Plum Acquisition(PLMJ) - 2022 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION This section presents the financial information for Alpha Partners Technology Merger Corp Condensed Financial Statements This section presents Alpha Partners Technology Merger Corp.'s unaudited condensed financial statements, detailing its balance sheets, operations, shareholder deficit, and cash flows Condensed Balance Sheets As of June 30, 2022, total assets were $284.7 million, liabilities $11.7 million, and shareholders' deficit improved to $9.9 million from $15.7 million Condensed Balance Sheet Summary (as of June 30, 2022 vs. December 31, 2021) | Metric | June 30, 2022 (Unaudited) | December 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash | $1,392,907 | $2,124,185 | | Investments held in Trust Account | $282,918,132 | $282,508,321 | | Total Assets | $284,703,486 | $285,166,743 | | Liabilities & Shareholders' Deficit | | | | Warrant liabilities | $1,258,767 | $8,276,150 | | Deferred underwriting fee payable | $9,887,500 | $9,887,500 | | Total Liabilities | $11,666,983 | $18,356,904 | | Class A ordinary shares subject to possible redemption | $282,918,132 | $282,508,321 | | Total Shareholders' Deficit | ($9,881,629) | ($15,698,482) | Condensed Statements of Operations Net income for the three and six months ended June 30, 2022, was $3.0 million and $6.2 million, primarily due to non-cash gains from warrant liabilities Statements of Operations Highlights (Unaudited) | Metric | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | Operating and formation costs | ($575,990) | ($1,200,530) | | Interest and dividend income on investments | $381,481 | $409,811 | | Change in fair value of warrant liabilities | $3,203,124 | $7,017,383 | | Net income | $3,008,615 | $6,226,664 | | Basic and diluted net income per share, Class A | $0.08 | $0.17 | Condensed Statements of Changes in Shareholders' Deficit Shareholders' deficit improved from $15.7 million to $9.9 million by June 30, 2022, driven by $6.2 million net income - The total shareholders' deficit decreased from $(15,698,482) on January 1, 2022, to $(9,881,629) on June 30, 2022[19] - The primary drivers for the change in shareholders' deficit during the first six months of 2022 were net income of $6,226,664 and remeasurement of Class A ordinary shares to redemption amount totaling $(409,811)[19] Condensed Statements of Cash Flows Net cash used in operating activities was $731,278 for the six months ended June 30, 2022, with cash decreasing to $1.4 million Cash Flow Summary (Six Months Ended June 30, 2022) | Cash Flow Activity | Amount | | :--- | :--- | | Net cash used in operating activities | ($731,278) | | Net cash provided by financing activities | $0 | | Net Change in Cash | ($731,278) | | Cash - Beginning of period | $2,124,185 | | Cash - End of period | $1,392,907 | Notes to Condensed Financial Statements (Unaudited) Notes detail the company's blank check status, going concern warning, warrant liability classification, and related party transactions - The Company is a blank check company formed to effect a Business Combination and has not commenced any operations, with a 24-month deadline from its IPO closing (July 30, 2021) to complete a transaction[25][38] - Management has determined that the company's liquidity condition and the July 30, 2023, deadline to complete a Business Combination raise substantial doubt about its ability to continue as a going concern[45] - The company accounts for its public, private, and founder warrants as liabilities at fair value, with changes recognized in the statement of operations due to terms precluding equity classification under ASC 815-40[113][116] - The fair value of warrant liabilities decreased significantly, resulting in a gain of $7.0 million for the six months ended June 30, 2022, with Founder and Private Placement Warrants estimated at $0.12 each as of June 30, 2022, down from $0.78 at year-end 2021[130][128] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's financial condition and results, highlighting its non-operating nature, reliance on non-cash gains, and liquidity challenges as a blank check company - The company's activities are limited to organizational tasks and identifying a target for a business combination, having generated no operating revenues to date[144] - Net income for the six months ended June 30, 2022, was $6.2 million, primarily from a $7.0 million non-cash gain on warrant liability fair value, offset by $1.2 million in operating costs[146] - As of June 30, 2022, the company had $1,392,907 in cash held outside the Trust Account to fund its search for a business combination and other operating expenses[151] - The company has a deferred underwriting commission of $9,887,500, payable from the Trust Account only upon Business Combination completion[158] - Management acknowledges that the company may have insufficient funds to operate for the next year and may need to obtain additional financing to complete a business combination[155] Quantitative and Qualitative Disclosures About Market Risk This item is not applicable as the company is a smaller reporting company - The company is a smaller reporting company and is therefore not required to provide the information requested under this item[168] Controls and Procedures Management concluded disclosure controls were ineffective due to a material weakness in accounting for complex financial instruments, with remediation efforts underway - A material weakness was identified in the company's internal control over financial reporting concerning the accounting for complex financial instruments, leading to initial misclassification of warrants as equity instead of liabilities[170] - As of June 30, 2022, management concluded that the company's disclosure controls and procedures were not effective due to this material weakness[171] - Remediation efforts are underway, including enhancing processes to apply complex accounting standards and increasing consultation with third-party professionals[172] PART II - OTHER INFORMATION This section provides other required information, including legal proceedings, risk factors, and exhibits Legal Proceedings The company reports no legal proceedings to disclose - The company has no legal proceedings to report[173] Risk Factors Updated risk factors include potential adverse effects from SEC's proposed SPAC rules and geopolitical instability impacting business combination efforts - The SEC's proposed rules on SPACs, issued March 30, 2022, may adversely affect the company's ability to negotiate and complete its Business Combination and could increase related costs and time[176] - Geopolitical conditions, particularly the invasion of Ukraine by Russia and subsequent sanctions, could materially and adversely affect the company's search for a Business Combination and the operations of a potential target business[177][178][179] Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities or use of proceeds - The company reports 'None' for this item[181] Defaults Upon Senior Securities The company reports no defaults upon senior securities - The company reports 'None' for this item[182] Mine Safety Disclosures This item is not applicable to the company - This item is not applicable[183] Other Information The company reports no other information - The company reports 'None' for this item[184] Exhibits This section lists exhibits filed with the Quarterly Report on Form 10-Q, including officer certifications and XBRL data - The exhibits filed with the report include certifications from the Principal Executive Officer and Principal Financial Officer, as required by the Sarbanes-Oxley Act, and XBRL interactive data files[186]