemption, |
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Shareholders’ Deficit: |
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Preference shares, $ |
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Class A ordinary shares, $ |
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Class B ordinary shares, $ |
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Additional paid-in capital |
| — |
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Accumulated deficit |
| ( |
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Total Shareholders’ Deficit |
| ( |
| ( | ||
Total Liabilities, Redeemable Ordinary Shares and Shareholders’ Deficit | $ | | $ | | ||
(1)
The accompanying notes are an integral part of these condensed financial statements.
1
LATAMGROWTH SPAC
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
For the period from | ||||||||||||
May 20, 2021 | ||||||||||||
For the three | For the nine | For the three | (Inception) | |||||||||
months ended | months ended | months ended | through | |||||||||
| September 30, 2022 |
| September 30, 2022 |
| September 30, 2021 |
| September 30, 2021 | |||||
Formation and operating costs | $ | | $ | | $ | | $ | | ||||
Loss from operations |
| ( |
| ( | ( |
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Other (expense) income: |
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Gain (loss) on change in fair value of warrants |
| ( |
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Gain on expiration of overallotment option |
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| — | |||||
Trust interest income |
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| — | |||||
Warrant issuance costs |
| — |
| ( | — |
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Total other (expense) income, net |
| ( |
| | — |
| — | |||||
Net (loss) income | $ | ( | $ | | $ | ( | $ | ( | ||||
Basic and diluted weighted average shares outstanding of Class A ordinary shares subject to possible redemption |
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| — | |||||
Basic and diluted net (loss) income per share, Class A ordinary shares subject to possible redemption | ( | | — | — | ||||||||
Basic and diluted weighted average shares outstanding of Class B ordinary shares |
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Basic and diluted net (loss) income per share, Class B ordinary shares | ( | | ( | ( | ||||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
2
LATAMGROWTH SPAC
UNAUDITED CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022
Total | ||||||||||||||
Class B | Additional | Accumulated | Shareholders’ | |||||||||||
| Shares |
| Amount |
| Paid-In Capital |
| Deficit |
| Deficit | |||||
Balance as of December 31, 2021 |
| | $ | | $ | | $ | ( | $ | ( | ||||
Excess cash received over fair value of private placement warrants |
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Forfeiture of |
| ( |
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Remeasurement of Class A ordinary shares to redemption amount | — | — | ( | ( | ( | |||||||||
Net income |
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| — |
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Balance as of March 31, 2022 (unaudited) |
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Remeasurement of Class A ordinary shares to redemption amount | — | — | — | ( | ( | |||||||||
Net income | — | — | — | | | |||||||||
Balance as of June 30, 2022 (unaudited) | | | — | ( | ( | |||||||||
Remeasurement of Class A ordinary shares to redemption amount | — | — | — | ( | ( | |||||||||
Net loss | — | — | — | ( | ( | |||||||||
Balance as of September 30, 2022 (unaudited) | | $ | | $ | — | $ | ( | $ | ( | |||||
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021 AND FOR THE PERIOD FROM MAY 20, 2021 (INCEPTION) THROUGH SEPTEMBER 30, 2021
Total | ||||||||||||||
Class B | Additional | Accumulated | Shareholders’ | |||||||||||
| Shares |
| Amount |
| Paid-In Capital |
| Deficit |
| Deficit | |||||
Balance as of May 20, 2021 (inception) | | $ | | $ | | $ | | $ | | |||||
Class B ordinary shares issued to Sponsor for payment of offering costs |
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Net loss |
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Balance as of June 30, 2021 (unaudited) |
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Net loss | — | — | — | ( | ( | |||||||||
Balance as of September 30, 2021 (unaudited) | | $ | | $ | | $ | ( | $ | ( | |||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
3
LATAMGROWTH SPAC
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
For the period from | ||||||
May 20, 2021 | ||||||
For the nine | (Inception) | |||||
months ended | through | |||||
| September 30, 2022 |
| September 30, 2021 | |||
Cash flows from operating activities: | ||||||
Net income (loss) | $ | | $ | ( | ||
Adjustments to reconcile net income (loss) to net cash used in operating activities: |
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Interest earned on marketable securities held in Trust Account |
| ( |
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Warrant issuance costs |
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Unrealized gain on change in fair value of warrants |
| ( |
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Gain on expiration of overallotment option |
| ( |
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Changes in operating assets and liabilities: |
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Prepaid expenses |
| ( |
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Accounts payable and accrued expenses |
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Net cash used in operating activities |
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Cash flows from investing Activities: |
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Principal deposited in Trust Account |
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Net cash used in investing activities |
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Cash flows from financing Activities: |
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Proceeds from initial public offering, net of underwriters’ discount |
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Proceeds from private placement |
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Payment of Sponsor promissory note |
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Payment of deferred offering costs |
| ( |
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Net cash provided by financing activities |
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Net change in cash |
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Cash, beginning of the period |
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Cash, end of the period | $ | | $ | | ||
Supplemental disclosure of cash flow information: |
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Deferred offering costs included in accounts payable and accrued offering costs and expenses | $ | | $ | | ||
Deferred offering costs paid by Sponsor in exchange for issuance of Class B ordinary shares | $ | — | $ | | ||
Remeasurement of Class A ordinary shares to redemption amount | $ | | $ | — | ||
Deferred underwriting commissions payable charged to additional paid in capital | $ | | $ | — | ||
Deferred offering costs charged to additional paid in capital | $ | | $ | — | ||
Forfeiture of | $ | | $ | — | ||
Initial fair value of warrant liability | $ | | $ | — | ||
Deferred offering costs charged to accumulated deficit | $ | | $ | — | ||
The accompanying notes are an integral part of these unaudited condensed financial statements.
4
LATAMGROWTH SPAC
NOTES TO CONDENSED FINANCIAL STATEMENTS
Note 1—Organization and Business Operation
LatAmGrowth SPAC (the “Company”) was incorporated as a Cayman Islands exempted company on May 20, 2021. The Company was incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (the “Business Combination”). The Company has not selected any Business Combination target. The Company will not be limited to a particular industry or geographic region in its identification and acquisition of a target company, but the Company intends to focus its search on high growth companies in Latin America, including Brazil, as well as businesses located in the United States that cater to the Hispanic community: (1) with significant technological advantages, and/or (2) that are well positioned to benefit from the favorable structural and secular trends of the emerging middle class.
As of September 30, 2022, the Company had not commenced any operations. All activity for the period from May 20, 2021 (inception) through September 30, 2022 relates to the Company’s formation and IPO 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 on cash and cash equivalents from the proceeds derived from the IPO (as defined below). The Company has selected December 31 as its fiscal year end.
The Company’s Sponsor is LatAmGrowth Sponsor LLC, a Delaware limited liability company (the “Sponsor”).
The registration statement for the Company’s initial public offering was declared effective on January 24, 2022 (the “Effective Date”). On January 27, 2022, the Company consummated the Public Offering of
Simultaneously with the closing of the IPO, the Company consummated the sale of
Transaction costs amounted to $
The Company must complete one or more Business Combinations having an aggregate fair market value of at least
Following the closing of the IPO on January 27, 2022, an amount of $
5
The Company will provide its public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of the initial Business Combination either (i) in connection with a general meeting called to approve the initial Business Combination or (ii) without a shareholder vote by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a proposed initial Business Combination or conduct a tender offer will be made by the Company, solely in its discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require the Company to seek shareholder approval under applicable law or stock exchange listing requirements.
The shareholders will be entitled to redeem their shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated 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 the Company to pay its taxes, divided by the number of then outstanding public shares, subject to the limitations and on conditions described in the Prospectus. The amount in the Trust Account is initially anticipated to be $
Ordinary shares subject to redemption are recorded at redemption value and classified as temporary equity following the completion of the IPO, in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.”
The Company will have
The Sponsor and each member of the management team have agreed to (i) waive their redemption rights with respect to their founder shares and public shares in connection with the completion of the initial Business Combination; (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to approve an amendment to the Company’s amended and restated memorandum and articles of association (A) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the initial Business Combination or to redeem
The Sponsor has agreed that it will be liable to the Company if and to the extent any claims by a third party (other than Marcum LLP, the Company’s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or other similar agreement or Business Combination agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $
6
$
Liquidity and Going Concern Considerations
As of September 30, 2022, the Company had $
On January 27, 2022, the Company consummated its IPO of
The Company believes that the $
The Company can raise additional capital through Working Capital Loans from the Sponsor, an affiliate of the Sponsor, certain of the Company’s officers and directors, or through loans from third parties. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of its business plan, and reducing overhead expenses. The Company cannot provide assurance that new financing will be available to it on commercially acceptable terms, if at all.
The Company has until April 27, 2023 (with optional three-month extension periods up to October 27, 2023 which are conditional upon securing additional funding from the Sponsor) to consummate a business combination. It is uncertain that the Company will be able to consummate a business combination by April 27, 2023 or obtain additional funding to extend the deadline for consummating a business combination. The Company cannot provide assurance that the required funding will be made available to the Company to allow it to extend the business combination period beyond April 27, 2023. If a business combination is not consummated by the required date and the Company is unable to obtain the funding to extend the business combination period beyond the initial deadline, there will be a mandatory liquidation and subsequent dissolution. In connection with the Company’s assessment of going concern considerations in accordance with the authoritative guidance in FASB ASU 2014-15, management has determined that mandatory liquidation, and subsequent dissolution, should the Company be unable to complete a business combination, raises substantial doubt about the Company’s ability to continue as a going concern for the next twelve months from the issuance of these unaudited condensed financial statements.
Risks and Uncertainties
Management is currently evaluating the impact of the COVID-19 pandemic and Russia-Ukraine war and has concluded that while it is reasonably possible that the virus and war could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these unaudited condensed financial statements. The unaudited condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.
7
Consideration of IR Act Excise Tax
On August 16, 2022, the Inflation Reduction Act of 2022 (the "IR Act") was signed into federal law. The IR Act provides for, among other things, a new U.S. federal 1% excise tax on certain repurchases of stock by publicly traded U.S. domestic corporations and certain U.S. domestic subsidiaries of publicly traded foreign corporations occurring on or after January 1, 2023. The excise tax is imposed on the repurchasing corporation itself, not its shareholders from which shares are repurchased. The amount of the excise tax is generally 1% of the fair market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the excise tax. The U.S. Department of the Treasury (the "Treasury") has been given authority to provide regulations and other guidance to carry out and prevent the abuse or avoidance of the excise tax.
Any redemption or other repurchase that occurs after December 31, 2022, in connection with a Business Combination, extension vote or otherwise, may be subject to the excise tax. Whether and to what extent the Company would be subject to the excise tax in connection with a Business Combination, extension vote or otherwise would depend on a number of factors, including (i) the fair market value of the redemptions and repurchases in connection with the Business Combination, extension or otherwise, (ii) the structure of a Business Combination, (iii) the nature and amount of any "PIPE" or other equity issuances in connection with a Business Combination (or otherwise issued not in connection with a Business Combination but issued within the same taxable year of a Business Combination) and (iv) the content of regulations and other guidance from the Treasury. In addition, because the excise tax would be payable by the Company and not by the redeeming holder, the mechanics of any required payment of the excise tax have not been determined. The foregoing could cause a reduction in the cash available on hand to complete a Business Combination and in the Company's ability to complete a Business Combination.
Note 2—Significant Accounting Policies and Basis of Presentation
Basis of Presentation
The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in unaudited condensed financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Prospectus which contains the audited financial statements and notes thereto included in the Form 10-K annual report filed by the Company with the SEC on April 13, 2022. The interim results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future interim periods.
Emerging Growth Company Status
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
8
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 unaudited condensed 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 unaudited condensed financial statements in conformity with US 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 unaudited condensed financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. One of the more significant accounting estimates included in the unaudited condensed financial statements is the determination of the fair value of the warrant liability. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly from those estimates.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account.
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 did
Marketable Securities Held in Trust Account
At September 30, 2022 and December 31, 2021, the Company held $
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under FASB ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the condensed balance sheets, primarily due to its short-term nature.
9
Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The Company’s financial instruments are classified as either Level 1, Level 2 or Level 3. 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. |
Derivative Financial Instruments and Warrant and Over-allotment Liability
The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 815-15. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity and measurement of fair value is re-assessed at the end of each reporting period. In accordance with ASC 825-10 “Financial Instruments”, offering costs attributable to the issuance of the derivative warrant liabilities and overallotment option have been allocated based on their relative fair value of total proceeds and are recognized in the condensed statements of operations as incurred. Derivative warrant liabilities are classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or the creation of current liabilities.
The Company accounts for warrants and over-allotment as either equity-classified or liability-classified instruments based on an assessment of the warrant and over-allotment option’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants and over-allotment option are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants and over-allotment option meet all of the requirements for equity classification under ASC 815, including whether the warrants and over-allotment option are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment is conducted at the time of warrant and over-allotment option issuance and as of each subsequent quarterly period end date while the warrants and over-allotment option are outstanding.
For warrants and over-allotment option that meet all of the criteria for equity classification, they are recorded as a component of additional paid-in capital at the time of issuance. For warrants and over-allotment that do not meet all the criteria for equity classification, they are required to be recorded as a liability at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants and over-allotment option are recognized as a non-cash gain or loss on the condensed statements of operations.
The Company accounted for the Public Warrants (see Note 3), Private Placement Warrants (see Note 4) (together with the Public Warrants, the “Warrants”) and over-allotment option (Note 6) in accordance with the guidance contained in ASC 815-40. The Warrants and over-allotment are not considered indexed to the Company’s own ordinary shares, and as such, they do not meet the criteria for equity treatment and are recorded as liabilities.
Income Taxes
The Company accounts for income taxes under FASB ASC 740, “Income Taxes” (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the unaudited condensed financial statements and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.
10
FASB 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. There were
There is currently no taxation imposed on income by the Government of the Cayman Islands. In accordance with Cayman income tax regulations, income taxes are not levied on the Company. Consequently, income taxes are not reflected in the Company’s unaudited condensed financial statements.
Net Income (Loss) Per Share
We comply with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net income per share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture by the Sponsor. At September 30, 2022 and December 31, 2021, weighted average shares were reduced for the effect of an aggregate of
The table below presents a reconciliation of the numerator and denominator used to compute basic and diluted net income per share for each class of ordinary shares:
For the Three | For the Nine | |||||||||||
Months Ended | Months Ended | |||||||||||
September 30, 2022 | September 30, 2022 | |||||||||||
| Class A |
| Class B |
| Class A |
| Class B | |||||
Basic and diluted net (loss) income per share: | ||||||||||||
Numerator: | ||||||||||||
Allocation of net (loss) income |
| $ | ( | $ | ( |
| $ | | $ | | ||
Denominator: | ||||||||||||
Weighted average shares outstanding | | | | | ||||||||
Basic and diluted net (loss) income per share |
| ( | ( |
| | | ||||||
For the period from | ||||||||||||
May 20, 2021 | ||||||||||||
For the Three | (Inception) | |||||||||||
Months Ended | through | |||||||||||
September 30, 2021 | September 30, 2021 | |||||||||||
| Class A |
| Class B |
| Class A |
| Class B | |||||
Basic and diluted net loss per share: |
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Numerator: |
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Allocation of net loss | $ | — | $ | ( | $ | — | $ | ( | ||||
Denominator: |
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Weighted average shares outstanding |
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Basic and diluted net loss per share | — | ( | — | ( | ||||||||
11
Offering Costs associated with the Initial Public Offering
The Company complies with the requirements of ASC 340-10-S99-1, SEC Staff Accounting bulletin Topic 5A – “Expenses of Offering”, and SEC Staff Accounting bulletin Topic 5T – “Accounting for Expenses or Liabilities Paid by Principal Stockholder(s)”. Offering costs consist principally of professional and registration fees incurred through the balance sheet date that are related to the IPO. Offering costs directly attributable to the issuance of an equity contract to be classified in temporary equity are recorded as a reduction of equity. Offering costs for equity contracts that are classified as assets and liabilities are expensed immediately. The Company incurred offering costs amounting to $
Class A Shares Subject to Possible Redemption
The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480. Ordinary shares subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature 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) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ deficit. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A ordinary shares subject to possible redemption is presented as temporary equity, outside of the shareholders’ deficit section of the Company’s condensed balance sheets.
As of September 30, 2022, the amount of Class A ordinary shares reflected on the condensed balance sheets are reconciled in the following table:
Gross proceeds from IPO |
| $ | |
Less: |
|
| |
Fair value of proceeds allocated to Public Warrants |
| ( | |
Fair value of proceeds allocated to overallotment liability |
| ( | |
Class A ordinary shares issuance cost |
| ( | |
Plus: |
|
| |
Remeasurement of Class A ordinary shares subject to possible redemption at initial public offering |
| | |
Class A ordinary shares subject to possible redemption as of March 31, 2022 | | ||
Plus: | |||
Remeasurement of Class A ordinary shares subject to possible redemption | | ||
Class A ordinary shares subject to possible redemption as of September 30, 2022 | $ | |
Redeemable Share Classification
The Company’s ordinary shares that will be sold as part of the Units in the IPO (“public ordinary shares”) contain a redemption feature which allows for the redemption of such public shares in connection with a shareholder vote or tender offer in connection with the Company’s initial Business Combination. In accordance with ASC 480-10-S99, the Company classifies public ordinary shares subject to redemption outside of permanent equity as the redemption provisions are not solely within the control of the Company. The public ordinary shares sold as part of the Units in the IPO will be issued with other freestanding instruments (i.e., Public Warrants) and as such, the initial carrying value of public ordinary shares classified as temporary equity, and the Public Warrants will be considered a derivative liability and as such, the fair value of the Public Warrants is bifurcated and presented as a liability. The public ordinary shares are subject to ASC 480-10-S99 and are currently not redeemable as the redemption is contingent upon the occurrence of events mentioned above.
Recent Accounting Pronouncements
The Company’s management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying financial statements.
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Note 3—Initial Public Offering
On January 27, 2022, the Company consummated its IPO of
Note 4—Private Placement Warrants
Simultaneously with the closing of the IPO, the Sponsor purchased an aggregate of
The Private Placement Warrants are identical to the warrants sold in the IPO except that the Private Placement Warrants, so long as they are held by the Sponsor or its permitted transferees, (i) will not be redeemable by the Company, (ii) may not (including the Class A ordinary shares issuable upon exercise of these Private Placement Warrants), subject to certain limited exceptions, be transferred, assigned or sold by the holders until
If the Private Placement Warrants are held by holders other than the Sponsor or its permitted transferees, the Private Placement Warrants will be redeemable by the Company in all redemption scenarios and exercisable by the holders on the same basis as the warrants included in the units being sold in the IPO.
Note 5—Related Party Transactions
Founder Shares
On June 2, 2021, the Sponsor paid $
The holders of the Company’s founder shares prior to the IPO (the “initial shareholders”) have agreed not to transfer, assign or sell any of their founder shares and any Class A ordinary shares issuable upon conversion thereof until the earlier to occur of: (i)
The sale or allocation of the Founders Shares to the Company’s director nominees and affiliates of its Sponsor group, as described above, is within the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The fair value of the
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Promissory Note—Related Party
On June 2, 2021, the Sponsor agreed to loan the Company up to $
Working Capital Loans
In order to finance transaction costs in connection with an intended initial Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes its initial Business Combination, the Company would repay the Working Capital Loans. In the event that the initial Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay the Working Capital Loans but no proceeds from the Trust Account would be used to repay the Working Capital Loans. Up to $
Note 6—Commitments & Contingencies
Registration and Shareholder Rights
The holders of the (i) founder shares, which were issued in a private placement prior to the closing of the IPO, (ii) Private Placement Warrants, which were issued in a private placement simultaneously with the closing of the IPO and the Class A ordinary shares underlying such Private Placement Warrants and (iii) Private Placement Warrants that may be issued upon conversion of working capital loans have registration rights to require the Company to use its best efforts to register a sale of any of its securities held by them pursuant to a registration rights agreement. The holders of these securities are entitled to make up to
Underwriting Agreement
The Company granted the underwriters a option from the date of the IPO to purchase up to an additional
The underwriters received a cash underwriting discount of two percent (
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Forward Purchase Agreement
An affiliate of the Sponsor (the “Sponsor Affiliate”) entered into a forward purchase agreement with the Company in connection with the IPO that provides for the purchase by the Sponsor Affiliate of an aggregate of up to
The forward purchase shares are identical to the Class A ordinary shares included in the units sold in the IPO, except that pursuant to the forward purchase agreement, they are not transferable, assignable or salable until 30 days after the completion of our initial business combination, subject to limited exceptions. The forward purchase warrants have the same terms as the private placement warrants.
Note 7—Shareholder’s Deficit
Preference shares—The Company is authorized to issue
Class A ordinary shares—The Company is authorized to issue
Class B ordinary shares—The Company is authorized to issue
Holders of Class A ordinary shares and holders of Class B ordinary shares will vote together as a single class on all matters submitted to a vote of the shareholders except as required by law. Unless specified in the Company’s amended and restated memorandum and articles of association, or as required by applicable provisions of the Companies Act or applicable stock exchange rules, the affirmative vote of a majority of the Company’s ordinary shares that are voted is required to approve any such matter voted on by its shareholders.
The Class B ordinary shares will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of the initial Business Combination on a one-for-one basis, subject to adjustment for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional Class A ordinary shares or equity-linked securities are issued or deemed issued in connection with the initial Business Combination, the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate,
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Note 8—Fair Value Measurements
The following table presents information about the Company’s liabilities that are measured at fair value on September 30, 2022, and indicates the Level 3 fair value hierarchy of the valuation inputs the Company utilized to determine such fair value. At December 31, 2021, the Company had no financial assets and liabilities measured at fair value.
|
| Quoted |
| Significant |
| Significant | ||||||
Prices in | Other | Other | ||||||||||
Active | Observable | Unobservable | ||||||||||
September 30, | Markets | Inputs | Inputs | |||||||||
2022 | (Level 1) | (Level 2) | (Level 3) | |||||||||
Liabilities: |
|
|
|
|
|
|
|
| ||||
Warrant liabilities – Public Warrants | $ | | $ | | $ | — | $ | — | ||||
Warrant liabilities – Private Placement Warrants |
| |
| — |
| |
| — | ||||
$ | | $ | | $ | | $ | — | |||||
The Public Warrants and the Private Placement Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within liabilities on the condensed balance sheets. The warrant liabilities were measured at fair value at inception and remeasured on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed statements of operations.
The overallotment option was accounted for as a liability in accordance with ASC 815-40 and was presented within liabilities on the condensed balance sheets from January 27, 2022 up to its expiration on March 10, 2022. The overallotment liability was measured at fair value at inception. The expiration of the overallotment resulted in a gain of $
The Company used a Binomial Option Pricing Model to value the Private Placement Warrants and a Black-Scholes model to value the overallotment option. The Company allocated the proceeds received from (i) the sale of Units (which is inclusive of
At September 30, 2022, the Company used the quoted price on Nasdaq to establish the fair value of the Public Warrants and transferred the Public Warrants from Level 3 to Level 1 due to the use of observable inputs.
The key inputs into the Black-Scholes model of the overallotment option were as follows at inception date:
| January 27, | |||
Input | 2022 | |||
Risk-free interest rate |
| | % | |
Expected term (years) |
| | ||
Expected volatility |
| | % | |
Exercise price | $ | | ||
Fair value of overallotment unit | $ | | ||
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The Private Warrants were transferred to a Level 2 from a Level 3 during the nine months ended September 30, 2022, due to the use of an observable market quote for a similar asset in an active market. At September 30, 2022 the Company’s Public Warrant pricing was used to price the Private Warrants.
Input | January 27, 2022 | |||
Risk-free interest rate |
| | % | |
Expected term (years) |
| | ||
Expected volatility |
| | % | |
Exercise price | $ | | ||
Stock price | $ | | ||
The following table provides a summary of the changes in the fair value of the Company’s Level 3 financial instruments that are measured at fair value on a recurring basis:
| Private |
|
|
| ||||||||
Placement | Public | Total Warrant | Overallotment | |||||||||
Warrants | Warrants | Liabilities | Liability | |||||||||
Fair value at December 31, 2021 | $ | $ | $ | $ | ||||||||
Initial measurement at January 27, 2022 |
| |
| |
| |
| | ||||
Expiration of overallotment option on March 10, 2022 |
| — |
| — |
| — |
| ( | ||||
Change in fair value of warrant liabilities |
| ( |
| ( |
| ( |
| — | ||||
Transfer to Level 1 |
| — |
| ( |
| ( |
| — | ||||
Fair value at March 31, 2022 | | — | | — | ||||||||
Change in fair value of warrant liabilities | ( | — | ( | — | ||||||||
Transfer to Level 2 | ( | — | ( | — | ||||||||
Fair value at June 30, 2022 | $ | — | $ | — | $ | — | $ | — | ||||
Change in fair value of warrant liabilities | — | — | — | — | ||||||||
Transfer to Level 3 | — | — | — | — | ||||||||
Fair value at September 30, 2022 | $ | — | $ | — | $ | — | $ | — | ||||
As of December 31, 2021, the Company had
Note 9—Subsequent Events
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the unaudited condensed financial statements were issued. Based on this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the unaudited condensed financial statements.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
References in this quarterly report to “we,” “us,” “Company” or “our company” are to LatAmGrowth SPAC, a Cayman Islands exempted company. References to “management” or our “management team” are to our officers and directors. References to our “Sponsor” is to LatAmGrowth Sponsor LLC, a Delaware limited liability company. References to our “initial shareholders” are to the holders of our Class B ordinary shares prior to our IPO.
Cautionary Note Regarding Forward-Looking Statements
All statements other than statements of historical fact included in this quarterly report, including, without limitation, statements under “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 quarterly 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, our 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 unaudited condensed financial statements and the notes thereto contained elsewhere in this quarterly 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 on May 20, 2021 as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. We have not selected any specific business combination target. While we may pursue an initial business combination target in any industry, we intend to focus our search on Latin American businesses or Hispanic-owned businesses in the United States. We intend to effectuate our initial business combination using cash from the proceeds of our IPO and the private placement of the private placement warrants and forward purchase units, the proceeds of the sale of our shares in connection with our initial business combination (pursuant to forward purchase agreements or backstop agreements we may enter into), 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.
The issuance of additional shares in connection with a business combination to the owners of the target or other investors:
| ● | may significantly dilute the equity interest of investors in our IPO, which dilution would increase if the anti-dilution provisions in the Class B ordinary shares resulted in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the Class B ordinary shares; |
| ● | may subordinate the rights of holders of Class A ordinary shares if preference shares are issued with rights senior to those afforded our Class A ordinary shares; |
| ● | could cause a change in control if a substantial number of our Class A ordinary shares are issued, which could result in the resignation or removal of our present officers and directors; |
| ● | may have the effect of delaying or preventing a change of control of us by diluting the share ownership or voting rights of a person seeking to obtain control of us; and |
| ● | may adversely affect prevailing market prices for our Class A ordinary shares and/or warrants. |
Similarly, if we issue debt securities or otherwise incur significant debt to bank or other lenders or the owners of a target, it could result in:
| ● | default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations; |
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| ● | acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
| ● | our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand; |
| ● | our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding; |
| ● | our inability to pay dividends on our Class A ordinary shares; |
| ● | using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our Class A ordinary shares, expenses, capital expenditures, acquisitions and other general corporate purposes; |
| ● | limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
| ● | increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and |
| ● | limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. |
As indicated in the accompanying unaudited condensed financial statements, at September 30, 2022, we had $1,150,366 in cash and working capital of $1,188,383. Transaction costs related to our IPO amounted to $7,647,620 consisting of $2,600,000 of underwriting discount, $4,550,000 of deferred underwriting discount, and $497,620 of other offering costs. Further, we expect to incur significant costs in the pursuit of our initial business combination. We cannot assure you that our plans to raise capital or to complete our initial business combination will be successful.
Results of Operations and Known Trends or Future Events
As of September 30, 2022, we have not commenced any operations. All activity for the period from May 20, 2021 (inception) through September 30, 2022, relates to our formation and IPO, and, since the completion of our IPO, searching for a target to consummate an initial business combination. We will not generate any operating revenues until after the completion of our initial business combination, at the earliest. We generate non-operating income in the form of interest income from the proceeds derived from our IPO and placed in the trust account.
For the three months ended September 30, 2022, we had a net loss of $835,600, which consisted of unrealized loss on change in fair value of warrants of $1,152,000 and formation and operating costs of $286,101, partially offset by trust interest income of $602,501.
For the nine months ended September 30, 2022, we had a net income of $7,960,653, which consisted of unrealized gain on change in fair value of warrants of $8,064,000, gain on expiration of overallotment option of $390,000, and trust interest income of $790,345, partially offset by formation and operating costs of $948,461 and warrant issuance costs of $335,231.
For the period from May 20, 2021 (inception) through September 30, 2021, we had a net loss of $91,442, which consisted primarily of formation and operating costs.
Liquidity and Capital Resources; Going Concern
As of September 30, 2022, we had $1,150,366 cash on hand and working capital of $1,188,383.
On January 27, 2022, we consummated our IPO of 13,000,000 units, at $10.00 per unit, generating gross proceeds of $130.0 million. Simultaneously with the closing of our IPO, we consummated the sale of 7,900,000 private placement warrants at a price of $1.00 per private placement warrant in a private placement to our Sponsor, generating gross proceeds of $7.9 million. Prior to the completion of the IPO, we lacked the liquidity we needed to sustain operations for a reasonable period of time, which is considered to be one year from
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the issuance date of the unaudited condensed financial statements. At the IPO date, cash of $2,494,203 in excess of the funds deposited in the Trust Account and/or used to fund offering expenses was released to us for general working capital purposes.
We believe that the $1.15 million in cash held outside the trust account will be sufficient to allow us to operate until either the consummation of a business combination or the mandatory liquidation date; however, if our estimate of the costs of undertaking in-depth due diligence and negotiating the business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to the business combination. As such, we cannot provide assurance that the cash held outside the trust account will be sufficient to meet our financial obligations over a period of one year from the issuance of these unaudited condensed financial statements. Until consummation of our initial Business Combination, we will be using these funds for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
We can raise additional capital through Working Capital Loans from the Sponsor, an affiliate of the Sponsor, certain of our officers and directors, or through loans from third parties. If we are unable to raise additional capital, we may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of our business plan, and reducing overhead expenses. We cannot provide assurance that new financing will be available to us on commercially acceptable terms, if at all.
We have until April 27, 2023 (with optional three-month extension periods up to October 27, 2023 which are conditional upon securing additional funding from our Sponsor) to consummate a business combination. It is uncertain that we will be able to consummate a business combination by April 27, 2023 or obtain additional funding to extend the deadline for consummating a business combination. We cannot provide assurance that the required funding will be made available to us to allow us to extend the business combination period beyond April 27, 2023. If a business combination is not consummated by the required date and we are unable to obtain the funding to extend the business combination period beyond the initial deadline, there will be a mandatory liquidation and subsequent dissolution. In connection with our assessment of going concern considerations in accordance with the authoritative guidance in FASB ASU 2014-15, we have determined that mandatory liquidation, and subsequent dissolution, should we be unable to complete a business combination, raises substantial doubt about our ability to continue as a going concern for the next twelve months from the issuance of these unaudited condensed financial statements.
Off-Balance Sheet Financing Arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of September 30, 2022 and December 31, 2021. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Contractual Obligations
As of September 30, 2022 and December 31, 2021, we did not have any long-term debt, capital or operating lease obligations.
Critical Accounting Policies
The preparation of unaudited condensed financial statements and related disclosures in conformity with accounting principles generally accepted in the United States 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 unaudited condensed financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following as our critical accounting policies:
Offering Costs
Deferred offering costs consist of legal and accounting expenses incurred through the balance sheet date that are directly related to our IPO. Deferred offering costs, other than the underwriting discount, were allocated to the Units issued in our IPO and the Private Placement Warrants based on a relative fair value basis, compared to total proceeds received. The underwriting discount was allocated to the Units based on a relative fair value basis, compared to total proceeds received. Upon completion of our IPO, offering costs
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associated with warrant liabilities were expensed, and presented as non-operating expenses in the condensed statements of operations and offering costs associated with the Class A ordinary shares were applied against Class A ordinary shares subject to possible redemption which are classified as temporary equity.
Fair Value of Financial Instruments
The fair value of our assets and liabilities, which qualify as financial instruments under FASB ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the condensed balance sheets, primarily due to its short-term nature.
Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Our financial instruments are classified as either Level 1, Level 2 or Level 3. 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. |
Derivative Financial Instruments and Warrant and Over-allotment Liability
We do not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. We evaluate all of our financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 815-15. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity and measurement of fair value is re-assessed at the end of each reporting period. In accordance with ASC 825-10 “Financial Instruments”, offering costs attributable to the issuance of the derivative warrant liabilities and overallotment option have been allocated based on their relative fair value of total proceeds and are recognized in the condensed statements of operations as incurred. Derivative warrant liabilities are classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or the creation of current liabilities.
We account for warrants and over-allotment as either equity-classified or liability-classified instruments based on an assessment of the warrant and over-allotment option’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants and over-allotment option are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants and over-allotment option meet all of the requirements for equity classification under ASC 815, including whether the warrants and over-allotment option are indexed to our own ordinary shares, among other conditions for equity classification. This assessment is conducted at the time of warrant and over-allotment option issuance and as of each subsequent quarterly period end date while the warrants and over-allotment option are outstanding.
For issued or modified warrants and over-allotment option that meet all of the criteria for equity classification, the warrants and over-allotment option are recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants and over-allotment option that do not meet all the criteria for equity classification, the warrants and over-allotment option are required to be recorded as a liability at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants and over-allotment option are recognized as a non-cash gain or loss on the condensed statements of operations.
We accounted for the warrants and over-allotment option in accordance with the guidance contained in ASC 815-40. The warrants and over-allotment are not considered indexed to our own ordinary shares, and as such, they do not meet the criteria for equity treatment and are recorded as liabilities.
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Redeemable Share Classification
Our ordinary shares that were sold as part of the Units in our IPO (“public ordinary shares”) contain a redemption feature which allows for the redemption of such public shares in connection with a shareholder vote or tender offer in connection with our initial Business Combination. In accordance with ASC 480-10-S99, we classify public ordinary shares subject to redemption outside of permanent equity as the redemption provisions are not solely within our control. The public ordinary shares sold as part of the Units in our IPO were issued with other freestanding instruments (i.e., Public Warrants) and as such, the initial carrying value of public ordinary shares classified as temporary equity, and the Public Warrants are considered a derivative liability and as such, the fair value of the Public Warrants is bifurcated and presented as a liability. The public ordinary shares are subject to ASC 480-10-S99 and are currently not redeemable as the redemption is contingent upon the occurrence of events mentioned above.
Net Income (Loss) Per Share
We comply with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net income (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 by the Sponsor. At September 30, 2022 and December 31, 2021, weighted average shares were reduced for the effect of an aggregate of 487,500 Class B ordinary shares that were subject to forfeiture if the over-allotment option was not exercised by the underwriters. At September 30, 2022 and December 31, 2021, we did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in our earnings. As a result, diluted income (loss) per share is the same as basic income (loss) per share for the period presented.
Recent Accounting Pronouncements
Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on our financial statements.
JOBS Act
The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an “emerging growth company” and under the JOBS Act are allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our unaudited condensed financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an independent registered public accounting firm’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the report of the independent registered public accounting firm providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our IPO or until we are no longer an “emerging growth company,” whichever is earlier.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Following the consummation of our IPO, the net proceeds of our IPO, including amounts in the trust account, have been invested in U.S. government treasury bills, notes or bonds with a maturity of 185 days or less or in certain money market funds that invest solely in US treasuries. Due to the short-term nature of these investments, we believe there will be no associated material exposure to interest rate risk.
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Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Disclosure controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed under the Exchange Act, such as this Report, is recorded, processed, summarized, and reported within the time period specified in the SEC’s rules and forms. Disclosure controls are also designed with the objective of ensuring that such information is accumulated and communicated to our management, including the chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure. Our management evaluated, with the participation of our chief executive officer and chief financial officer (our “Certifying Officers”), the effectiveness of our disclosure controls and procedures as of September 30, 2022, pursuant to Rule 13a-15(b) under the Exchange Act. Based upon that evaluation, our Certifying Officers concluded that, as of September 30, 2022, our disclosure controls and procedures were not effective.
Specifically, management’s determination was based on the following material weakness which existed at December 31, 2021. Our internal control over the recording of accounting transactions in the proper period is not effective. We did not record deferred offering costs in the proper accounting period. The costs were paid in 2022 but incurred in 2021 so they were not properly accrued at December 31, 2021. In the second quarter of 2022, we identified certain costs that were incorrectly or not recorded in the first quarter of 2022 and for which adjustments were made in the second quarter of 2022. A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. We are currently reviewing our internal controls over financial reporting, and specifically our internal control over the recording of accounting transactions in the proper period, and intend to take appropriate measures to remediate the material weakness; however, we have not yet implemented such remediation measures. As such, the material weakness continues to exist at September 30, 2022. Notwithstanding the determination that our internal control over financial reporting was not effective and that there was a material weakness as identified in this Quarterly Report, as of September 30, 2022, we believe that our unaudited condensed financial statements contained in this Quarterly Report fairly present our financial position, results of operations and cash flows for the years covered hereby in all material respects.
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 Control Over Financial Reporting
This Quarterly Report on Form 10-Q does not include a management’s assessment regarding internal control over financial reporting or an attestation report of our registered public accounting firm due to a transition period established by rules of the SEC for newly public companies and for an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012.
Changes in Internal Control Over Financial Reporting
During the most recently completed fiscal quarter, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
23
PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
There is no material litigation, arbitration or governmental proceeding currently pending against us or any members of our management team in their capacity as such.
Item 1A. Risk Factors.
Factors that could cause our actual results to differ materially from those in this Quarterly Report are any of the risks described in the Prospectus and in our Annual Report for the year ended December 31, 2021. As of the date of this Quarterly Report, there have been no material changes to the risk factors described in the Prospectus or the Annual Report for the year ended December 31, 2021 except for the below. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.
Recent increases in inflation in the United States and elsewhere could make it more difficult for us to complete our initial business combination.
Recent increases in inflation in the United States and elsewhere may lead to increased price volatility for publicly traded securities, including ours, or other national, regional or international economic disruptions, any of which could make it more difficult for us to complete our initial business combination.
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.
We are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Laws and regulations and their interpretation and application may also change from time to time and such changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to negotiate and complete our initial business combination, and results of operations.
On March 30, 2022, the SEC issued proposed rules that would, among other things, impose additional disclosure requirements for initial public offerings by special purpose acquisition companies (“SPACs”) and business combination transactions involving SPACs and private operating companies; amend the financial statement requirements applicable to business combination transactions involving such companies; update and expand guidance regarding the general use of projections in SEC filings, as well as when projections are disclosed in connection with proposed business combination transactions; increase the potential liability of certain participants in proposed business combination transactions; and impact the extent to which SPACs could become subject to regulation under the Investment Company Act of 1940. These rules, if adopted, whether in the form proposed or in revised form, may materially adversely affect our business, including our ability to negotiate and complete our initial business combination and may increase the costs and time related thereto.
After our initial business combination, substantially all of our assets may be located in a foreign country and substantially all of our revenue will be derived from our operations in such country. Accordingly, our results of operations and prospects will be subject, to a significant extent, to the economic, political and legal policies, developments and conditions in the country in which we operate.
The economic, political and social conditions, as well as government policies, of the country in which our operations are located could affect our business. Economic growth could be uneven, both geographically and among various sectors of the economy and such growth may not be sustained in the future. If in the future such country’s economy experiences a downturn or grows at a slower rate than expected, there may be less demand for spending in certain industries. A decrease in demand for spending in certain industries could materially and adversely affect our ability to find an attractive target business with which to consummate our initial business combination and if we effect our initial business combination, the ability of that target business to become profitable.
We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine. Our business, financial condition and results
24
of operations may be materially and adversely affected by any negative impact on the global economy and capital markets resulting from the conflict in Ukraine or any other geopolitical tensions.
Russian military actions and the resulting sanctions could adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets, potentially making it more difficult for us to obtain additional funds.
Any of the above-mentioned factors could affect our business, prospects, financial condition, and operating results. The extent and duration of the military action, sanctions and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in the Prospectus or the Annual Report for the year ended December 31, 2021.
25
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On January 27, 2022, we consummated our IPO of 13,000,000 units. The units sold in our IPO were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $130.0 million. BofA Securities, Inc. and Banco BTG Pactual S.A. — Cayman Branch acted as underwriters of the offering. The securities in the offering were registered under the Securities Act on a registration statement on Form S-1 (No. 333-261361). The registration statement was declared effective on January 24, 2022.
Substantially concurrently with the closing of our IPO, the Company completed the private sale of 7,900,000 warrants (the “Private Placement Warrants”) at a purchase price of $1.00 per Private Placement Warrant, to the Company’s Sponsor, LatAmGrowth Sponsor LLC (the “Sponsor”), generating gross proceeds to the Company of $7.9 million. The private placement warrants are identical to the warrants sold as part of the units in our IPO except that, so long as they are held by the Sponsor or its permitted transferees: (1) they will not be redeemable by the Company (except in certain redemption scenarios when the price per Ordinary Share equals or exceeds $10.00 (as adjusted)); (2) they (including the Ordinary Shares issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by the Sponsor until 30 days after the completion of the Company’s initial business combination; (3) they may be exercised by the holders on a cashless basis; and (4) they (including the Ordinary Shares issuable upon exercise of these warrants) are entitled to registration rights.
We paid a total of $2.6 million in underwriting discounts and commissions and approximately $0.5 million for other costs and expenses related to our IPO. In addition, the underwriters agreed to defer up to $4.55 million in underwriting discounts and commissions.
A total of $132.6 million of the net proceeds from the sale of the units in our IPO and the private placement on January 27, 2022 were placed in a trust account established for the benefit of the Company’s public shareholders at JP Morgan Chase Bank, N.A., maintained by Continental Stock Transfer & Trust Company, acting as trustee.
There has been no material change in the planned use of proceeds from our IPO as described in our final prospectus dated January 24, 2022, which was filed with the SEC.
Item 3. Defaults upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
None.
26
Item 6. Exhibits.
Exhibit Number |
| Description |
31.1* |
| |
31.2* |
| |
32.1** |
| |
32.2** |
| |
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema Document | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
101.DEF | XBRL Taxonomy Extension Definitions Linkbase Document | |
101.LAB | KBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* | Filed herewith |
** | Furnished herewith |
27
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this quarterly report to be signed on its behalf by the undersigned, thereunto duly authorized.
| LATAMGROWTH SPAC | |
|
| |
Date: November 14, 2022 | By: | /s/ Gerard Cremoux |
|
| Name: Gerard Cremoux |
|
| Title: Chief Executive Officer, Chief Financial Officer and Director |
28
Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO RULE 13a-14(a) OR 15d-14(a)
UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Gerard Cremoux, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 of LatAmGrowth SPAC; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: November 14, 2022 | By: | /s/ Gerard Cremoux |
| | Gerard Cremoux |
| | Chief Executive Officer |
| | (Principal Executive Officer) |
Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO RULE 13a-14(a) OR 15d-14(a)
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Gerard Cremoux, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 of LatAmGrowth SPAC; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: November 14, 2022 | By: | /s/ Gerard Cremoux |
| | Gerard Cremoux |
| | Chief Financial Officer |
| | (Principal Financial and Accounting Officer) |
Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of LatAmGrowth SPAC (the “Company”) on Form 10-Q for the quarter ended September 30, 2022, as filed with the Securities and Exchange Commission (the “Report”), I, Gerard Cremoux, 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:
| (1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| (2) | To my knowledge, the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report. |
Date: November 14, 2022 | /s/ Gerard Cremoux |
| Gerard Cremoux |
| Chief Executive Officer |
| (Principal Executive Officer) |
* | The foregoing certification is being furnished solely pursuant to 18 U.S.C. §1350 and is not being filed as part of the Report or as a separate disclosure document. |
Exhibit 32.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of LatAmGrowth SPAC (the “Company”) on Form 10-Q for the quarter ended September 30, 2022, as filed with the Securities and Exchange Commission (the “Report”), I, Gerard Cremoux, 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:
| (1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| (2) | To my knowledge, the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report. |
Date: November 14, 2022 | /s/ Gerard Cremoux |
| Gerard Cremoux |
| Chief Financial Officer |
| (Principal Financial Officer) |
* | The foregoing certification is being furnished solely pursuant to 18 U.S.C. §1350 and is not being filed as part of the Report or as a separate disclosure document. |
CONDENSED STATEMENTS OF OPERATIONS - USD ($) |
3 Months Ended | 4 Months Ended | 9 Months Ended | |
|---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2021 |
Sep. 30, 2022 |
|
| Formation and operating costs | $ 286,101 | $ 1,442 | $ 91,442 | $ 948,461 |
| Loss from operations | (286,101) | (1,442) | (91,442) | (948,461) |
| Other (expense) income: | ||||
| Gain (loss) on change in fair value of warrants | (1,152,000) | 8,064,000 | ||
| Gain on expiration of overallotment option | 390,000 | |||
| Trust interest income | 602,501 | 790,345 | ||
| Warrant issuance costs | (335,231) | |||
| Total other (expense) income, net | (549,499) | 8,909,114 | ||
| Net (loss) income | $ (835,600) | $ (1,442) | $ (91,442) | $ 7,960,653 |
| Class A ordinary shares | ||||
| Other (expense) income: | ||||
| Basic weighted-average shares outstanding | 13,000,000 | 11,718,978 | ||
| Diluted weighted-average shares outstanding | 13,000,000 | 0 | 0 | 11,718,978 |
| Basic net (loss) income per share | $ (0.05) | $ 0.53 | ||
| Diluted net (loss) income per share | $ (0.05) | $ 0.00 | $ 0.00 | $ 0.53 |
| Class A Common Stock Subject to Redemption | ||||
| Other (expense) income: | ||||
| Basic weighted-average shares outstanding | 13,000,000 | 11,718,978 | ||
| Diluted weighted-average shares outstanding | 13,000,000 | 0 | 0 | 11,718,978 |
| Basic net (loss) income per share | $ (0.05) | $ 0.53 | ||
| Diluted net (loss) income per share | $ (0.05) | $ 0.00 | $ 0.00 | $ 0.53 |
| Class B ordinary shares | ||||
| Other (expense) income: | ||||
| Basic weighted-average shares outstanding | 3,250,000 | 3,250,000 | 3,250,000 | 3,250,000 |
| Diluted weighted-average shares outstanding | 3,250,000 | 3,250,000 | 3,250,000 | 3,250,000 |
| Basic net (loss) income per share | $ (0.05) | $ 0.00 | $ (0.03) | $ 0.53 |
| Diluted net (loss) income per share | $ (0.05) | $ 0.00 | $ (0.03) | $ 0.53 |
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS' DEFICIT - USD ($) |
Class B ordinary shares
Common Stock
|
Additional Paid-in Capital |
Accumulated Deficit |
Total |
|---|---|---|---|---|
| Balance at the beginning at May. 19, 2021 | $ 0 | $ 0 | $ 0 | $ 0 |
| Balance at the beginning (in shares) at May. 19, 2021 | 0 | |||
| Increase (Decrease) in Stockholders' Equity | ||||
| Class B ordinary shares issued to Sponsor for payment of offering costs | $ 374 | 24,626 | 25,000 | |
| Class B ordinary shares issued to Sponsor for payment of offering costs (in shares) | 3,737,500 | |||
| Net income (loss) | (90,000) | (90,000) | ||
| Balance at the end at Jun. 30, 2021 | $ 374 | 24,626 | (90,000) | (65,000) |
| Balance at the end (in shares) at Jun. 30, 2021 | 3,737,500 | |||
| Balance at the beginning at May. 19, 2021 | $ 0 | 0 | 0 | 0 |
| Balance at the beginning (in shares) at May. 19, 2021 | 0 | |||
| Increase (Decrease) in Stockholders' Equity | ||||
| Net income (loss) | (91,442) | |||
| Balance at the end at Sep. 30, 2021 | $ 374 | 24,626 | (91,442) | (66,442) |
| Balance at the end (in shares) at Sep. 30, 2021 | 3,737,500 | |||
| Balance at the beginning at Jun. 30, 2021 | $ 374 | 24,626 | (90,000) | (65,000) |
| Balance at the beginning (in shares) at Jun. 30, 2021 | 3,737,500 | |||
| Increase (Decrease) in Stockholders' Equity | ||||
| Net income (loss) | (1,442) | (1,442) | ||
| Balance at the end at Sep. 30, 2021 | $ 374 | 24,626 | (91,442) | (66,442) |
| Balance at the end (in shares) at Sep. 30, 2021 | 3,737,500 | |||
| Balance at the beginning at Dec. 31, 2021 | $ 374 | 24,626 | (90,535) | (65,535) |
| Balance at the beginning (in shares) at Dec. 31, 2021 | 3,737,500 | |||
| Increase (Decrease) in Stockholders' Equity | ||||
| Excess cash received over fair value of private placement warrants | 1,896,000 | 1,896,000 | ||
| Forfeiture of 487,500 Class B ordinary shares upon expiration of overallotment option | $ (49) | 49 | ||
| Forfeiture of 487,500 Class B ordinary shares upon expiration of overallotment option (in shares) | (487,500) | |||
| Remeasurement of Class A ordinary shares to redemption amount | (1,920,675) | (13,321,715) | (15,242,390) | |
| Net income (loss) | 7,186,897 | 7,186,897 | ||
| Balance at the end at Mar. 31, 2022 | $ 325 | (6,225,353) | (6,225,028) | |
| Balance at the end (in shares) at Mar. 31, 2022 | 3,250,000 | |||
| Balance at the beginning at Dec. 31, 2021 | $ 374 | $ 24,626 | (90,535) | (65,535) |
| Balance at the beginning (in shares) at Dec. 31, 2021 | 3,737,500 | |||
| Increase (Decrease) in Stockholders' Equity | ||||
| Net income (loss) | 7,960,653 | |||
| Balance at the end at Sep. 30, 2022 | $ 325 | (6,241,942) | (6,241,617) | |
| Balance at the end (in shares) at Sep. 30, 2022 | 3,250,000 | |||
| Balance at the beginning at Mar. 31, 2022 | $ 325 | (6,225,353) | (6,225,028) | |
| Balance at the beginning (in shares) at Mar. 31, 2022 | 3,250,000 | |||
| Increase (Decrease) in Stockholders' Equity | ||||
| Remeasurement of Class A ordinary shares to redemption amount | (187,844) | (187,844) | ||
| Net income (loss) | 1,609,356 | 1,609,356 | ||
| Balance at the end at Jun. 30, 2022 | $ 325 | (4,803,841) | (4,803,516) | |
| Balance at the end (in shares) at Jun. 30, 2022 | 3,250,000 | |||
| Increase (Decrease) in Stockholders' Equity | ||||
| Remeasurement of Class A ordinary shares to redemption amount | (602,501) | (602,501) | ||
| Net income (loss) | (835,600) | (835,600) | ||
| Balance at the end at Sep. 30, 2022 | $ 325 | $ (6,241,942) | $ (6,241,617) | |
| Balance at the end (in shares) at Sep. 30, 2022 | 3,250,000 |
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS' DEFICIT (Parenthetical) |
3 Months Ended |
|---|---|
|
Mar. 31, 2022
shares
| |
| Class B ordinary shares | Over-allotment option | |
| Forfeiture of 487,500 Class B ordinary shares upon expiration of overallotment option (in shares) | 487,500 |
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) |
4 Months Ended | 9 Months Ended |
|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2022 |
|
| Cash flows from operating activities: | ||
| Net income (loss) | $ (91,442) | $ 7,960,653 |
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
| Interest earned on marketable securities held in Trust Account | (790,345) | |
| Warrant issuance costs | 335,231 | |
| Unrealized gain on change in fair value of warrants | (8,064,000) | |
| Gain on expiration of overallotment option | (390,000) | |
| Changes in operating assets and liabilities: | ||
| Prepaid expenses | (314,284) | |
| Accounts payable and accrued expenses | 91,442 | 162,306 |
| Net cash used in operating activities | (1,100,439) | |
| Cash flows from investing Activities: | ||
| Principal deposited in Trust Account | (132,600,000) | |
| Net cash used in investing activities | (132,600,000) | |
| Cash flows from financing Activities: | ||
| Proceeds from initial public offering, net of underwriters' discount | 127,400,000 | |
| Proceeds from private placement | 7,900,000 | |
| Payment of Sponsor promissory note | (142,350) | |
| Payment of deferred offering costs | (306,845) | |
| Net cash provided by financing activities | 134,850,805 | |
| Net change in cash | 1,150,366 | |
| Cash, beginning of the period | 0 | 0 |
| Cash, end of the period | 0 | 1,150,366 |
| Supplemental disclosure of cash flow information: | ||
| Deferred offering costs included in accounts payable and accrued offering costs and expenses | 221,255 | 250 |
| Deferred offering costs paid by Sponsor in exchange for issuance of Class B ordinary shares | $ 25,000 | |
| Remeasurement of Class A ordinary shares to redemption amount | 15,430,234 | |
| Deferred underwriting commissions payable charged to additional paid in capital | 4,550,000 | |
| Deferred offering costs charged to additional paid in capital | 497,620 | |
| Forfeiture of 487,500 founder shares on expiration of overallotment option | 49 | |
| Initial fair value of warrant liability | 10,944,000 | |
| Deferred offering costs charged to accumulated deficit | $ 82,175 |
CONDENSED STATEMENTS OF CASH FLOWS (Parenthetical) |
Sep. 30, 2022
shares
|
|---|---|
| CONDENSED STATEMENTS OF CASH FLOWS | |
| Forfeiture of founder shares on expiration of overallotment option | 487,500 |
Organization and Business Operation |
9 Months Ended |
|---|---|
Sep. 30, 2022 | |
| Organization and Business Operation | |
| Organization and Business Operation | Note 1—Organization and Business Operation LatAmGrowth SPAC (the “Company”) was incorporated as a Cayman Islands exempted company on May 20, 2021. The Company was incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (the “Business Combination”). The Company has not selected any Business Combination target. The Company will not be limited to a particular industry or geographic region in its identification and acquisition of a target company, but the Company intends to focus its search on high growth companies in Latin America, including Brazil, as well as businesses located in the United States that cater to the Hispanic community: (1) with significant technological advantages, and/or (2) that are well positioned to benefit from the favorable structural and secular trends of the emerging middle class. As of September 30, 2022, the Company had not commenced any operations. All activity for the period from May 20, 2021 (inception) through September 30, 2022 relates to the Company’s formation and IPO 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 on cash and cash equivalents from the proceeds derived from the IPO (as defined below). The Company has selected December 31 as its fiscal year end. The Company’s Sponsor is LatAmGrowth Sponsor LLC, a Delaware limited liability company (the “Sponsor”). The registration statement for the Company’s initial public offering was declared effective on January 24, 2022 (the “Effective Date”). On January 27, 2022, the Company consummated the Public Offering of 13,000,000 units, (the “Units” and, with respect to the ordinary shares included in the Units being offered, the “Public Shares”), at $10.00 per Unit, generating gross proceeds of $130,000,000, which is discussed in Note 3. Simultaneously with the closing of the IPO, the Company consummated the sale of 7,900,000 warrants (the “Private Placement Warrants”), at a price of $1.00 per Private Placement Warrant in a private placement to the Sponsor, generating gross proceeds of $7,900,000, which is discussed in Note 4. Transaction costs amounted to $7,647,620 consisting of $2,600,000 of underwriting discount, $4,550,000 of deferred underwriting discount, and $497,620 of other offering costs. In addition, $2,494,203 of cash was held outside of the Trust Account (as defined below) and is available for working capital purposes. The Company 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 (as defined below) (excluding the deferred underwriting commissions and taxes payable on the interest earned on the Trust Account) at the time of the Company’s signing a definitive agreement in connection with the initial Business Combination. However, the Company 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 (the “Investment Company Act”). There is no assurance that the Company will be able to complete a Business Combination successfully. Following the closing of the IPO on January 27, 2022, an amount of $132,600,000 ($10.20 per Unit) from the net proceeds of the sale of the public units in the IPO and the sale of the Private Placement Warrants was placed in a Trust Account (“Trust Account”) and will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act that invest only in direct U.S. government treasury obligations. Except with respect to interest earned on the funds held in the Trust Account that may be released to the Company to pay its taxes, if any, the proceeds from the IPO and the sale of the Private Placement Warrants will not be released from the Trust Account until the earliest of (i) the completion of the initial Business Combination, (ii) the redemption of the public shares if the Company has not completed its initial Business Combination within 15 months from January 27, 2022 (or up to 21 months, if we extend the time to complete a business combination as described in the Company’s prospectus filed with the SEC on January 26, 2022 (the “Prospectus”) (the “Combination Period”), subject to applicable law, or (iii) the redemption of the public shares properly submitted in connection with a shareholder vote to amend the Company’s amended and restated memorandum and articles of association to (A) modify the substance or timing of the Company’s obligation to allow redemption in connection with the initial Business Combination or to redeem 100% of the public shares if the Company has not consummated an initial Business Combination within the Combination Period or (B) with respect to any other material provisions relating to shareholders’ rights or pre-initial Business Combination activity. The Company will provide its public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of the initial Business Combination either (i) in connection with a general meeting called to approve the initial Business Combination or (ii) without a shareholder vote by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a proposed initial Business Combination or conduct a tender offer will be made by the Company, solely in its discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require the Company to seek shareholder approval under applicable law or stock exchange listing requirements. The shareholders will be entitled to redeem their shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated 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 the Company to pay its taxes, divided by the number of then outstanding public shares, subject to the limitations and on conditions described in the Prospectus. The amount in the Trust Account is initially anticipated to be $10.20 per public share. The per-share amount the Company will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters. Ordinary shares subject to redemption are recorded at redemption value and classified as temporary equity following the completion of the IPO, in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” The Company will have 15 months from January 27, 2022 (or up to 21 months, if we extend the time to complete a business combination as described in the Prospectus) to consummate the initial Business Combination. If the Company has not consummated the initial Business Combination within the Combination Period, the Company will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than 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 (less taxes payable and 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 shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any) and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining shareholders and the Company’s board of directors, liquidate and dissolve, subject, in each case, to the Company’s obligations under Cayman Islands law to provide for claims of creditors and in all cases subject to the other requirements of applicable law. The Sponsor and each member of the management team have agreed to (i) waive their redemption rights with respect to their founder shares and public shares in connection with the completion of the initial Business Combination; (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to approve an amendment to the Company’s amended and restated memorandum and articles of association (A) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the initial Business Combination or to redeem 100% of the public shares if the Company has not consummated an initial Business Combination within the Combination Period or (B) with respect to any other material provisions relating to shareholders’ rights or pre-initial Business Combination activity; (iii) waive their rights to liquidating distributions from the Trust Account with respect to their founder shares if the Company fails to complete the initial Business Combination within the Combination Period, although they will be entitled to liquidating distributions from the Trust Account with respect to any public shares they hold if the Company fails to complete its initial Business Combination within the prescribed time frame; and (iv) vote any founder 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 the initial Business Combination. |
Significant Accounting Policies and Basis of Presentation |
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| Significant Accounting Policies and Basis of Presentation | Note 2—Significant Accounting Policies and Basis of Presentation Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in unaudited condensed financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Prospectus which contains the audited financial statements and notes thereto included in the Form 10-K annual report filed by the Company with the SEC on April 13, 2022. The interim results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future interim periods. Emerging Growth Company Status The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that 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 unaudited condensed 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 unaudited condensed financial statements in conformity with US 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 unaudited condensed financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. One of the more significant accounting estimates included in the unaudited condensed financial statements is the determination of the fair value of the warrant liability. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly from those estimates. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account. 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 did not have any cash equivalents as of September 30, 2022 and December 31, 2021. The Company held cash of $1,150,366 and $0 as of September 30, 2022 and December 31, 2021, respectively. Marketable Securities Held in Trust Account At September 30, 2022 and December 31, 2021, the Company held $133,390,345 and $0 in the Trust Account which consisted entirely of funds which invest only in cash and U.S. Treasury securities. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the balance sheets at fair value at the end of each reporting period. Dividend income from securities in the Trust Account is included in interest earned on marketable securities held in Trust Account in the accompanying condensed statements of operations. Unrealized gains and losses resulting from the change in fair value of investments held in Trust Account are included in the accompanying condensed statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under FASB ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the condensed balance sheets, primarily due to its short-term nature. Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The Company’s financial instruments are classified as either Level 1, Level 2 or Level 3. These tiers include:
Derivative Financial Instruments and Warrant and Over-allotment Liability The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 815-15. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity and measurement of fair value is re-assessed at the end of each reporting period. In accordance with ASC 825-10 “Financial Instruments”, offering costs attributable to the issuance of the derivative warrant liabilities and overallotment option have been allocated based on their relative fair value of total proceeds and are recognized in the condensed statements of operations as incurred. Derivative warrant liabilities are classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or the creation of current liabilities. The Company accounts for warrants and over-allotment as either equity-classified or liability-classified instruments based on an assessment of the warrant and over-allotment option’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants and over-allotment option are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants and over-allotment option meet all of the requirements for equity classification under ASC 815, including whether the warrants and over-allotment option are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment is conducted at the time of warrant and over-allotment option issuance and as of each subsequent quarterly period end date while the warrants and over-allotment option are outstanding. For warrants and over-allotment option that meet all of the criteria for equity classification, they are recorded as a component of additional paid-in capital at the time of issuance. For warrants and over-allotment that do not meet all the criteria for equity classification, they are required to be recorded as a liability at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants and over-allotment option are recognized as a non-cash gain or loss on the condensed statements of operations. The Company accounted for the Public Warrants (see Note 3), Private Placement Warrants (see Note 4) (together with the Public Warrants, the “Warrants”) and over-allotment option (Note 6) in accordance with the guidance contained in ASC 815-40. The Warrants and over-allotment are not considered indexed to the Company’s own ordinary shares, and as such, they do not meet the criteria for equity treatment and are recorded as liabilities. Income Taxes The Company accounts for income taxes under FASB ASC 740, “Income Taxes” (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the unaudited condensed financial statements and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized. FASB 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. There were no unrecognized tax benefits as of September 30, 2022 and December 31, 2021. The Company’s management determined that the Cayman Islands is the Company’s only major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of September 30, 2022 and December 31, 2021, there were no unrecognized tax benefits and no amounts were accrued for the payment of 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. There is currently no taxation imposed on income by the Government of the Cayman Islands. In accordance with Cayman income tax regulations, income taxes are not levied on the Company. Consequently, income taxes are not reflected in the Company’s unaudited condensed financial statements. Net Income (Loss) Per Share We comply with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net income per share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture by the Sponsor. At September 30, 2022 and December 31, 2021, weighted average shares were reduced for the effect of an aggregate of 487,500 Class B ordinary shares that were subject to forfeiture if the over-allotment option was not exercised by the underwriters. At September 30, 2022 and December 31, 2021, we did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in our earnings. As a result, diluted income per share is the same as basic income per share for the period presented. The table below presents a reconciliation of the numerator and denominator used to compute basic and diluted net income per share for each class of ordinary shares:
Offering Costs associated with the Initial Public Offering The Company complies with the requirements of ASC 340-10-S99-1, SEC Staff Accounting bulletin Topic 5A – “Expenses of Offering”, and SEC Staff Accounting bulletin Topic 5T – “Accounting for Expenses or Liabilities Paid by Principal Stockholder(s)”. Offering costs consist principally of professional and registration fees incurred through the balance sheet date that are related to the IPO. Offering costs directly attributable to the issuance of an equity contract to be classified in temporary equity are recorded as a reduction of equity. Offering costs for equity contracts that are classified as assets and liabilities are expensed immediately. The Company incurred offering costs amounting to $7,647,620 as a result of the IPO (consisting of $2,600,000 of underwriting fees, $4,550,000 of deferred underwriting fees, and $497,620 of other offering costs). The Company recorded $7,253,390 of offering costs as a reduction of temporary equity in connection with the Class A ordinary shares included in the Units. The Company immediately expensed $335,231 of offering costs in connection with the Public Warrants, Private Placement Warrants and over-allotment option that were classified as liabilities. Class A Shares Subject to Possible Redemption The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480. Ordinary shares subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature 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) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ deficit. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A ordinary shares subject to possible redemption is presented as temporary equity, outside of the shareholders’ deficit section of the Company’s condensed balance sheets. As of September 30, 2022, the amount of Class A ordinary shares reflected on the condensed balance sheets are reconciled in the following table:
Redeemable Share Classification The Company’s ordinary shares that will be sold as part of the Units in the IPO (“public ordinary shares”) contain a redemption feature which allows for the redemption of such public shares in connection with a shareholder vote or tender offer in connection with the Company’s initial Business Combination. In accordance with ASC 480-10-S99, the Company classifies public ordinary shares subject to redemption outside of permanent equity as the redemption provisions are not solely within the control of the Company. The public ordinary shares sold as part of the Units in the IPO will be issued with other freestanding instruments (i.e., Public Warrants) and as such, the initial carrying value of public ordinary shares classified as temporary equity, and the Public Warrants will be considered a derivative liability and as such, the fair value of the Public Warrants is bifurcated and presented as a liability. The public ordinary shares are subject to ASC 480-10-S99 and are currently not redeemable as the redemption is contingent upon the occurrence of events mentioned above. Recent Accounting Pronouncements The Company’s management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying financial statements. |
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Initial Public Offering |
9 Months Ended |
|---|---|
Sep. 30, 2022 | |
| Initial Public Offering | |
| Initial Public Offering | Note 3—Initial Public Offering On January 27, 2022, the Company consummated its IPO of 13,000,000 units at $10.00 per Unit, generating gross proceeds of $130,000,000. Each Unit consists of one Class A ordinary share and -half of one redeemable warrant (the “Public Warrants”). Each whole Public Warrant entitles the holder to purchase one Class A ordinary share at an exercise price of $11.50 per whole share. The Public Warrants will become exercisable 30 days after the completion of the initial business combination and expire five years after the completion of the initial business combination or earlier upon redemption or liquidation. |
Private Placement Warrants |
9 Months Ended |
|---|---|
Sep. 30, 2022 | |
| Private Placement Warrants | |
| Private Placement Warrants | Note 4—Private Placement Warrants Simultaneously with the closing of the IPO, the Sponsor purchased an aggregate of 7,900,000 warrants at a price of $1.00 per warrant (the “Private Placement Warrants”), for an aggregate purchase price of $7,900,000. The Private Placement Warrants are identical to the warrants sold in the IPO except that the Private Placement Warrants, so long as they are held by the Sponsor or its permitted transferees, (i) will not be redeemable by the Company, (ii) may not (including the Class A ordinary shares issuable upon exercise of these Private Placement Warrants), subject to certain limited exceptions, be transferred, assigned or sold by the holders until 30 days after the completion of the Company’s initial Business Combination, (iii) may be exercised by the holders on a cashless basis and (iv) will be entitled to registration rights. If the Private Placement Warrants are held by holders other than the Sponsor or its permitted transferees, the Private Placement Warrants will be redeemable by the Company in all redemption scenarios and exercisable by the holders on the same basis as the warrants included in the units being sold in the IPO. |
Related Party Transactions |
9 Months Ended |
|---|---|
Sep. 30, 2022 | |
| Related Party Transactions | |
| Related Party Transactions | Note 5—Related Party Transactions Founder Shares On June 2, 2021, the Sponsor paid $25,000, or approximately $0.007 per share, to cover certain offering costs in consideration for 3,737,500 Class B ordinary shares, par value $0.0001. Up to 487,500 Founder Shares were subject to forfeiture by the Sponsor depending on the extent to which the underwriters’ over-allotment option is exercised. In March 2022, the Sponsor effected a surrender of the 487,500 founder shares to the Company for no consideration upon expiration of the over-allotment option. The holders of the Company’s founder shares prior to the IPO (the “initial shareholders”) have agreed not to transfer, assign or sell any of their founder shares and any Class A ordinary shares issuable upon conversion thereof until the earlier to occur of: (i) one year after the completion of the initial Business Combination or (ii) the date on which the Company completes a liquidation, merger, share exchange or other similar transaction after the initial Business Combination that results in all of the shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. Any permitted transferees will be subject to the same restrictions and other agreements of the initial shareholders with respect to any founder shares (Lock-up). Notwithstanding the foregoing, if (1) the closing price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the initial Business Combination or (2) the Company consummates a transaction after the initial Business Combination which results in the shareholders having the right to exchange their shares for cash, securities or other property, the founder shares will be released from the lock-up. The sale or allocation of the Founders Shares to the Company’s director nominees and affiliates of its Sponsor group, as described above, is within the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The fair value of the 22,000 shares transferred to the Company’s consultants on April 1, 2022 was $101,640 or $4.62 per share. The Founders Shares were effectively sold subject to a performance condition (i.e., the occurrence of a Business Combination). Compensation expense related to the Founders Shares is recognized only when the performance condition is probable of occurrence under the applicable accounting literature in this circumstance. Stock-based compensation would be recognized at the date a Business Combination is considered probable in an amount equal to the number of Founders Shares times the grant date fair value per share (unless subsequently modified) less the amount initially received for the purchase of the Founders Shares. As of September 30, 2022, the Company determined that a Business Combination is not considered probable, and, therefore, no stock-based compensation expense has been recognized. Promissory Note—Related Party On June 2, 2021, the Sponsor agreed to loan the Company up to $300,000 to be used for a portion of the expenses of the IPO. These loans were non-interest bearing, unsecured and are due at the earlier of June 15, 2022 or the closing of the IPO. At the IPO date, the Company paid $142,350 to the Sponsor in full repayment of the promissory note. As of September 30, 2022 and December 31, 2021, the Company had borrowed $0 and $101,530 under the Promissory Note, respectively. Working Capital Loans In order to finance transaction costs in connection with an intended initial Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes its initial Business Combination, the Company would repay the Working Capital Loans. In the event that the initial Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay the Working Capital Loans but no proceeds from the Trust Account would be used to repay the Working Capital Loans. Up to $1,500,000 of the Working Capital Loans may be convertible into Private Placement Warrants of the post Business Combination entity at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the Private Placement Warrants. As of September 30, 2022 and December 31, 2021, the Company had no borrowings under the Working Capital Loans. |
Commitments & Contingencies |
9 Months Ended |
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Sep. 30, 2022 | |
| Commitments & Contingencies | |
| Commitments & Contingencies | Note 6—Commitments & Contingencies Registration and Shareholder Rights The holders of the (i) founder shares, which were issued in a private placement prior to the closing of the IPO, (ii) Private Placement Warrants, which were issued in a private placement simultaneously with the closing of the IPO and the Class A ordinary shares underlying such Private Placement Warrants and (iii) Private Placement Warrants that may be issued upon conversion of working capital loans have registration rights to require the Company to use its best efforts to register a sale of any of its securities held by them pursuant to a registration rights agreement. The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company registers such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the Company’s completion of the initial Business Combination. 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 option from the date of the IPO to purchase up to an additional 1,950,000 units to cover over-allotments, which expired unexercised on March 10, 2022. The underwriters received a cash underwriting discount of two percent (2%) of the gross proceeds of the IPO, or $2,600,000. Additionally, the underwriters will be entitled to a deferred underwriting discount of 3.5% of the gross proceeds of the IPO, or $4,550,000, upon the completion of the Company’s initial Business Combination. Forward Purchase Agreement An affiliate of the Sponsor (the “Sponsor Affiliate”) entered into a forward purchase agreement with the Company in connection with the IPO that provides for the purchase by the Sponsor Affiliate of an aggregate of up to 4,000,000 units, each consisting of one Class A ordinary share and -half of a warrant, for an aggregate purchase price of up to $40,000,000, in a private placement that will close simultaneously with the closing of the Company’s initial business combination. The proceeds from the sale of these forward purchase units, together with the amounts available to the Company from the trust account (after giving effect to any redemptions of public shares) and any other equity or debt financing obtained by the Company in connection with the business combination, will be used to satisfy the cash requirements of the business combination, including funding the purchase price and paying expenses and retaining specified amounts to be used by the post-business combination company for working capital or other purposes. To the extent that the amounts available from the trust account and other financing are sufficient for such cash requirements, the Sponsor Affiliate may purchase less than 4,000,000 forward purchase units. In addition, the Sponsor Affiliate’s commitment under the forward purchase agreement will be subject to the Sponsor Affiliate’s completing the raising of a new fund, approval of its investment committee as well as customary closing conditions under the forward purchase agreement. The forward purchase shares are identical to the Class A ordinary shares included in the units sold in the IPO, except that pursuant to the forward purchase agreement, they are not transferable, assignable or salable until 30 days after the completion of our initial business combination, subject to limited exceptions. The forward purchase warrants have the same terms as the private placement warrants. |
Shareholder's Deficit |
9 Months Ended |
|---|---|
Sep. 30, 2022 | |
| Shareholder's Deficit | |
| Shareholder's Deficit | Note 7—Shareholder’s Deficit Preference shares—The Company is authorized to issue 1,000,000 preference shares with a par value of $0.0001 and with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At September 30, 2022 and December 31, 2021, there were no shares of preference shares issued or outstanding. Class A ordinary shares—The Company is authorized to issue 200,000,000 Class A ordinary shares with a par value of $0.0001 per share. At September 30, 2022 and December 31, 2021, there were no shares of Class A ordinary shares issued or outstanding (excluding 13,000,000 shares subject to possible redemption). Class B ordinary shares—The Company is authorized to issue 20,000,000 Class B ordinary shares with a par value of $0.0001 per share. Holders are entitled to one vote for each share of Class B ordinary shares. At September 30, 2022 and December 31, 2021, there were 3,250,000 and 3,737,500 Class B ordinary shares and , respectively. Of the 3,737,500 Class B ordinary shares outstanding at December 31, 2021, an aggregate of up to 487,500 shares were subject to forfeiture to the Company for no consideration to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the initial shareholders would have collectively owned 20% of the Company’s issued and outstanding ordinary shares after the IPO. On March 10, 2022, the Sponsor effected a surrender of the 487,500 founder shares to the Company for no consideration upon expiration of the over-allotment option. Holders of Class A ordinary shares and holders of Class B ordinary shares will vote together as a single class on all matters submitted to a vote of the shareholders except as required by law. Unless specified in the Company’s amended and restated memorandum and articles of association, or as required by applicable provisions of the Companies Act or applicable stock exchange rules, the affirmative vote of a majority of the Company’s ordinary shares that are voted is required to approve any such matter voted on by its shareholders. The Class B ordinary shares will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of the initial Business Combination on a one-for-one basis, subject to adjustment for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional Class A ordinary shares or equity-linked securities are issued or deemed issued in connection with the initial Business Combination, the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, 20% of the total number of Class A ordinary shares outstanding after such conversion (after giving effect to any redemptions of Class A ordinary shares by public shareholders), including the total number of Class A ordinary shares issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial Business Combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, or to be issued, to any seller in the initial Business Combination and any Private Placement Warrants issued to the Sponsor, officers or directors upon conversion of working capital loans; provided that such conversion of founder shares will never occur on a less than one-for-one basis. |
Fair Value Measurements |
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| Fair Value Measurements | Note 8—Fair Value Measurements The following table presents information about the Company’s liabilities that are measured at fair value on September 30, 2022, and indicates the Level 3 fair value hierarchy of the valuation inputs the Company utilized to determine such fair value. At December 31, 2021, the Company had no financial assets and liabilities measured at fair value.
The Public Warrants and the Private Placement Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within liabilities on the condensed balance sheets. The warrant liabilities were measured at fair value at inception and remeasured on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed statements of operations. The overallotment option was accounted for as a liability in accordance with ASC 815-40 and was presented within liabilities on the condensed balance sheets from January 27, 2022 up to its expiration on March 10, 2022. The overallotment liability was measured at fair value at inception. The expiration of the overallotment resulted in a gain of $390,000 which is presented within gain on expiration of overallotment option in the condensed statements of operations. The Company used a Binomial Option Pricing Model to value the Private Placement Warrants and a Black-Scholes model to value the overallotment option. The Company allocated the proceeds received from (i) the sale of Units (which is inclusive of one share of Class A ordinary shares and -half of one Public Warrant), first to the warrants and overallotment option based on their fair values as determined at initial measurement, with the remaining proceeds allocated to Class A ordinary shares subject to possible redemption (temporary equity) based on their fair values at the initial measurement date. The Public Warrants, the Private Placement Warrants and overallotment option were classified within Level 3 of the fair value hierarchy at the initial measurement dates due to the use of unobservable inputs. Inherent in pricing models are assumptions related to expected share-price volatility, expected life and risk-free interest rate. The Company estimates the volatility of its ordinary shares based on historical volatility that matches the expected remaining life of the warrants. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the grant date for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants is assumed to be equivalent to their remaining contractual term. At September 30, 2022, the Company used the quoted price on Nasdaq to establish the fair value of the Public Warrants and transferred the Public Warrants from Level 3 to Level 1 due to the use of observable inputs. The key inputs into the Black-Scholes model of the overallotment option were as follows at inception date:
The Private Warrants were transferred to a Level 2 from a Level 3 during the nine months ended September 30, 2022, due to the use of an observable market quote for a similar asset in an active market. At September 30, 2022 the Company’s Public Warrant pricing was used to price the Private Warrants. The key inputs into the Binomial Option Pricing Model of the Private Placement Warrants were as follows at January 27, 2022 (initial measurement date):
The following table provides a summary of the changes in the fair value of the Company’s Level 3 financial instruments that are measured at fair value on a recurring basis:
As of December 31, 2021, the Company had no warrant liabilities measured at fair value. |
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Subsequent Events |
9 Months Ended |
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Sep. 30, 2022 | |
| Subsequent Events | |
| Subsequent Events | Note 9—Subsequent Events The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the unaudited condensed financial statements were issued. Based on this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the unaudited condensed financial statements. |
Significant Accounting Policies and Basis of Presentation (Policies) |
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| Basis of Presentation | Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in unaudited condensed financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Prospectus which contains the audited financial statements and notes thereto included in the Form 10-K annual report filed by the Company with the SEC on April 13, 2022. The interim results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future interim periods. |
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| Emerging Growth Company Status | Emerging Growth Company Status The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that 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 unaudited condensed 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. |
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| Use of Estimates | Use of Estimates The preparation of unaudited condensed financial statements in conformity with US 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 unaudited condensed financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. One of the more significant accounting estimates included in the unaudited condensed financial statements is the determination of the fair value of the warrant liability. Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly from those estimates. |
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| Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account. |
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| Cash and Cash Equivalents | 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 did not have any cash equivalents as of September 30, 2022 and December 31, 2021. The Company held cash of $1,150,366 and $0 as of September 30, 2022 and December 31, 2021, respectively. |
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| Marketable Securities Held in Trust Account | Marketable Securities Held in Trust Account At September 30, 2022 and December 31, 2021, the Company held $133,390,345 and $0 in the Trust Account which consisted entirely of funds which invest only in cash and U.S. Treasury securities. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the balance sheets at fair value at the end of each reporting period. Dividend income from securities in the Trust Account is included in interest earned on marketable securities held in Trust Account in the accompanying condensed statements of operations. Unrealized gains and losses resulting from the change in fair value of investments held in Trust Account are included in the accompanying condensed statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. |
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| Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under FASB ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the condensed balance sheets, primarily due to its short-term nature. Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The Company’s financial instruments are classified as either Level 1, Level 2 or Level 3. These tiers include:
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| Derivative Financial Instruments and Warrant and Over-allotment Liability | Derivative Financial Instruments and Warrant and Over-allotment Liability The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 815-15. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity and measurement of fair value is re-assessed at the end of each reporting period. In accordance with ASC 825-10 “Financial Instruments”, offering costs attributable to the issuance of the derivative warrant liabilities and overallotment option have been allocated based on their relative fair value of total proceeds and are recognized in the condensed statements of operations as incurred. Derivative warrant liabilities are classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or the creation of current liabilities. The Company accounts for warrants and over-allotment as either equity-classified or liability-classified instruments based on an assessment of the warrant and over-allotment option’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants and over-allotment option are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants and over-allotment option meet all of the requirements for equity classification under ASC 815, including whether the warrants and over-allotment option are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment is conducted at the time of warrant and over-allotment option issuance and as of each subsequent quarterly period end date while the warrants and over-allotment option are outstanding. For warrants and over-allotment option that meet all of the criteria for equity classification, they are recorded as a component of additional paid-in capital at the time of issuance. For warrants and over-allotment that do not meet all the criteria for equity classification, they are required to be recorded as a liability at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants and over-allotment option are recognized as a non-cash gain or loss on the condensed statements of operations. The Company accounted for the Public Warrants (see Note 3), Private Placement Warrants (see Note 4) (together with the Public Warrants, the “Warrants”) and over-allotment option (Note 6) in accordance with the guidance contained in ASC 815-40. The Warrants and over-allotment are not considered indexed to the Company’s own ordinary shares, and as such, they do not meet the criteria for equity treatment and are recorded as liabilities. |
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| Income Taxes | Income Taxes The Company accounts for income taxes under FASB ASC 740, “Income Taxes” (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the unaudited condensed financial statements and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized. FASB 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. There were no unrecognized tax benefits as of September 30, 2022 and December 31, 2021. The Company’s management determined that the Cayman Islands is the Company’s only major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of September 30, 2022 and December 31, 2021, there were no unrecognized tax benefits and no amounts were accrued for the payment of 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. There is currently no taxation imposed on income by the Government of the Cayman Islands. In accordance with Cayman income tax regulations, income taxes are not levied on the Company. Consequently, income taxes are not reflected in the Company’s unaudited condensed financial statements. |
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| Net Income (Loss) Per Share | Net Income (Loss) Per Share We comply with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net income per share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture by the Sponsor. At September 30, 2022 and December 31, 2021, weighted average shares were reduced for the effect of an aggregate of 487,500 Class B ordinary shares that were subject to forfeiture if the over-allotment option was not exercised by the underwriters. At September 30, 2022 and December 31, 2021, we did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in our earnings. As a result, diluted income per share is the same as basic income per share for the period presented. The table below presents a reconciliation of the numerator and denominator used to compute basic and diluted net income per share for each class of ordinary shares:
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| Offering Costs associated with the Initial Public Offering | Offering Costs associated with the Initial Public Offering The Company complies with the requirements of ASC 340-10-S99-1, SEC Staff Accounting bulletin Topic 5A – “Expenses of Offering”, and SEC Staff Accounting bulletin Topic 5T – “Accounting for Expenses or Liabilities Paid by Principal Stockholder(s)”. Offering costs consist principally of professional and registration fees incurred through the balance sheet date that are related to the IPO. Offering costs directly attributable to the issuance of an equity contract to be classified in temporary equity are recorded as a reduction of equity. Offering costs for equity contracts that are classified as assets and liabilities are expensed immediately. The Company incurred offering costs amounting to $7,647,620 as a result of the IPO (consisting of $2,600,000 of underwriting fees, $4,550,000 of deferred underwriting fees, and $497,620 of other offering costs). The Company recorded $7,253,390 of offering costs as a reduction of temporary equity in connection with the Class A ordinary shares included in the Units. The Company immediately expensed $335,231 of offering costs in connection with the Public Warrants, Private Placement Warrants and over-allotment option that were classified as liabilities. |
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| Class A Common Stock Subject to Possible Redemption | Class A Shares Subject to Possible Redemption The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480. Ordinary shares subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature 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) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ deficit. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A ordinary shares subject to possible redemption is presented as temporary equity, outside of the shareholders’ deficit section of the Company’s condensed balance sheets. As of September 30, 2022, the amount of Class A ordinary shares reflected on the condensed balance sheets are reconciled in the following table:
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| Redeemable Share Classification | Redeemable Share Classification The Company’s ordinary shares that will be sold as part of the Units in the IPO (“public ordinary shares”) contain a redemption feature which allows for the redemption of such public shares in connection with a shareholder vote or tender offer in connection with the Company’s initial Business Combination. In accordance with ASC 480-10-S99, the Company classifies public ordinary shares subject to redemption outside of permanent equity as the redemption provisions are not solely within the control of the Company. The public ordinary shares sold as part of the Units in the IPO will be issued with other freestanding instruments (i.e., Public Warrants) and as such, the initial carrying value of public ordinary shares classified as temporary equity, and the Public Warrants will be considered a derivative liability and as such, the fair value of the Public Warrants is bifurcated and presented as a liability. The public ordinary shares are subject to ASC 480-10-S99 and are currently not redeemable as the redemption is contingent upon the occurrence of events mentioned above. |
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| Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company’s management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying financial statements. |
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Significant Accounting Policies and Basis of Presentation (Tables) |
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| Significant Accounting Policies and Basis of Presentation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of reconciliation of basic and diluted net income per share for each class of ordinary shares |
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| Schedule of reconciliation Class A ordinary shares reflected on the balance sheet | As of September 30, 2022, the amount of Class A ordinary shares reflected on the condensed balance sheets are reconciled in the following table:
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Fair Value Measurements (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Fair Value Measurements | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Company's liabilities that are measured at fair value on a recurring basis |
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| Schedule of quantitative information regarding Level 3 fair value measurements inputs |
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| Schedule of change in the fair value of the warrant liabilities |
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Organization and Business Operation (Details) - USD ($) |
9 Months Ended | ||
|---|---|---|---|
Jan. 27, 2022 |
Sep. 30, 2022 |
Dec. 31, 2021 |
|
| Initial Public Offering | |||
| Proceeds from private placement | $ 7,900,000 | ||
| Transaction costs | $ 7,647,620 | ||
| Underwriting discount | 2,600,000 | ||
| Deferred underwriting discount | 4,550,000 | ||
| Other offering costs | 497,620 | ||
| Cash held outside of the Trust Account | $ 2,494,203 | $ 1,150,366 | |
| Threshold minimum aggregate fair market value as a percentage of the net assets held in the Trust Account | 80.00% | ||
| Threshold percentage of outstanding voting securities of the target to be acquired by post-transaction Company to complete Business Combination | 50.00% | ||
| Share price | $ 10.20 | ||
| Redemption of shares calculated based on business days prior to consummation of business combination (in days) | 185 days | ||
| Period to consummate the initial Business Combination | 15 months | ||
| Period to consummate the initial Business Combination, if time extend to Complete Business Combination | 21 months | ||
| Obligation to redeem Public Shares if entity does not complete a Business Combination (as a percent) | 100.00% | ||
| Threshold business days for redemption of public shares | 10 days | ||
| Maximum net interest to pay dissolution expenses | $ 100,000 | ||
| Cash on hand | 1,150,366 | $ 0 | |
| Working Capital | 1,188,383 | ||
| Cash held outside the Trust Account | $ 1,150,000 | ||
| Initial Public Offering | |||
| Initial Public Offering | |||
| Number of units sold | 13,000,000 | ||
| Purchase price, per unit | $ 10.00 | ||
| Gross proceeds from issuance initial public offering | $ 130,000,000 | ||
| Net proceeds from issuance initial public offering | $ 132,600,000 | ||
| Share price | $ 10.20 | ||
| Private Placement | Private Placement Warrants | |||
| Initial Public Offering | |||
| Number of warrants issued | 7,900,000 | ||
| Price of warrant | $ 1.00 | ||
| Proceeds from private placement | $ 7,900,000 |
Significant Accounting Policies and Basis of Presentation (Details) - USD ($) |
9 Months Ended | ||
|---|---|---|---|
Sep. 30, 2022 |
Jan. 27, 2022 |
Dec. 31, 2021 |
|
| Cash equivalents | $ 0 | $ 0 | |
| Cash held | 1,150,366 | 0 | |
| Marketable securities held in Trust Account | 133,390,345 | 0 | |
| Unrecognized tax benefits | 0 | 0 | |
| Unrecognized tax benefits accrued for interest and penalties | 0 | $ 0 | |
| Offering costs | $ 7,647,620 | ||
| Underwriting fees | 2,600,000 | ||
| Deferred underwriting fees | 4,550,000 | ||
| Other offering costs | $ 497,620 | ||
| Offering costs as a reduction of temporary equity | 7,253,390 | ||
| Warrant issuance costs | $ 335,231 | ||
| Class B ordinary shares | |||
| Shares subject to forfeiture | 487,500 | 487,500 |
Significant Accounting Policies and Basis of Presentation - Reconciliation of basic and diluted net income per share for each class of ordinary shares (Details) - USD ($) |
3 Months Ended | 4 Months Ended | 9 Months Ended | |
|---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2021 |
Sep. 30, 2022 |
|
| Class A ordinary shares | ||||
| Allocation of net (loss) income | $ (668,480) | $ 6,232,270 | ||
| Weighted average shares outstanding, basic | 13,000,000 | 11,718,978 | ||
| Weighted average shares outstanding, diluted | 13,000,000 | 0 | 0 | 11,718,978 |
| Basic net (loss) income per share | $ (0.05) | $ 0.53 | ||
| Diluted net (loss) income per share | $ (0.05) | $ 0.00 | $ 0.00 | $ 0.53 |
| Class B ordinary shares | ||||
| Allocation of net (loss) income | $ (167,120) | $ (1,442) | $ (91,442) | $ 1,728,383 |
| Weighted average shares outstanding, basic | 3,250,000 | 3,250,000 | 3,250,000 | 3,250,000 |
| Weighted average shares outstanding, diluted | 3,250,000 | 3,250,000 | 3,250,000 | 3,250,000 |
| Basic net (loss) income per share | $ (0.05) | $ 0.00 | $ (0.03) | $ 0.53 |
| Diluted net (loss) income per share | $ (0.05) | $ 0.00 | $ (0.03) | $ 0.53 |
Significant Accounting Policies and Basis of Presentation - Reconciliation Class A ordinary shares reflected on the balance sheet (Details) - Class A ordinary shares subject to possible redemption - USD ($) |
3 Months Ended | 6 Months Ended |
|---|---|---|
Mar. 31, 2022 |
Sep. 30, 2022 |
|
| Gross proceeds from IPO | $ 130,000,000 | |
| Fair value of proceeds allocated to Public Warrants | (4,940,000) | |
| Fair value of proceeds allocated to overallotment liability | (390,000) | |
| Class A ordinary shares issuance cost | (7,312,390) | |
| Remeasurement of Class A ordinary shares subject to possible redemption | 15,242,390 | $ 790,345 |
| Class A ordinary shares subject to possible redemption | $ 132,600,000 | $ 133,390,345 |
Initial Public Offering (Details) - USD ($) |
9 Months Ended | |
|---|---|---|
Jan. 27, 2022 |
Sep. 30, 2022 |
|
| Public Warrants | ||
| Initial Public Offering | ||
| Number of warrants in a unit | 0.50 | |
| Public Warrants expiration term after the completion of a business combination | 30 days | |
| Public Warrants expiration term | 5 years | |
| Initial Public Offering | ||
| Initial Public Offering | ||
| Number of units sold | 13,000,000 | |
| Purchase price, per unit | $ 10.00 | |
| Gross proceeds from issuance initial public offering | $ 130,000,000 | |
| Number of shares in a unit | 1 | |
| Number of shares issuable per warrant | 1 | |
| Initial Public Offering | Public Warrants | ||
| Initial Public Offering | ||
| Number of warrants in a unit | 0.50 | |
| Exercise price of warrants | $ 11.50 |
Private Placement Warrants (Details) - USD ($) |
9 Months Ended | |
|---|---|---|
Jan. 27, 2022 |
Sep. 30, 2022 |
|
| Private Placement Warrants | ||
| Aggregate purchase price | $ 7,900,000 | |
| Private Placement | Private Placement Warrants | ||
| Private Placement Warrants | ||
| Number of warrants issued | 7,900,000 | |
| Price of warrants | $ 1.00 | |
| Aggregate purchase price | $ 7,900,000 | |
| Warrants to be transferred, assigned or sold, term | 30 days |
Related Party Transactions - Founder Shares (Details) |
1 Months Ended | 9 Months Ended | ||||
|---|---|---|---|---|---|---|
|
Apr. 01, 2022
USD ($)
$ / shares
shares
|
Mar. 10, 2022
USD ($)
|
Jun. 02, 2021
USD ($)
$ / shares
shares
|
Mar. 31, 2022
USD ($)
shares
|
Sep. 30, 2022
D
$ / shares
shares
|
Dec. 31, 2021
$ / shares
shares
|
|
| Related Party Transaction | ||||||
| Consideration of shares surrendered for cancellation | $ | $ 0 | |||||
| Price per share | $ 10.20 | |||||
| Class B ordinary shares | ||||||
| Related Party Transaction | ||||||
| Common shares, par value (per share) | $ 0.0001 | $ 0.0001 | ||||
| Shares subject to forfeiture | shares | 487,500 | 487,500 | ||||
| Consideration of shares surrendered for cancellation | $ | $ 0 | |||||
| Founder Shares | ||||||
| Related Party Transaction | ||||||
| Restrictions on transfer period of time after business combination completion | 1 year | |||||
| Stock price trigger to transfer, assign or sell any shares or warrants of the company, after the completion of the initial business combination (in dollars per share) | $ 12.00 | |||||
| Threshold trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | D | 20 | |||||
| Threshold consecutive trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | D | 30 | |||||
| Threshold period after the business combination in which the 20 trading days within any 30 trading day period commences | 150 days | |||||
| Founder Shares | Maximum | ||||||
| Related Party Transaction | ||||||
| Shares subject to forfeiture | shares | 487,500 | |||||
| Founder Shares | Sponsor | ||||||
| Related Party Transaction | ||||||
| Number of shares surrendered for cancellation | shares | 487,500 | |||||
| Consideration of shares surrendered for cancellation | $ | $ 0 | |||||
| Number of shares transferred | shares | 22,000 | |||||
| Fair value | $ | $ 101,640 | |||||
| Price per share | $ 4.62 | |||||
| Founder Shares | Sponsor | Class B ordinary shares | ||||||
| Related Party Transaction | ||||||
| Consideration received | $ | $ 25,000 | |||||
| Purchase price, per unit | $ 0.007 | |||||
| Number of shares issued | shares | 3,737,500 | |||||
| Common shares, par value (per share) | $ 0.0001 |
Related Party Transactions - Promissory Note - Related Party (Details) - USD ($) |
9 Months Ended | |||
|---|---|---|---|---|
Jan. 27, 2022 |
Sep. 30, 2022 |
Dec. 31, 2021 |
Jun. 02, 2021 |
|
| Related Party Transaction | ||||
| Repayment of promissory note - related party | $ 142,350 | |||
| Promissory Note - Related Party | ||||
| Related Party Transaction | ||||
| Maximum borrowing capacity of related party promissory note | $ 300,000 | |||
| Repayment of promissory note - related party | $ 142,350 | |||
| Outstanding balance of related party note | $ 0 | $ 101,530 |
Related Party Transactions - Working Capital Loans (Details) - Working Capital Loans - USD ($) |
Sep. 30, 2022 |
Dec. 31, 2021 |
|---|---|---|
| Related Party Transaction | ||
| Working Capital Loans convertible into warrants | $ 1,500,000 | |
| Price of warrant | $ 1.00 | |
| Outstanding balance of related party note | $ 0 | $ 0 |
Commitments & Contingencies (Details) |
9 Months Ended | |
|---|---|---|
|
Jan. 27, 2022
USD ($)
shares
|
Sep. 30, 2022
USD ($)
item
shares
|
|
| Commitments & Contingencies | ||
| Maximum number of demands for registration of securities | item | 3 | |
| Deferred underwriting discount | $ | $ 4,550,000 | |
| Class A ordinary shares | ||
| Commitments & Contingencies | ||
| Number of shares in a unit | 1 | |
| Underwriting Agreement | ||
| Commitments & Contingencies | ||
| Underwriters Option Period | 45 days | |
| Number of units sold | 1,950,000 | |
| Cash underwriting discount, percentage | 2.00% | |
| Underwriter cash discount | $ | $ 2,600,000 | |
| Deferred Underwriting Discount, Percentage | 3.50% | |
| Deferred underwriting discount | $ | $ 4,550,000 | |
| Forward Purchase Agreement | Sponsor Affiliate | ||
| Commitments & Contingencies | ||
| Number of units sold | 4,000,000 | |
| Number of warrants in a unit | 0.50 | |
| Gross proceeds from issuance of Units | $ | $ 40,000,000 | |
| Number of Units purchased | 4,000,000 | |
| Forward Purchase Agreement | Class A ordinary shares | Sponsor Affiliate | ||
| Commitments & Contingencies | ||
| Number of shares in a unit | 1 |
Shareholder's Deficit - Preferred Stock Shares (Details) - $ / shares |
Sep. 30, 2022 |
Dec. 31, 2021 |
|---|---|---|
| Shareholder's Deficit | ||
| Preferred shares, shares authorized | 1,000,000 | 1,000,000 |
| Preferred stock, par value, (per share) | $ 0.0001 | $ 0.0001 |
| Preferred shares, shares issued | 0 | 0 |
| Preferred shares, shares outstanding | 0 | 0 |
Shareholder's Deficit - Common Stock Shares (Details) |
1 Months Ended | 9 Months Ended | 12 Months Ended | ||||
|---|---|---|---|---|---|---|---|
|
Mar. 10, 2022
USD ($)
shares
|
Mar. 31, 2022
USD ($)
shares
|
Sep. 30, 2022
Vote
$ / shares
shares
|
Dec. 31, 2021
USD ($)
$ / shares
shares
|
||||
| Class of Stock | |||||||
| Number of Founder shares surrendered | 487,500 | ||||||
| Consideration of shares surrendered for cancellation | $ | $ 0 | ||||||
| Class A ordinary shares | |||||||
| Class of Stock | |||||||
| Common shares, shares authorized (in shares) | 200,000,000 | 200,000,000 | |||||
| Common shares, par value (per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||
| Common shares, shares issued (in shares) | 0 | 0 | |||||
| Common shares, shares outstanding (in shares) | 0 | 0 | |||||
| Ratio to be applied to the stock in the conversion | 20 | ||||||
| Class A ordinary shares subject to possible redemption | |||||||
| Class of Stock | |||||||
| Class A common stock subject to possible redemption, outstanding (in shares) | 13,000,000 | 0 | |||||
| Class A ordinary shares not subject to possible redemption | |||||||
| Class of Stock | |||||||
| Common shares, shares issued (in shares) | 0 | 0 | |||||
| Common shares, shares outstanding (in shares) | 0 | 0 | |||||
| Class B ordinary shares | |||||||
| Class of Stock | |||||||
| Common shares, shares authorized (in shares) | 20,000,000 | 20,000,000 | |||||
| Common shares, par value (per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||
| Common shares, votes per share | Vote | 1 | ||||||
| Common shares, shares issued (in shares) | 3,250,000 | 3,737,500 | [1] | ||||
| Common shares, shares outstanding (in shares) | 3,250,000 | 3,737,500 | [1] | ||||
| Shares subject to forfeiture | 487,500 | 487,500 | |||||
| Consideration of Shares Forfeited | $ | $ 0 | ||||||
| Ratio to be applied to the stock in the conversion | 20 | ||||||
| Number of Founder shares surrendered | 487,500 | ||||||
| Consideration of shares surrendered for cancellation | $ | $ 0 | ||||||
| |||||||
Fair Value Measurements (Details) |
9 Months Ended |
|---|---|
|
Sep. 30, 2022
USD ($)
shares
| |
| Liabilities, Fair Value Disclosure | |
| Warrant liabilities | $ 2,880,000 |
| Gain on expiration of overallotment option | $ 390,000 |
| Public Warrants | |
| Liabilities, Fair Value Disclosure | |
| Number of warrants in a unit | shares | 0.50 |
| Recurring | |
| Liabilities, Fair Value Disclosure | |
| Warrant liabilities | $ 2,880,000 |
| Recurring | Private Placement Warrants | |
| Liabilities, Fair Value Disclosure | |
| Warrant liabilities | 1,580,000 |
| Recurring | Public Warrants | |
| Liabilities, Fair Value Disclosure | |
| Warrant liabilities | $ 1,300,000 |
| Class A ordinary shares | |
| Liabilities, Fair Value Disclosure | |
| Number of shares in a unit | shares | 1 |
| Level 1 | Recurring | |
| Liabilities, Fair Value Disclosure | |
| Warrant liabilities | $ 1,300,000 |
| Level 1 | Recurring | Public Warrants | |
| Liabilities, Fair Value Disclosure | |
| Warrant liabilities | 1,300,000 |
| Level 2 | Recurring | |
| Liabilities, Fair Value Disclosure | |
| Warrant liabilities | 1,580,000 |
| Level 2 | Recurring | Private Placement Warrants | |
| Liabilities, Fair Value Disclosure | |
| Warrant liabilities | $ 1,580,000 |
Fair Value Measurements - Level 3 Fair Value Measurements Inputs (Details) - Level 3 |
Jan. 27, 2022
Y
$ / shares
item
|
|---|---|
| Risk-free interest rate | Binomial Option Pricing Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | 0.0126 |
| Risk-free interest rate | Black-Scholes Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | 0.0008 |
| Expected term (years) | Binomial Option Pricing Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | Y | 4.5 |
| Expected term (years) | Black-Scholes Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | Y | 0.13 |
| Expected volatility | Binomial Option Pricing Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | 0.150 |
| Expected volatility | Black-Scholes Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | 0.0380 |
| Exercise price | Binomial Option Pricing Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | item | 11.50 |
| Exercise price | Black-Scholes Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | item | 10.00 |
| Stock price | Binomial Option Pricing Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | $ / shares | 9.62 |
| Fair value of overallotment unit | Black-Scholes Model | |
| Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |
| Derivative Liability, Measurement Input | 0.20 |
Fair Value Measurements - Change in the Fair Value of the Warrant Liabilities (Details) - USD ($) |
3 Months Ended | |||
|---|---|---|---|---|
Mar. 10, 2022 |
Jan. 27, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
|
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Fair value at the Beginning | $ 0 | |||
| Level 1 | Warrants | ||||
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Transfer to Level | (1,592,500) | |||
| Level 1 | Public Warrants | ||||
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Transfer to Level | (1,592,500) | |||
| Level 2 | Warrants | ||||
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Transfer to Level | $ (948,000) | |||
| Level 2 | Private Placement Warrants | ||||
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Transfer to Level | (948,000) | |||
| Level 3 | Warrants | ||||
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Fair value at the Beginning | 1,975,000 | 0 | ||
| Initial measurement at January 27, 2022 | $ 10,944,000 | |||
| Change in fair value of warrant liabilities | (1,027,000) | (7,376,500) | ||
| Fair value at the end | 1,975,000 | |||
| Level 3 | Private Placement Warrants | ||||
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Fair value at the Beginning | 1,975,000 | 0 | ||
| Initial measurement at January 27, 2022 | 6,004,000 | |||
| Change in fair value of warrant liabilities | $ (1,027,000) | (4,029,000) | ||
| Fair value at the end | 1,975,000 | |||
| Level 3 | Public Warrants | ||||
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Fair value at the Beginning | 0 | |||
| Initial measurement at January 27, 2022 | 4,940,000 | |||
| Change in fair value of warrant liabilities | (3,347,500) | |||
| Level 3 | Overallotment Liability | ||||
| Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | ||||
| Fair value at the Beginning | $ 0 | |||
| Initial measurement at January 27, 2022 | $ 390,000 | |||
| Expiration of overallotment option on March 10, 2022 | $ (390,000) | |||