Integral Acquisition Corporation 1(INTEU) - 2022 Q1 - Quarterly Report

Part I. Financial Information Financial Statements For the quarter ended March 31, 2022, the company reported a $1.28 million net loss, primarily due to an unrealized loss on the Forward Purchase Agreement liability, with total assets at $118.1 million and a $6.8 million stockholders' deficit Condensed Balance Sheet Data (Unaudited) | Account | March 31, 2022 | December 31, 2021 | | :--- | :--- | :--- | | Total Assets | $118,116,758 | $118,482,043 | | Investments held in trust account | $116,747,688 | $116,733,409 | | Total Liabilities | $8,175,786 | $7,263,587 | | Forward Purchase Agreement liability | $2,013,491 | $1,007,934 | | Deferred underwriting commission | $6,050,000 | $6,050,000 | | Class A common stock subject to possible redemption | $116,725,000 | $116,725,000 | | Total stockholders' deficit | ($6,784,028) | ($5,506,544) | Condensed Statement of Operations (Unaudited) | Description | For the Three Months ended March 31, 2022 | For the period from Feb 16, 2021 (inception) through Mar 31, 2021 | | :--- | :--- | :--- | | Formation and operating costs | $286,206 | $18,048 | | Unrealized loss on change in fair value of FPA liability | ($1,005,557) | — | | Interest income | $14,279 | — | | Net loss | ($1,277,484) | ($18,048) | Condensed Statement of Cash Flows (Unaudited) | Description | For the three months ended March 31, 2022 | | :--- | :--- | | Net cash used in operating activities | ($358,805) | | Net cash provided by financing activities | $0 | | Cash, end of the period | $950,360 | Notes to Unaudited Condensed Financial Statements The notes highlight the company's SPAC status and May 5, 2023 deadline for a business combination, raising substantial doubt about its going concern ability, alongside commitments like a $6.05 million deferred underwriting commission and a $20,000 monthly administrative fee * The company, a blank check company, must complete a business combination within 18 months of its IPO (November 5, 2021) or face liquidation, raising substantial doubt about its going concern ability[22][34][41] * A Forward Purchase Agreement (FPA) with Crescent Park and Carnegie Park allows for the purchase of up to 3,000,000 Class A common stock shares, accounted for as a fair value liability[91][59] Change in Fair Value of FPA Liability | Date | Fair Value | | :--- | :--- | | December 31, 2021 | $1,007,934 | | March 31, 2022 | $2,013,491 | | Change in fair value (Unrealized Loss) | $1,005,557 | * The company pays its Sponsor $20,000 per month for administrative support, starting from its Nasdaq listing date[83] * A deferred underwriting commission of $6,050,000 is payable from the Trust Account to underwriters only upon completing an Initial Business Combination[88] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's pre-business combination SPAC status, highlighting a $1.28 million net loss for the quarter and reiterating substantial doubt about its going concern ability due to the May 5, 2023 business combination deadline * The company, a blank check entity, must complete an initial Business Combination by May 5, 2023 (18 months from IPO) or face liquidation[118][123] * As of March 31, 2022, the company held approximately $1.0 million in its operating bank account and $1.1 million in working capital, with post-IPO liquidity met by warrant private placement proceeds[124][125] * For the three months ended March 31, 2022, the company incurred a net loss of $1,277,484, primarily from $286,206 in operating costs and a $1,005,557 unrealized FPA liability loss, partially offset by $14,279 in interest income[129] * Management concluded that mandatory liquidation without a business combination raises substantial doubt about the company's ability to continue as a going concern[126] Quantitative and Qualitative Disclosures Regarding Market Risk The company's market risk is limited to interest rate risk on Trust Account funds, invested in short-term U.S. government treasury obligations, which management deems immaterial * The company's activities are limited to organizational efforts and target searching, with no revenue generation or hedging activities[155] * Trust Account proceeds are invested in short-term U.S. government treasury bills or money market funds, minimizing material interest rate risk exposure[156] Controls and Procedures As of March 31, 2022, management concluded disclosure controls and procedures were ineffective due to a material weakness in financial reporting related to fair value calculation errors and unrecorded liabilities * As of March 31, 2022, principal officers concluded the company's disclosure controls and procedures were not effective[159] * Ineffectiveness stemmed from a material weakness in fair value calculation errors for financial instruments and unrecorded liabilities[159] * No material changes to internal control over financial reporting occurred during the quarter[160] Part II. Other Information Legal Proceedings The company reported no legal proceedings * None[163] Risk Factors The primary risk is a material weakness in internal control over financial reporting, potentially impacting accurate financial reporting and investor confidence * The company identified material weaknesses in internal control over financial reporting concerning fair value calculation errors and unrecorded liabilities[164] * A material weakness could lead to undetected financial misstatements, potentially causing a loss of investor confidence and stock price decline[165][166] Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities or use of proceeds during the period * None[168] Defaults Upon Senior Securities The company reported no defaults upon senior securities * None[169] Mine Safety Disclosures This item is not applicable to the company * Not applicable[170] Other Information The company reported no other information * None[171] Exhibits This section lists exhibits filed with the Quarterly Report on Form 10-Q, including officer certifications and Inline XBRL documents * Exhibits include Certifications of Principal Executive and Financial Officers under Sarbanes-Oxley Act Sections 302 and 906, along with Inline XBRL data files[173]