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TKB Critical Technologies 1(USCT) - 2024 Q1 - Quarterly Report
USCTTKB Critical Technologies 1(USCT)2024-05-14 20:05

Financial Performance - For the three months ended March 31, 2024, the company reported a net income of 279,184,consistingofinterestearnedonmarketablesecuritiesof279,184, consisting of interest earned on marketable securities of 305,713 and a change in fair value of warrant liabilities of 242,525,offsetbyoperationalcostsof242,525, offset by operational costs of 269,054[168]. - For the three months ended March 31, 2023, the company experienced a net loss of 4,671,643,whichincludedachangeinfairvalueofwarrantliabilitiesof4,671,643, which included a change in fair value of warrant liabilities of 2,854,675 and operational costs of 2,876,950,offsetbyinterestearnedonmarketablesecuritiesof2,876,950, offset by interest earned on marketable securities of 1,184,982[169]. Marketable Securities and Cash - As of March 31, 2024, the company had marketable securities held in the trust account amounting to 23,817,744,includingapproximately23,817,744, including approximately 1,661,537 of interest income and unrealized gains[177]. - The company had cash of 9,128heldoutsidethetrustaccountasofMarch31,2024,intendedforidentifyingandevaluatingtargetbusinessesandrelatedduediligence[178].InitialPublicOffering−Thecompanyraisedgrossproceedsof9,128 held outside the trust account as of March 31, 2024, intended for identifying and evaluating target businesses and related due diligence[178]. Initial Public Offering - The company raised gross proceeds of 230,000,000 from its initial public offering of 23,000,000 units at 10.00perunitonOctober29,2021[171].−Transactioncostsoftheinitialpublicofferingtotaled10.00 per unit on October 29, 2021[171]. - Transaction costs of the initial public offering totaled 21,140,059, which included 3,850,000ofunderwritingdiscountand3,850,000 of underwriting discount and 8,800,000 of deferred underwriting discount[174]. - The underwriters of the initial public offering are entitled to a deferred fee of 8,800,000,whichwaswaivedinJune2023[185].BusinessCombinationandGoingConcern−ThecompanyextendedthedeadlineforcompletingitsinitialbusinesscombinationfromJune29,2023,toOctober29,2024,withshareholderapproval[165].−Thecompanyexpectstoincursignificantcostsrelatedtoidentifyingatargetbusinessandconductingduediligence,raisingsubstantialdoubtaboutitsabilitytocontinueasagoingconcern[180].−Thecompanyassessedgoingconcernconsiderationsanddeterminedthatliquidityconditionsraisesubstantialdoubtaboutitsabilitytocontinueasagoingconcern[182].FinancialObligationsandLiabilities−AsofMarch31,2024,thecompanyhaddrawn8,800,000, which was waived in June 2023[185]. Business Combination and Going Concern - The company extended the deadline for completing its initial business combination from June 29, 2023, to October 29, 2024, with shareholder approval[165]. - The company expects to incur significant costs related to identifying a target business and conducting due diligence, raising substantial doubt about its ability to continue as a going concern[180]. - The company assessed going concern considerations and determined that liquidity conditions raise substantial doubt about its ability to continue as a going concern[182]. Financial Obligations and Liabilities - As of March 31, 2024, the company had drawn 925,172 on a promissory note for up to 1,000,000,whichisnon−interestbearingandpayableupontheconsummationofaninitialbusinesscombinationorliquidation[179].−AsofMarch31,2024,thecompanyhasnooff−balancesheetfinancingarrangementsorobligations[183].−Thecompanydoesnothaveanylong−termdebtobligationsorcapitalleaseobligations[184].AccountingandReporting−Thecompanyaccountsforwarrantliabilitiesbasedonspecifictermsandapplicableguidance,requiringprofessionaljudgment[187].−Thecompanyhas22,250,000warrantsexercisabletopurchaseClassAShares,withnodilutivesecuritiesasofMarch31,2024[191].−Thecompanyrecognizeschangesinredemptionvalueofordinarysharesimmediately,adjustingthecarryingvaluetoequaltheredemptionvalueateachreportingperiod[190].−ThecompanyiscurrentlyassessingtheimpactofASU2020−06,effectiveafterDecember15,2023,onitsfinancialposition[192].−ThecompanyisevaluatingthetimingandimpactsofadoptingASU2023−09,effectivefortheannualperiodendingDecember31,2025[193].−Themanagementdoesnotbelievethatanyrecentlyissuedaccountingstandardswillhaveamaterialeffectonthefinancialstatements[194].AdministrativeCosts−Thecompanyincurredamonthlyfeeof1,000,000, which is non-interest bearing and payable upon the consummation of an initial business combination or liquidation[179]. - As of March 31, 2024, the company has no off-balance sheet financing arrangements or obligations[183]. - The company does not have any long-term debt obligations or capital lease obligations[184]. Accounting and Reporting - The company accounts for warrant liabilities based on specific terms and applicable guidance, requiring professional judgment[187]. - The company has 22,250,000 warrants exercisable to purchase Class A Shares, with no dilutive securities as of March 31, 2024[191]. - The company recognizes changes in redemption value of ordinary shares immediately, adjusting the carrying value to equal the redemption value at each reporting period[190]. - The company is currently assessing the impact of ASU 2020-06, effective after December 15, 2023, on its financial position[192]. - The company is evaluating the timing and impacts of adopting ASU 2023-09, effective for the annual period ending December 31, 2025[193]. - The management does not believe that any recently issued accounting standards will have a material effect on the financial statements[194]. Administrative Costs - The company incurred a monthly fee of 10,000 for office space and administrative support from October 29, 2021, until the agreement was terminated on June 28, 2023[184].