CERo Therapeutics(CERO) - 2023 Q3 - Quarterly Report

Financial Performance - As of September 30, 2023, the Company reported a net loss of $334,028 for the three months ended, primarily due to general and administrative expenses of $429,801 and provision for income taxes of $25,751, partially offset by interest income of $121,524 [135]. - For the nine months ended September 30, 2023, the Company had a net loss of $2,253,473, consisting of general and administrative expenses of $2,563,647 and provision for income taxes of $70,409, with interest income of $380,583 providing partial offset [137]. Financial Position - The Company had $119,014 in its operating bank accounts and approximately $8.3 million in the Trust Account as of September 30, 2023, indicating a working capital deficit of $4,568,584 [141][133]. - The Company has no long-term debt or off-balance sheet arrangements as of September 30, 2023, and has incurred a $35,000 outstanding balance owed to the Sponsor for administrative services [148][149]. IPO and Business Combination - The Company completed its IPO on October 8, 2021, raising gross proceeds of $175 million from 17,500,000 Units sold at $10.00 per Unit, with an additional $8.85 million from the sale of 885,000 Placement Units [139]. - The Company entered into a business combination agreement with CERo Therapeutics, Inc. on June 4, 2023, which includes the issuance of approximately 5.0 million shares of Class A common stock as consideration [128][129]. - The Company incurred $12,729,318 in transaction costs related to the IPO, including $2,635,000 in underwriting fees and $9,150,000 in deferred underwriting fees [140]. Trust Account and Financing - The Sponsor has made several deposits into the Trust Account, totaling $37,051.83 for the extension of the business combination deadline, with additional deposits of $8,845.59, $22,949, and $22,949 made in subsequent months [132]. - The Company anticipates using substantially all funds in the Trust Account to complete its Business Combination, with potential additional financing required if significant Public Shares are redeemed [144][146]. Going Concern - The Company has raised concerns regarding its ability to continue as a going concern for a reasonable period, projecting insufficient funds to cover expenses over the next year without additional capital [147]. Fees and Accounting - The company has a deferred fee agreement of $9,150,000 payable to the underwriter, contingent upon completing a Business Combination [152]. - The company accounts for warrants as either equity or liability classified instruments based on specific terms and guidance, concluding that Public and Private Placement Warrants qualify for equity accounting treatment [154]. - Common stock subject to possible redemption is classified as temporary equity due to certain redemption rights considered outside of the company's control [155]. - As of September 30, 2023, the company reported no dilutive securities, resulting in diluted net (loss) income per share being the same as basic net (loss) income per share [156]. - The company adopted ASU 2016-13 on January 1, 2023, which did not impact its financial statements [157].