Financial Position - As of September 30, 2024, the company had $13,000 in cash and a working capital deficit of $858,000[108]. - As of September 30, 2024, approximately $13,000 is available outside of the trust account to fund working capital requirements, raising concerns about operational sustainability[128]. - The company has not generated any operating revenues to date and has incurred increased expenses related to being a public company and due diligence for potential business combinations[120]. - The company has not entered into any off-balance sheet arrangements or commitments for capital expenditures as of September 30, 2024, indicating a conservative financial approach[130]. Business Combination Efforts - The company entered into a Business Combination Agreement with Tembo, with a total consideration of $838 million to be paid entirely in newly issued ordinary shares valued at $10.00 each[112]. - The company intends to apply for up-listing on the Nasdaq Stock Market upon completion of the business combination with Tembo[119]. - The company has engaged in discussions with potential business combination targets but has not yet reached a definitive agreement[105]. - A significant percentage of public shareholders have elected to redeem their shares, which may further reduce cash resources and necessitate third-party financing for a successful business combination[129]. - The company may need to secure financing by issuing additional securities simultaneously with the completion of a business combination, but there is no assurance that this will be successful[129]. Compliance and Regulatory Issues - The company received a notice from Nasdaq regarding non-compliance with the MVPHS Rule, requiring a minimum market value of publicly held shares of $15 million, and has until November 4, 2024, to regain compliance[113]. - On November 1, 2024, the company extended its mandatory liquidation date from November 2, 2024, to November 2, 2025, with 1,148,799 Class A ordinary shares redeemed, leaving 3,926,071 shares outstanding[116]. Financing and Debt - As of September 30, 2024, the company had issued a promissory note to ARWM Inc Pte. Ltd. for up to $500,000, with a maturity date extended to June 30, 2025[122]. - The company has been in discussions to extend the maturity date of a $600,000 promissory note issued to Energi Holding Limited past November 1, 2024[124]. - The company has requested additional loans from third parties but has not secured any additional funding to date, which may hinder the ability to complete an initial business combination[128]. Use of Funds - The company intends to use substantially all funds in the trust account for the initial business combination, with remaining proceeds allocated for working capital and growth strategies[125]. - The company is using proceeds held outside the trust account primarily for identifying and evaluating target businesses, which includes due diligence and negotiation costs[126]. - The net proceeds from the initial public offering and the sale of private warrants are invested in U.S. government treasury bills with a maturity of 185 days or less, minimizing exposure to interest rate risk[133]. Operational Concerns - There is uncertainty regarding the ability to continue operations if the initial business combination is not completed due to insufficient funds, with a potential liquidation date within 12 months[128]. - The company has entered into a non-redemption agreement with a third party, where the third party agreed not to redeem 500,000 Class A ordinary shares in exchange for 125,000 founder shares[117]. - The company has not established any special purpose entities or guaranteed any debt or commitments of other entities, maintaining a straightforward financial structure[130].
Cactus Acquisition Corp. 1 Ltd.(CCTSU) - 2024 Q3 - Quarterly Report