Trailblazer Merger I(TBMC) - 2025 Q1 - Quarterly Report

Part I. Financial Information This section presents the unaudited interim financial statements, management's discussion and analysis, market risk disclosures, and internal controls Item 1. Interim Financial Statements This section presents the unaudited condensed consolidated financial statements for Trailblazer Merger Corporation I, including the balance sheets, statements of operations, changes in stockholders' deficit, and cash flows for the periods ended March 31, 2025 and 2024, along with comprehensive notes explaining the company's organization, accounting policies, and significant transactions Condensed Consolidated Balance Sheets This section provides a snapshot of the company's financial position, detailing assets, liabilities, and stockholders' deficit at specific reporting dates Assets (March 31, 2025 vs. December 31, 2024) | Metric | March 31, 2025 | December 31, 2024 | | :--------------------------------- | :------------- | :---------------- | | Cash | $37,305 | $63,829 | | Cash – restricted | $802,993 | $802,993 | | Prepaid expenses | $5,227 | $34,834 | | Total current assets | $845,525 | $901,656 | | Marketable securities held in Trust Account | $27,278,757 | $26,832,298 | | Total Assets | $28,124,282 | $27,733,954 | Liabilities and Stockholders' Deficit (March 31, 2025 vs. December 31, 2024) | Metric | March 31, 2025 | December 31, 2024 | | :--------------------------------- | :------------- | :---------------- | | Accounts payable and accrued expenses | $1,571,294 | $1,189,196 | | Income taxes payable | $959,754 | $894,699 | | Excise tax payable | $497,749 | $497,749 | | Promissory note related party | $2,923,445 | $2,529,445 | | Total current liabilities | $5,952,242 | $5,111,089 | | Deferred underwriting fee payable | $2,070,000 | $2,070,000 | | Total Liabilities | $8,022,242 | $7,181,089 | | Class A common stock subject to possible redemption | $26,965,556 | $26,634,152 | | Accumulated deficit | $(6,863,728) | $(6,081,499) | | Total Stockholders' Deficit | $(6,863,516) | $(6,081,287) | | Total Liabilities and Stockholders' Deficit | $28,124,282 | $27,733,954 | Condensed Consolidated Statements of Operations This section details the company's financial performance, presenting revenues, expenses, and net income or loss over specific periods Operating Results (Three Months Ended March 31, 2025 vs. 2024) | Metric | March 31, 2025 | March 31, 2024 | Change (YoY) | | :------------------------------------------------ | :------------- | :------------- | :----------- | | General and administrative expenses | $665,655 | $388,331 | +$277,324 | | Loss from operations | $(665,655) | $(388,331) | -$277,324 | | Interest earned on marketable securities held in Trust Account | $279,885 | $953,592 | -$673,707 | | Unrealized loss on marketable securities held in Trust Account | $0 | $(3,973) | +$3,973 | | Other income, net | $279,885 | $949,619 | -$669,734 | | (Loss) Income before provision for income taxes | $(385,770) | $561,288 | -$947,058 | | Provision for income taxes | $(65,055) | $(188,920) | +$123,865 | | Net (loss) income | $(450,825) | $372,368 | -$823,193 | | Basic and diluted net (loss) income per share, Class A common stock | $(0.10) | $0.04 | -$0.14 | Condensed Consolidated Statements of Changes in Stockholders' Deficit This section outlines changes in the company's equity, including net income/loss and adjustments to common stock and accumulated deficit Stockholders' Deficit Changes (Three Months Ended March 31, 2025) | Metric | December 31, 2024 Balance | Remeasurement of carrying value to redemption value | Net loss | March 31, 2025 Balance | | :--------------------------------- | :------------------------ | :---------------------------------------- | :------- | :--------------------- | | Class A Common Stock Amount | $212 | $0 | $0 | $212 | | Class B Common Stock Amount | $0 | $0 | $0 | $0 | | Additional Paid-in Capital | $0 | $0 | $0 | $0 | | Accumulated Deficit | $(6,081,499) | $(331,404) | $(450,825) | $(6,863,728) | | Total Stockholders' Deficit | $(6,081,287) | $(331,404) | $(450,825) | $(6,863,516) | Stockholders' Deficit Changes (Three Months Ended March 31, 2024) | Metric | December 31, 2023 Balance | Remeasurement of carrying value to redemption value | Net income | March 31, 2024 Balance | | :--------------------------------- | :------------------------ | :---------------------------------------- | :--------- | :--------------------- | | Class A Common Stock Amount | $212 | $0 | $0 | $212 | | Class B Common Stock Amount | $0 | $0 | $0 | $0 | | Additional Paid-in Capital | $0 | $0 | $0 | $0 | | Accumulated Deficit | $(1,677,270) | $(1,400,699) | $372,368 | $(2,705,601) | | Total Stockholders' Deficit | $(1,677,058) | $(1,400,699) | $372,368 | $(2,705,389) | Condensed Consolidated Statements of Cash Flows This section reports the company's cash inflows and outflows from operating, investing, and financing activities over specific periods Cash Flows from Operating Activities (Three Months Ended March 31, 2025 vs. 2024) | Metric | March 31, 2025 | March 31, 2024 | Change (YoY) | | :------------------------------------------------ | :------------- | :------------- | :----------- | | Net (loss) income | $(450,825) | $372,368 | -$823,193 | | Net cash used in operating activities | $(253,950) | $(182,106) | -$71,844 | Cash Flows from Investing Activities (Three Months Ended March 31, 2025 vs. 2024) | Metric | March 31, 2025 | March 31, 2024 | Change (YoY) | | :------------------------------------------------ | :------------- | :------------- | :----------- | | Extension deposit into Trust Account | $(166,574) | $(690,000) | +$523,426 | | Net cash used in investing activities | $(166,574) | $(537,073) | +$370,499 | Cash Flows from Financing Activities (Three Months Ended March 31, 2025 vs. 2024) | Metric | March 31, 2025 | March 31, 2024 | Change (YoY) | | :------------------------------------------------ | :------------- | :------------- | :----------- | | Proceeds from promissory note – related party | $394,000 | $690,000 | -$296,000 | | Net cash provided by financing activities | $394,000 | $690,000 | -$296,000 | Notes to Condensed Consolidated Financial Statements This section provides detailed explanations and disclosures for the condensed consolidated financial statements, covering the company's business operations, significant accounting policies, initial public offering, private placement, related party transactions, commitments, contingencies, stockholders' deficit, fair value measurements, segment information, and subsequent events NOTE 1. Description of Organization and Business Operations Trailblazer Merger Corporation I is a blank check company incorporated on November 12, 2021, for the purpose of effectuating a business combination[20] As of March 31, 2025, the Company has not commenced operations and generates non-operating income from interest on IPO proceeds, having entered a merger agreement with Cyabra Strategy Ltd. on July 22, 2024, where Holdings will be the public company and Cyabra a wholly-owned subsidiary post-merger[21][22] The company has extended its business combination deadline multiple times, most recently to May 31, 2025, with potential for further extensions to September 30, 2025, and the Sponsor has deposited funds for these extensions[32][34][37] Management has determined that the company lacks sufficient liquidity to sustain operations for one year and faces substantial doubt about its ability to continue as a going concern if a Business Combination is not consummated by the mandatory liquidation date[43] The company recorded a 1% excise tax payable of $497,749 as of March 31, 2025, related to stock redemptions, which was due on April 30, 2025, and remains unpaid, incurring interest and penalties[47] NOTE 2. Summary of Significant Accounting Policies The unaudited condensed consolidated financial statements are prepared in accordance with GAAP for interim financial information, with certain disclosures condensed or omitted per SEC rules[49] The Company is an "emerging growth company" under the JOBS Act, electing to use the extended transition period for new or revised financial accounting standards, which may affect comparability with other public companies[52][53] Public Shares subject to redemption are classified outside of permanent equity at redemption value, with changes recognized immediately against additional paid-in capital and accumulated deficit[60] As of March 31, 2025, the Company reported a net deferred tax liability of $0, and a deferred tax asset of $349,844 was fully offset by a valuation allowance, resulting in an effective tax rate of (16.86)% for the three months ended March 31, 2025[62] The Company adopted ASU 2023-07 on Segment Reporting effective January 1, 2024, with no material effect, and is evaluating ASU 2023-09 on Income Tax Disclosures, effective for fiscal years beginning after December 15, 2024[73][74] NOTE 3. Initial Public Offering The Company sold 6,900,000 Units at $10.00 per Unit, including the full exercise of the over-allotment option, generating gross proceeds of $69,000,000, with each Unit consisting of one Class A common stock share and one right to receive one-tenth of a Class A common stock share[76] NOTE 4. Private Placement The Sponsor purchased 394,500 Placement Units at $10.00 per Unit, generating $3,945,000, with proceeds added to the Trust Account and these units expiring worthless if a Business Combination is not completed[77] NOTE 5. Related Party Transactions The Sponsor initially purchased 1,940,625 Founder Shares (Class B common stock), which were later exchanged for Class A common stock and a single Class B share, with the Sponsor agreeing to lock-up periods and waiver of redemption/liquidation rights for these shares[78][80][31] The Company has an unsecured, non-interest bearing promissory note with the Sponsor, which has been amended multiple times to increase the maximum borrowing amount, most recently to $3,530,000 on February 21, 2025, with $2,923,445 outstanding as of March 31, 2025[81][82] The Sponsor or affiliates may provide Working Capital Loans to fund deficiencies or transaction costs, with no amounts outstanding as of March 31, 2025, or December 31, 2024[83] NOTE 6. Commitments and Contingencies Holders of Founder Shares, Placement Units, and Working Capital Loan conversion units are entitled to registration rights, allowing them to register these securities for resale after applicable lock-up periods[84] Underwriters received a cash discount of $1,035,000 and are entitled to a deferred fee of $2,070,000, payable from the Trust Account upon completion of a Business Combination[86] The Company agreed to pay LifeSci Capital LLC 1.5% of the total consideration of the initial business combination in equity interests for advisory services, plus reimbursement for out-of-pocket expenses[88][91] On July 22, 2024, the Company entered into a merger agreement with Cyabra Strategy Ltd., structuring a business combination where Trailblazer merges into Holdings, and Cyabra becomes a wholly-owned subsidiary of Holdings (to be renamed "Cyabra, Inc."), with the agreement amended on November 11, 2024, to adjust board size, plan size, and extend the closing date to March 1, 2025[92][93][94] The Company plans a private placement (PIPE Investment) of at least $6,000,000 in Holdings Common Stock to close concurrently with the Business Combination, which may be reduced if the Trust Account balance exceeds $3,500,000 after redemptions, with no PIPE investment provided to date[100][101] NOTE 7. Stockholders' Deficit Authorized and Outstanding Shares (March 31, 2025 & December 31, 2024) | Class | Authorized Shares | Issued & Outstanding Shares | | :------------------ | :---------------- | :-------------------------- | | Preferred Stock | 1,000,000 | 0 | | Class A Common Stock | 100,000,000 | 2,119,499 (excluding 2,379,616 subject to redemption) | | Class B Common Stock | 5,000,000 | 1 | The holder of the single Class B common stock share has the right to elect all directors prior to the initial business combination, while Class A and Class B common stockholders vote together on other matters, except for charter amendments related to authorized shares, where they vote as separate classes[105] Each Public Right automatically converts into one-tenth of one share of common stock upon consummation of a Business Combination, with fractional shares rounded down[106][107] NOTE 8. Fair Value Measurements The Company uses a fair value hierarchy (Level 1, 2, 3) to classify assets and liabilities based on observable and unobservable inputs[109][114] Marketable Securities Held in Trust Account (March 31, 2025 vs. December 31, 2024) | Metric | March 31, 2025 | December 31, 2024 | | :--------------------------------- | :------------- | :---------------- | | Marketable securities held in Trust Account (Level 1) | $27,278,757 | $26,832,298 | NOTE 9. Segment Information The Company's Chief Executive Officer and Chief Financial Officer (CODM) review the Company's assets, operating results, and financial metrics as a whole, determining there is only one reportable segment[115] The CODM monitors general and administrative expenses and interest earned on the Trust Account to manage cash, forecast capital needs for a business combination, and ensure compliance[116][117] NOTE 10. Subsequent Events The Sponsor deposited $83,287 into the Trust Account on April 1, 2025, to extend the Business Combination Termination Date to April 30, 2025, and another $83,287 on May 2, 2025, to extend it to May 31, 2025[120] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the Company's financial condition and operational results, including an overview of its blank check company status, recent developments regarding the proposed business combination with Cyabra, extensions of the combination period, and a detailed analysis of its liquidity, capital resources, and going concern considerations, also discussing critical accounting estimates and recent accounting standards Overview This section provides a general introduction to the company's business, its purpose as a blank check company, and potential impacts of future transactions Trailblazer Merger Corporation I is a blank check company formed to effectuate a business combination, utilizing IPO proceeds, private placement funds, and potential future equity/debt issuances[123] Issuance of additional shares for a business combination may significantly dilute existing equity interests, subordinate common stock rights, cause a change in control, delay control changes, and adversely affect market prices[124] Incurring significant debt could lead to default, acceleration of obligations, inability to obtain additional financing, substantial cash flow usage for debt service, limitations on business flexibility, increased vulnerability to adverse conditions, and other disadvantages[128] Recent Developments This section outlines key recent events, including the proposed merger, financing activities, and extensions to the business combination deadline On July 22, 2024, Trailblazer entered into a merger agreement with Cyabra Strategy Ltd., structuring a business combination where Trailblazer merges into Holdings, and Cyabra becomes a wholly-owned subsidiary of Holdings (to be renamed "Cyabra, Inc.")[126][127] Cyabra shareholders will receive Holdings Common Stock based on a Conversion Ratio, with Earnout Shares (up to 3,000,000) potentially issued based on future stock price targets, and Cyabra Key Employees receiving 400,000 shares[129][130][131] A private placement (PIPE Investment) of at least $6,000,000 in Holdings Common Stock is planned to close concurrently with the Business Combination, subject to reduction if Trust Account funds exceed $3,500,000 after redemptions[132] Alpha Capital Anstalt, an affiliate of the Sponsor, provided Cyabra with $3.4 million in convertible promissory notes (2024 Convertible Notes), with an additional $2.6 million raised from other purchasers, and also provided a $1.0 million non-interest bearing promissory note (2025 Note) to Cyabra on February 28, 2025, due April 30, 2025, or prior to the Business Combination[133] The Company's board approved multiple extensions for completing a business combination, from March 31, 2024, to September 30, 2025, with the Sponsor depositing funds into the Trust Account for these extensions[135][136][138][141] In connection with the September 26, 2024 Annual Meeting, 4,520,384 shares were tendered for redemption, resulting in a withdrawal of $49,774,936 from the Trust Account on October 9, 2024[142] Results of Operations This section analyzes the company's financial performance, focusing on revenue, expenses, and net income or loss for the reporting periods The Company reported a net loss of $450,825 for the three months ended March 31, 2025, primarily due to general and administrative expenses of $665,655 and income tax provision of $65,055, partially offset by $279,885 in interest income from the Trust Account[144] For the three months ended March 31, 2024, the Company had a net income of $372,368, driven by $953,592 in interest income, offset by general and administrative expenses of $388,331, income tax provision of $188,920, and an unrealized loss of $3,973[145] Liquidity, Capital Resources and Going Concern This section discusses the company's cash position, funding sources, and management's assessment of its ability to continue operations As of March 31, 2025, the Company had $37,305 in its operating bank account and $802,993 in restricted cash for taxes, with most funds held in the Trust Account, unavailable until a business combination[146] The IPO generated $69,000,000 from 6,900,000 units, and a private placement with the Sponsor generated $3,945,000 from 394,500 units, totaling $70,380,000 deposited into the Trust Account[147][148][149] The Sponsor deposited $1,879,719 into the Trust Account through March 31, 2025, for extensions, which was loaned via a promissory note amended to a maximum of $3,530,000, with $2,923,445 outstanding as of March 31, 2025[151][152][153] Management has identified substantial doubt about the Company's ability to continue as a going concern due to insufficient liquidity for operations and the uncertainty of completing a Business Combination by the mandatory liquidation date (May 31, 2025, or September 30, 2025, if fully extended)[160] The Company will need to raise additional capital through loans or investments from its Sponsor, stockholders, officers, directors, or third parties to meet working capital needs[159] Off-Balance Sheet Arrangements This section discloses any material off-balance sheet arrangements that could impact the company's financial condition The Company had no off-balance sheet arrangements as of March 31, 2025[161] Contractual Obligations This section details the company's significant contractual commitments, including promissory notes, registration rights, and deferred fees The Company has a non-interest bearing unsecured promissory note with the Sponsor, amended to a maximum of $3,530,000, with $2,923,445 outstanding as of March 31, 2025, and a maturity date of May 31, 2025, with potential extension and monthly payments post-business combination[162][163] The Company is obligated under a registration rights agreement to register certain securities (Founder Shares, Placement Units, Working Capital Loan conversion units) for resale, bearing the associated expenses[164][165] The Company owes $2,070,000 in deferred underwriting commissions, payable from the Trust Account upon completion of an initial business combination[167] The Company is committed to paying LifeSci Capital LLC 1.5% of the total consideration of the initial business combination in equity interests and reimbursing out-of-pocket expenses[168][171] The Company has an agreement with Continental Stock Transfer & Trust Company to manage the Trust Account, investing funds in U.S. government securities or money market funds, and paying trustee fees, with the agreement amended to allow extensions of the business combination deadline and remove dissolution expense withdrawal[172][173] Critical Accounting Estimates This section identifies and explains accounting estimates that require significant judgment and could materially affect financial results Management reviews accounting policies, assumptions, estimates, and judgments, and as of March 31, 2025, no critical accounting estimates were identified[174] Recent Accounting Standards This section discusses the adoption and potential impact of new accounting pronouncements on the company's financial statements ASU 2023-09 (Income Taxes) is effective for fiscal years after December 15, 2024, with the Company evaluating its impact, while ASU 2023-07 (Segment Reporting) was adopted January 1, 2024, with no material effect[175][176] Management does not believe other recently issued, but not yet effective, accounting standards would have a material effect[177] JOBS Act This section explains the company's status as an emerging growth company and its election to utilize certain JOBS Act provisions The Company qualifies as an "emerging growth company" under the JOBS Act, allowing it to delay adoption of new accounting pronouncements to private company effective dates, which may affect comparability[178] The Company is evaluating other reduced reporting requirements under the JOBS Act, such as exemptions from auditor attestation reports on internal controls and certain executive compensation disclosures[179] Item 3. Quantitative and Qualitative Disclosures Regarding Market Risk This item is not required for smaller reporting companies, and thus no disclosures are provided This disclosure is not required for smaller reporting companies[180] Item 4. Controls and Procedures Management, including the principal executive and financial officers, evaluated the effectiveness of the Company's disclosure controls and procedures as of March 31, 2025, concluding they were effective at a reasonable assurance level, with no material changes in internal control over financial reporting during the quarter As of March 31, 2025, management concluded that the Company's disclosure controls and procedures were effective at a reasonable assurance level[182] There were no changes in internal control over financial reporting during the most recent fiscal quarter that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[183] Part II. Other Information This section covers legal proceedings, risk factors, equity sales, defaults, mine safety, other disclosures, and exhibits Item 1. Legal Proceedings The Company reported no legal proceedings No legal proceedings were reported[186] Item 1A. Risk Factors The Company refers to the risk factors described in its final prospectus for its Initial Public Offering, stating there have been no material changes to these factors as of the report date No material changes to risk factors disclosed in the final prospectus for the Initial Public Offering[186] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The Company refers to Part I, Item 2 of this Quarterly Report for a description of the use of proceeds from its Initial Public Offering and private placement, noting no material change in the planned use No material change in the planned use of proceeds from the Initial Public Offering and private placement[187] Item 3. Defaults Upon Senior Securities The Company reported no defaults upon senior securities No defaults upon senior securities were reported[188] Item 4. Mine Safety Disclosures The Company reported no mine safety disclosures No mine safety disclosures were reported[188] Item 5. Other Information The Company reported no other information No other information was reported[188] Item 6. Exhibits This section lists the exhibits filed as part of, or incorporated by reference into, the Form 10-Q, including certifications from the Principal Executive Officer and Principal Financial Officer, and Inline XBRL documents Exhibits filed include certifications (31.1, 31.2, 32.1, 32.2) and Inline XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[190] Part III. Signatures This section contains the signatures of the registrant's authorized officers, including the Chief Executive Officer and Chief Financial Officer, certifying the report The report is signed by Arie Rabinowitz, Chief Executive Officer, and Scott Burell, Chief Financial Officer, on May 14, 2025[194]