Financial Performance - As of December 31, 2023, the company had net income of $695,617, primarily from interest income of $581,496 and changes in fair value of derivative liabilities [148]. - For the nine months ended December 31, 2023, the company reported net income of $2,829,161, with interest income of $2,981,390 and changes in fair value of derivative liabilities totaling $1,450,000 [150]. - For the nine months ended December 31, 2023, net cash used in operating activities was $889,088, primarily due to non-cash adjustments related to derivative liabilities [156]. - The company incurred $60,000 and $180,000 in general and administrative expenses for the three and nine months ended December 31, 2023, respectively [163]. - The company has not commenced any operations and has not generated any revenues to date [147]. Financial Position - The company had a working capital deficit of approximately $2.8 million as of December 31, 2023 [153]. - The company had $121,635 in cash held outside the Trust Account as of December 31, 2023, which may not be sufficient for operations for at least 12 months [161]. Debt and Financing - The company borrowed $710,440 under the First and Second Lexasure Loans, with a maximum combined loan amount of $1,000,000 [155]. - The underwriters of the IPO received a cash underwriting discount of $0.20 per Unit, totaling $4,600,000, and a deferred fee of $0.35 per Unit, amounting to $8,050,000, contingent upon completing a Business Combination [165]. - The Capital Markets Advisory Fee for the First Strategic Advisor is set at $1,500,000 plus an Incremental Advisory Fee based on Trust Proceeds, which could range from $250,000 to $2,500,000 depending on the amount [166]. - The Second Strategic Advisor will purchase 250,000 Class B ordinary shares at a price of $0.04 per share, totaling $10,000, upon consummation of a Business Combination [167]. - The Forward Purchase Agreement allows the Forward Purchase Investor to purchase up to $20.0 million Forward Purchase Units at $10.00 per Unit, which will close concurrently with the Business Combination [174]. Regulatory and Compliance - The company has the right to terminate the Lexasure Business Combination Agreement if PCAOB audited financials are not received by December 31, 2023 [142]. - The company filed a Definitive Proxy Statement to extend the deadline for consummating a Business Combination to March 3, 2025 [145]. - The Company recognized the remeasurement of redeemable Class A Ordinary Shares immediately upon the IPO closing, impacting additional paid-in capital and accumulated deficit [171]. - Net income (loss) per share for non-redeemable Class A and Class B Ordinary Shares is calculated by adjusting net income (loss) for redeemable Class A Ordinary Shares, with no dilutive securities affecting the calculation [172]. - Public and Private Placement Warrants are classified as liabilities and re-measured at fair value at each reporting period, with an initial charge of $1,532,700 recorded for the excess fair value of private warrant liabilities [173]. - The Company adopted ASU 2020-06, simplifying accounting for convertible instruments, with no impact on its financial position or results of operations [175]. - The Company is classified as a smaller reporting company and is not required to provide certain market risk disclosures [176].
CAPITALWORKS EME(CMCAU) - 2024 Q3 - Quarterly Report