Business Combination and Operations - The company has until January 7, 2025, to complete a Business Combination, or it will cease operations and redeem Public Shares at a price equal to the amount in the Trust Account[148]. - The Business Combination Agreement was entered into on June 24, 2024, involving a merger with Nidar, which includes share conversions and the separation of units[155][156]. - The company has faced risks related to its ability to select appropriate target businesses and complete the initial business combination[145]. - The company does not expect to generate operating revenues until after the completion of its Business Combination[169]. - The company may lack sufficient funds to consummate the Business Combination due to the termination of the Forward Purchase Agreement with the Cartica Funds[188]. - The company has until January 7, 2025, to consummate a Business Combination, with substantial doubt raised about its ability to continue as a going concern if not completed by that date[183]. Financial Performance - For the three months ended June 30, 2024, the company reported a net loss of $3,973,890, which includes a change in fair value of warrant liabilities of $2,148,000 and operating costs of $2,174,582, offset by interest income of $348,692[170]. - For the six months ended June 30, 2024, the company had a net loss of $7,876,134, consisting of a change in fair value of warrant liabilities of $4,225,000 and operating costs of $4,583,133, with interest income of $931,999[172]. - The company’s net income for the six months ended June 30, 2023, was $5,085,516, driven by interest income of $5,473,593[173]. - The company incurred cash used in operating activities of $1,052,233 for the six months ended June 30, 2024, compared to $870,139 for the same period in 2023[177][178]. - The company’s results of operations may be adversely affected by economic uncertainties, including inflation and geopolitical instability[174]. Trust Account and Cash Management - As of June 30, 2024, the company had cash held in the Trust Account amounting to $25,486,129, which includes $2,197,083 of interest income[179]. - The company has liquidated investments in the Trust Account and is now holding funds in an interest-bearing demand deposit account[150]. - The company plans to deposit $40,000 monthly into the Trust Account until January 7, 2025, for the benefit of Public Shares not redeemed during the extension[152]. - As of June 30, 2024, the company had cash of $19,294, which will be used for identifying and evaluating target businesses and completing a Business Combination[180]. Debt and Financing - The Working Capital Note was amended multiple times in 2024, increasing the principal sum from $300,000 to $1,750,000, with a total borrowing of $1,063,500 under its terms[151]. - The company has a Working Capital Note, which was amended to increase the principal sum to $1,750,000, with $1,313,500 drawn and outstanding as of June 30, 2024[176]. - As of June 30, 2024, the company had no outstanding borrowings under the Working Capital Loans, with up to $2,000,000 of such loans convertible into warrants at $1.00 per warrant[182]. - The company issued an Extension Note in April 2024, allowing the sponsor to loan up to $360,000, with a total of $120,000 deposited in the Trust Account for the three and six months ended June 30, 2024[181][190]. Compliance and Regulatory Matters - The company received a Nasdaq Delisting Notice on April 16, 2024, due to non-compliance with the Minimum Total Holders Rule, but was granted continued listing on the Nasdaq Capital Market on June 17, 2024[153][154]. - The company’s securities were transferred to the Nasdaq Capital Market on July 12, 2024, after demonstrating compliance with listing rules[154]. - The company is subject to new SEC rules for SPACs effective July 1, 2024, which may impact its ability to negotiate and complete the Business Combination[149]. Accounting and Reporting - The company does not believe that the adoption of recently issued accounting standards will have a material effect on its condensed financial statements[200]. - The Company is classified as an "emerging growth company" under the JOBS Act, allowing it to take advantage of certain reporting exemptions[201]. - The Company has chosen not to opt out of the extended transition period for new or revised financial accounting standards, aligning its adoption with private companies[202]. - As a smaller reporting company, the Company is not required to provide detailed market risk disclosures[203]. Warrants and Underwriting - The company had 27,400,000 warrants issued and outstanding as of June 30, 2024, including 11,500,000 Public warrants classified as Level 1[195]. - The underwriter received a cash underwriting discount of $4,600,000 and a deferred fee of $8,050,000, which will only be payable if a Business Combination is completed[187].
Cartica Acquisition Corp(CITEU) - 2024 Q2 - Quarterly Report