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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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For the quarterly period ended September 30, 2021March 31, 2023

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For the transition period from _________ to _________

Commission File Number: 001-40945

PEGASUS DIGITAL MOBILITY ACQUISITION CORP.

(Exact name of registrant as specified in its charter)

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+1 (345) 769-4900

(Registrant’s telephone number, including area codecode)

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Not Applicable

(Former name, or former address and former fiscal year, if changed since last report)

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Securities registered pursuant to Section 12(b) of the Act:

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐☒ No ☒☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☒ No ☐

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As of November 30, 2021,May 19, 2023, the Registrantregistrant had 22,500,000 Class A ordinary shares, $0.0001 par value $0.0001 per share, and 5,750,0005,625,000 Class B ordinary shares, $0.0001 par value $0.0001 per share, issued and outstanding.

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PEGASUS DIGITAL MOBILITY ACQUISITION CORP.

FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2021MARCH 31, 2023

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

PEGASUS DIGITAL MOBILITY ACQUISITION CORP.

UNAUDITED CONDENSED BALANCE SHEETSHEETS

(UNAUDITED)

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The accompanying notes are an integral part of these unaudited condensed financial statements.

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PEGASUS DIGITAL MOBILITY ACQUISITION CORP.

UNAUDITED CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

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The accompanying notes are an integral part of these unaudited condensed financial statements.

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PEGASUS DIGITAL MOBILITY ACQUISITION CORP.

UNAUDITED CONDENSED STATEMENTS OF CHANGES IN ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION AND
SHAREHOLDERS’ EQUITYDEFICIT

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FOR THE THREE MONTHS ENDED MARCH 31, 2023

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FOR THE THREE MONTHS ENDED MARCH 31, 2022

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The accompanying notes are an integral part of these unaudited condensed financial statements.

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PEGASUS DIGITAL MOBILITY ACQUISITION CORP.

UNAUDITED CONDENSED STATEMENTSTATEMENTS OF CASH FLOWS

(UNAUDITED)

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The accompanying notes are an integral part of these unaudited condensed financial statements.

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PEGASUS DIGITAL MOBILITY ACQUISITION CORP.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

Note 1 - Description of Organization and Business Operations

Organization and General

Pegasus Digital Mobility Acquisition Corp. (the “Company”) is a blank check company incorporated in the Cayman Islands on March 30, 2021. The Company was incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with 1one or more businesses or assets (the “Business Combination”). The Company has not selected any Business Combination target and the Company has not, nor has anyone on its behalf, engaged in any substantive discussions, directly or indirectly, with any potential Business Combination target.

As of September 30, 2021,March 31, 2023, the Company had not commenced any operations. All activity for the period fromthrough March 30, 2021 (inception) through September 30, 202131, 2023 relates to the Company’s formation and the initial public offering (the “IPO”)., and, since the completion of the IPO, a search for a Business Combination. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income and dividends on cash, and cash equivalents, and marketable securities from the proceeds derived from the IPO. The Company has selected December 31 as its fiscal year end.

The Company’s sponsor is Pegasus Digital Mobility Sponsor LLC, a Cayman Islands limited liability company (the “Sponsor”).

Financing

The registration statement on Form S-1 for the Company’s IPO was declared effective on October 21, 2021. On October 26, 2021, the Company consummated the IPO of 20,000,000 units at $10.00 per unit (the “Units”), generating gross proceeds to the Company of $200,000,000. Each Unit consists of 1one Class A ordinary share, par value $0.0001 per share (the “Class A ordinary shares”), and one-half of 1one redeemable warrant (the(each whole warrant, a “Public Warrants”Warrant”). Each whole Public Warrant entitles the holder to purchase 1one Class A ordinary share at an exercise price of $11.50 per whole share, subject to adjustment. The Company granted the underwriters a 45-day45-day option from the date of the underwriting agreement to purchase up to an additional 3,000,000 Units to cover any over-allotments. On November 8, 2021, the underwriters partially exercised the over-allotment option to purchase 2,500,000 Units (the “Over-allotment Units”), generating aggregate gross proceeds of $25,000,000, and the Company incurred $500,000 in cash underwriting fees and $875,000 in deferred underwriting fees.over-allotments, if any.

Simultaneously with the consummation of the IPO, the Company consummated the sale of 9,000,000 warrants (the “Private Placement Warrants”), each exercisable to purchase 1one Class A ordinary share at $11.50 per share, at a price of $1.00 per Private Placement Warrant in a private placement to the Sponsor, generating gross proceeds to the Company of $9,000,000. The Sponsor agreed to purchase up to an additional 900,000 Private Placement Warrants dependingDepending on the extent to which the underwriters’ over-allotment option is exercised.was exercised, the Sponsor agreed to purchase an additional 900,000 Private Placement Warrants.

The Company’s anchor investors are certain institutional investors (the “Anchor Investors”). UponOn November 4, 2021, the closingunderwriters partially exercised the over-allotment option and, on November 8, 2021, purchased 2,500,000 Units, generating aggregate gross proceeds of the IPO, the Anchor Investors purchased 1,375,000 Class B ordinary shares, par value $0.0001 (the “Class B Ordinary Shares”, and with respect to the Anchor Investors, the “Anchor Shares”) from the Sponsor.

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Transaction costs related to the IPO closing amounted to $11,664,654, consisting of $4,000,000 of underwriting commissions, $7,000,000 of deferred underwriting commissions, and $664,654 of other offering costs.

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$25,000,000. On November 8, 2021, simultaneously with the sale of the Over-allotmentover-allotment Units, the Company consummated the private sale of an additional 750,000 Private Placement Warrants, (the “Additional Private Placement Warrants”), generating gross proceeds to the Company of $750,000.

​Transaction costs related to the consummation of the IPO on October 26, 2021 amounted to $13,124,654 consisting of $4,500,000 of underwriting discounts, $7,875,000 of deferred underwriting commissions, and $749,654 of other offering costs.

Prior to the IPO, qualified institutional buyers or institutional accredited investors (the “Anchor Investors”) expressed to the Company an interest in purchasing Units in the IPO in exchange for the Sponsor agreeing to sell the Anchor Investors Class B ordinary shares, par value $0.0001 (“Founder Shares”). Upon the closing of the IPO, the Anchor Investors received 1,375,000 Founder Shares (“Anchor Shares”) from the Sponsor. The fair value of the Anchor Shares was treated as an issuance cost of the offering which was allocated to the Class A ordinary shares and Public Warrants.

On November 4, 2021, the Sponsor transferred an aggregate of 843,750 Founder Shares to the Company’s officers and independent directors. On December 6, 2021, 125,000 of the Founder Shares were forfeited by the Sponsor as a result of the underwriters’ partial exercise of the over-allotment option and the expiration of the over-allotment option. All shares and per-share amounts have been retroactively restated to reflect the forfeiture of the 125,000 Founder Shares.

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As further discussed in Note 8 Subsequent Events, in April 2023, shareholders holding 15,300,927 shares of Class A ordinary shares exercised their right to redeem their shares for a pro rata portion of the funds in the Trust Account. As a result, $160,337,374 was withdrawn from the Trust and paid to such shareholders. Approximately $75,438,597 remains in the Company's Trust Account. Following the redemption, 7,199,073 of the Company's Class A ordinary shares remained outstanding.

Trust Account

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Following the closing of the IPO on October 26, 2021, and the underwriters’ partial exercise of the over-allotment option on November 8, 2021, $227,250,000 ($10.10 per Unit) fromof the net proceeds from the sale of the Units in the IPO and a portion of the net proceeds from the sale of the Private Placement Warrants were deposited into a trust account (the “Trust Account”) and were, and will be, invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 of the Investment Company Act of 1940, as amended (the “Investment Company Act”), that invest only in direct U.S. government treasury obligations. Except with respect to interest earned on the funds held in the Trust Account that may be released to the Company to pay its taxes, if any, the funds held in the Trust Account will not be released to the Company from the Trust Account until the earliest to occur of: (a) the completion of its initial Business Combination, (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend itsthe Company’s amended and restated memorandum and articles of association (the “A&R Articles”) (i) to modify the substance or timing of its obligation to redeem 100% of its public shares if the Company does not complete its initial Business Combination within 15 months from the closing of the IPO, which is extendable at the Sponsor’s option up to 21 months as described below (the “Combination Period”) or (ii) with respect to any other provisions relating to shareholders’ rights or pre-initial Business Combination activity; and (c) the redemption of its public shares if the Company is unable to complete its Business Combination within the Combination Period, subject to applicable law.

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Initial Business Combination

​The initial Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the Trust Account (net of amounts disbursed to management for working capital purposes, if permitted, and excluding the amount of any deferred underwriting commissions held in the Trust Account). However, the Company will only complete such Business Combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance that the Company will be able to complete a Business Combination successfully.

On January 23, 2023, the Company issued a non-convertible unsecured promissory note (the "Extension Note") in the principal amount of $2,250,000 to the Sponsor (see Note 4). The Sponsor deposited the funds into the Trust Account. The Extension Note was issued in connection with the decision by the Company's board of directors to exercise the first extension option in accordance with the Company's amended and restated memorandum and articles of association and to extend the date by which the Company must consummate a business combination transaction from January 26, 2023 to April 26, 2023 (i.e., for a period of time ending 18 months after the consummation of the IPO). The Extension Note bears no interest and is repayable in full upon the consummation of a business combination by the Company. If the Company does not consummate a Business Combination, the Extension Note will not be repaid and all amounts owed under the Extension Note will be forgiven except to the extent that the Company has funds available to it outside of its Trust Account. On March 15, 2023, the Company amended and restated certain provisions of the Extension Note to align the terms of the Extension Note with the March 2023 Promissory Note (as defined below).

On April 24, 2023, the Company issued a non-convertible unsecured promissory note (the “April 2023 Extension Note”) in the principal amount of $719,907 to the Sponsor (see Note 8). The Sponsor deposited the funds into the Trust Account. The April 2023 Extension Note was issued in connection with the exercise of the Company’s second extension option under the second amended and restated articles of association (see Note 8) to extend the date by which the Company must consummate a business combination transaction from April 26, 2023 to July 26, 2023 (i.e., for a period of time ending 21 months after the consummation of the IPO). The April 2023 Extension Note bears no interest and is repayable in full upon the consummation of a business combination by the Company. If the Company does not consummate a Business Combination, the April 2023 Extension Note will not be repaid and all amounts owed under the April 2023 Extension Note will be forgiven except to the extent that the Company has funds available to it outside of its Trust Account.

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With the exercise of the first and second extensions mentioned above, the Company will have until 1521 months from the closing of the IPO, or July 26, 2023, to consummate the initial Business Combination. If the Company anticipates that it may not be able to consummate the initial Business Combination within 1521 months, the Company may, by resolution of its board of directors (the “Board”) and at the option of the Sponsor, extend the period of time the Company will have to consummate an initial Business Combination up to two times, eachone more time by an additional three months, (for a total of up to an additional six months from the closing of the IPO), subject to the Sponsor contributing $0.10 per then-issued and outstanding Unitunit to the Trust Account.Account (as defined below). The Company’s shareholders will not be entitled to vote on, or redeem their shares in connection with, any such extension. Pursuant to the terms of the A&R Articles,second amended and restated memorandum and articles of association, in order to extend the period of time to consummate an initial Business Combination in such a manner, the Sponsor must deposit $2,000,000 (or up to $2,300,000 depending on the extent to which underwriters’ over-allotment option is exercised)$2,250,000 into the Trust Account on or prior to the date of the applicable deadline, for eachsuch three-month extension. The Sponsor has the option to accelerate its deposit of one or both halves of the up to $4,000,000 (or up to $4,600,000 depending on the extent to which the underwriters’ over-allotment option is exercised) at any time following the closing of the IPO and prior to the consummation of the initial Business Combination with the same effect of extending the time the Company will have to consummate an initial Business Combination by three or six months, as applicable.

​months. See Note 8 - Subsequent Events.

The Company will provide its public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of the initial Business Combination either (1) in connection with a general meeting called to approve the Business Combination or (2) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a proposed Business Combination or conduct a tender offer will be made by the Company, solely in its sole discretion. The Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if the Company seeks shareholder approval, a majority of the issued and outstanding shares voted are voted in favor of the Business Combination. The Company will also provide its public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of its initial Business Combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated as of two business days prior to the completion of its initial Business Combination, including interest (which interest shall be net of taxes payable), divided by the number of then-issued and outstanding Class A ordinary shares that were sold as part of the Units in the IPO, which the Company refers to collectively as its public shares, subject to the limitations described herein. If the Company has not completed its initial Business Combination within the Combination Period, the Company will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (less up to $100,000 inof interest to pay dissolution expenses and which interest shall be net of taxes payable), divided by the number of then-issued and outstanding public shares, subject to applicable law and as further described herein.

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The ordinary shares subject to redemption were recorded at a redemption value and classified as temporary equity upon the completion of the IPO, in accordance with Financial Accounting Standards Board’s (the “FASB”(“FASB”) Accounting Standards Codification (the “ASC”(“ASC”) Topic 480, “Distinguishing Liabilities from Equity”, and subsequently accreted to redemption value. In such case, the Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if the Company seeks shareholder approval, a majority of the issued and outstanding shares voted are voted in favor of the Business Combination.

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The initial shareholders, directors, officers and advisors have agreed to waive: (i) their redemption rights with respect to any Class B ordinary sharesFounder Shares and public shares held by them, as applicable, in connection with the completion of the Company’s initial Business Combination; (ii) their redemption rights with respect to any Class B ordinary sharesFounder Shares and public shares held by them in connection with a shareholder vote to amend the A&R ArticlesCompany’s amended and restated memorandum and articles of association (A) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the initial Business Combination or to redeem 100% of the public shares if the Company does not complete the initial Business Combination within the Combination Period or (B) with respect to any other provision relating the rights of holders of the Class A ordinary shares; and (iii) their rights to liquidating distributions from the Trust Account with respect to any Class B ordinary sharesFounder Shares they hold if the Company fails to complete its initial Business Combination within the Combination Period or during any extended time that the Company has to consummate a Business Combination beyond the Combination Period as a result of a shareholder vote to amend the Company’s A&R Articlesamended and restated memorandum and articles of association (an “Extension Period”) (although they will be entitled to liquidating distributions from the Trust Account with respect to any public shares they hold if the Company fails to complete the initial Business Combination within the prescribed time frame); and (iv) vote their Class B ordinary sharesFounder Shares and any public shares purchased during or after the IPO in favor of the Company’s initial Business Combination. Each of the Anchor Investors has entered into an investment agreement with the Company pursuant to which they have agreed that any Class B ordinary sharesFounder Shares held by them are (i) not entitled to redemption rights in connection with the completion of the Company’s initial Business Combination or in connection with a shareholder vote to amend the A&R ArticlesCompany’s amended and restated memorandum and articles of association and (ii) not entitled to liquidating distributions from the Trust Account with respect to any Class B ordinary sharesFounder Shares the Anchor Investor holds in the event the Company fails to complete its initial Business Combination within the Combination Period or during any Extension Period.

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The Sponsor has agreed that it will be liable to the Company if and to the extent any claims by a third party (other than the Company’s independent auditors) for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (1) $10.10 per public share or (2) such lesser amount per public share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company has not independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations and believesbelieve that the Sponsor’s only assets are securities of the Company and, therefore, that the Sponsor may not be able to satisfy those obligations. The Company has not asked the Sponsor to reserve for such obligations.

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Liquidity and Capital ResourcesGoing Concern

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As of September 30, 2021,March 31, 2023, the Company had 0$1,341,543 of cash and a working capital deficit of $530,002 (excluding any tax obligations$5,035,521.

The Company has incurred and deferred offering costs).

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On October 26, 2021, the Company consummated the IPO of 20,000,000 Units at a price of $10.00 per Unit, generating gross proceeds of $200,000,000. Simultaneously with the closing of the IPO, the Company consummated the sale of 9,000,000 Private Placement Warrantsexpects to the Sponsor at a price of $1.00 per Private Placement Warrant, generating gross proceeds of $9,000,000.

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On November 8, 2021, the underwriters partially exercised their optioncontinue to purchase 2,500,000 additional Units for the total amount of $25,000,000. As a result of the partial over-allotment exercise, the Company also issued 750,000 Private Placement Warrants, generating an additional $750,000 gross proceeds.

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Following the IPO, the sale of the Private Placement Warrants and the partial exercise of the over-allotment option, a total of $227,250,000 was placed in the Trust Account, and the Company had $2,753,243 of cash held outside of the Trust Account, after payment of costs related to the IPO, and available for working capital purposes.

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In order to fund working capital deficiencies or finance transactionincur significant costs in connection withpursuit of its financing and acquisition plans. The Company lacks the financial resources it needs to sustain operations for a Business Combination, the Sponsor or an affiliatereasonable period of the Sponsor or certain of the Company’s officers and directors may, but are not obligatedtime, which is considered to loan the Company funds as may be required. If the Company completes a Business Combination, the Company may repay such loaned amounts out of the proceeds of the Trust Account released to it. In the event that a Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay such loaned amounts, but no proceeds from the Trust Account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into Private Placement Warrants of the post-Business Combination entity at a price of $11.50 per Private Placement Warrant at the option of the lender. As of September 30, 2021, the Company did not have any outstanding working capital loans.

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The ongoing conflict in Ukraine—along with the responses of the governments of the United States, European Union (“EU”)member states, the United Kingdom, and other nations—have the potential to materially adversely affect a potential target business’s operations or assets in—or (direct or indirect) dealings with parties organized or located within—Ukraine, Russia, and Belarus. Due to recent geopolitical developments, the United States, European Union, United Kingdom, and other nations have announced or threatened new sanctions and export restrictions targeting Russian and Belarusian individuals and entities, as well as disputed territories within Ukraine. Russia and its allies may respond with countermeasures, which could further restrict the target business’s operations in or related to the foregoing countries. It is unclear how long existing restrictions (and countermeasures) will remain in place or whether new restrictions (or countermeasures) may be imposed. Existing restrictions have negatively impacted the Russian economy, and there can be no guarantee that existing (or new) restrictions or countermeasures will not materially adversely affect the Russian (or global) economy. Any of the foregoing could have a material adverse impact on a potential target business’s financial condition, results of operations, or prospects.

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Note 2 - Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, theythe financial statements do not include all of the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair statement of the financial position, operating results and cash flows for the periods presented.

The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, which contains the audited financial statements and notes thereto. The financial information as of December 31, 2022 is derived from the audited financial statements presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The interim results for the three-month periodthree months ended September 30, 2021, and the period from March 30, 2021 (inception) through September 30, 2021,31, 2023 are not necessarily indicative of the results that mayto be expected for the year ending December 31, 20212023 or for any future interim periods.

Emerging Growth Company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such, the Company is eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statement, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find the Company’s securities less attractive as a result, there may be a less active trading market for its securities and the prices of its securities may be more volatile.

In addition, Section 107 of the JOBS Act also which provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company intends to take advantage of the benefits of this extended transition period.

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Use of Estimates

The preparation of the unaudited condensed financial statementstatements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet. Actualcondensed financial statements and the reported amounts of expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the condensed financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

Cash and Cash Equivalents

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. As of March 31, 2023 and December 31, 2022, the Company had no cash equivalents.

Investments held in Trust Account

Trading securities in the Trust Account were invested in U.S. Treasury Securities and marketable securities which are reported at fair value. The Company’s portfolio of investments held in the Trust Account is comprised of U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, investments in money market funds that invest in U.S. government securities, cash, or a combination thereof. Gains and losses resulting from the change in fair value of these securities are recorded to net income each period. The estimated fair values of the investments held in the Trust Account are determined using quoted market prices in active markets.

Share Based Compensation

The Company did 0taccounts for the transfer of Founder Shares to the Company’s officers and independent directors in accordance with ASC Topic 718, “Compensation-Stock Compensation”. The awards have anya performance condition that requires the consummation of an initial business combination to fully vest. As the performance condition is not probable and will likely not become probable until the consummation of an initial business combination, the Company will defer recognition of the compensation costs until the consummation of an initial business combination.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash equivalentsaccounts in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage. The Company has not experienced losses on these accounts.

Class A Ordinary Shares Subject to Possible Redemption

The Company accounts for its ordinary shares subject to possible redemption in accordance with the guidance enumerated in ASC Topic 480. Ordinary shares subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity (deficit). The Company’s Class A ordinary shares contain certain redemption rights that are considered by the Company to be outside of the Company’s control and subject to the occurrence of uncertain future events. Accordingly, as of September 30, 2021.March 31, 2023 and December 31, 2022, 22,500,000 Class A ordinary shares subject to possible redemption are presented as temporary equity, at redemption value, outside of the shareholders’ deficit section of the Company’s balance sheets.

The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable Class A ordinary shares to equal the redemption value at the end of each reporting period. Such changes are reflected in additional paid-in capital, or in the absence of additional paid-in capital, in accumulated deficit. During the three months ended March 31, 2023 and 2022, the Company recorded accretion of $4,717,871 and $41,520, respectively, which were recorded within accumulated deficit.

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Deferred Offering Costs associated with the Initial Public Offering

Deferred offeringOffering costs consist principally of legal, accounting, underwritingprofessional and registration fees and other costs incurred through the balance sheet date that are directly related to the IPO and that will be charged to shareholders’ equity uponIPO. Upon the completion of the IPO.

Net Loss Per Ordinary Share

The Company complies with accounting and disclosure requirements of ASC Topic 260, “Earnings Per Share.” Net loss per share is computed by dividing net loss byIPO, the weighted average number of ordinary shares outstanding duringoffering costs were allocated between the period, excluding ordinary shares subject to forfeiture by the Sponsor. Weighted average shares were reduced for the effect of an aggregate of 750,000Company's Class B ordinary shares that are subject to forfeiture if the over-allotment option is not exercised by the underwriters. As of September 30, 2021, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted intoA ordinary shares and then sharethe public warrants. The costs allocated to the public warrants amounting to $520,432 were recognized in other expenses and those related to the earningsCompany's Class A ordinary shares amounting to $12,604,222 were charged against the carrying value of the Company. As a result, diluted loss per share is the same as basic loss per share for the period presented.Class A ordinary shares.

Fair Value Measurements

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the balance sheet,sheets, primarily due to itstheir short-term nature.Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. US GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The Company’s financial instruments are classified as either Level 1, Level 2 or Level 3. These tiers include:nature.

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Net Income (Loss) per Ordinary Share

The statements of operations include a presentation of income (loss) per Class A redeemable ordinary share and income (loss) per Class B non-redeemable ordinary share following the two-class method of income (loss) per share. In order to determine the net income (loss) attributable to both the Class A redeemable ordinary shares and founder non-redeemable ordinary shares, the Company first considered the total income (loss) allocable to both sets of shares. This is calculated using the total net income (loss) less any dividends paid. For purposes of calculating net income (loss) per share, any remeasurement of the accretion to redemption value of the Class A redeemable ordinary shares subject to possible redemption was considered to be dividends paid to the public shareholders. Subsequent to calculating the total income (loss) allocable to both sets of shares, the Company split the amount to be allocated using a ratio of 80% for the Class A redeemable ordinary shares and 20% for the Class B non-redeemable ordinary shares for the three months ended March 31, 2023, reflective of the respective participation rights.

The earnings per share presented in the statements of operations for the three months ended March 31, 2023 is based on the following:

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The earnings per share presented in the statements of operations for the three months ended March 31, 2022 is based on the following:

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Recent Accounting Pronouncements

In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06, “Debt-Debt“Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40)” (“ASU 2020-06”), to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity'sentity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 20222024 for smaller reporting companies as defined in Item 10(f)(1) of Regulation S-K, and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on inception date. The Company is currently assessing the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows.

Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements.

Note 3 - Initial Public OfferingDerivative Financial instruments

Warrants

On October 26, 2021, the Company sold 20,000,000 Units, at a price of $10.00 per Unit, generating gross proceeds of $200,000,000. Each Unit consists of 1 Class A ordinary shareMarch 31, 2023 and one-half of 1December 31, 2022, 21,000,000 warrants were outstanding (11,250,000 Public Warrant.Warrants and 9,750,000 Private Placement Warrants). Each whole Public Warrantwarrant entitles the holder to purchase 1 share of Class A ordinary shares at an exercise price of $11.50 per whole share, subject to adjustment.

On November 8, 2021, the underwriters partially exercised the over-allotment option and purchased 2,500,000 Units for an aggregate amount of $25,000,000.

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qualify the shares under applicable blue sky laws to the extent an exemption is not available. In the case of a cashless exercise, each holder would pay the exercise price by surrendering the Public Warrantswarrants for that number of Class A ordinary shares equal to the lesser of (A) the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the Public Warrants,warrants, multiplied by the excess of the “fair market value” (defined below) less the exercise price of the warrants by (y) the fair market value and (B) 0.361 Class A ordinary shares per warrant. The “fair market value” as used in the preceding sentence shall mean the volume weighted average price of the Class A ordinary shares for the 10 trading days ending on the trading day prior to the date on which the notice of exercise is received by the warrant agent.

Redemption of Public Warrantswarrants when the price per Class A ordinary share equals or exceeds $18.00. Once the Public Warrantswarrants become exercisable, the Company may redeem the outstanding Public Warrants:warrants (except as described herein with respect to the Private Placement Warrants):

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The Company accounts for the Public Warrants and Private Placement Warrants as liabilities in accordance with the guidance contained in ASC Topic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity.” Because the Company does not control the occurrence of events, such as a tender offer or exchange, that may trigger cash settlement of the warrants where not all of the shareholders also receive cash, the warrants do not meet the criteria for equity treatment thereunder, as such, the warrants must be recorded as a derivative liability.

Additionally, certain adjustments to the settlement amount of the Private Placement Warrants are identicalbased on a variable that is not an input to the Public Warrants described above in Note 3, except that, so longfair value of a “fixed-for-fixed” option as they are held by the Sponsor or its permitted transferees: (1) they will not be redeemable by the Company (except in certain redemption scenarios when the price per Class A ordinary share equals or exceeds $10.00 (as adjusted)); (2) they (including the Class A ordinary shares issuable upon exercise of Private Placement Warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by the Sponsor until 30 days after the completion of the Company’s initial Business Combination; (3) they may be exercised by the holders on a cashless basis;defined under ASC Topic 815-40, and (4) they (including the Class A ordinary shares issuable upon exercise ofthus the Private Placement Warrants)Warrants are entitlednot considered indexed to registration rights.the Company’s own stock and not eligible for an exception from derivative accounting.

Note 54 - Related Party Transactions

Class B ordinary shares

On April 16, 2021, the Sponsor paid $25,000 in consideration for 5,750,000 Class B ordinary shares. Of the 5,750,000 Class B ordinary shares, as of September 30, 2021, up to 750,000 Class B ordinary shares were subject to forfeiture by the Sponsor depending on the extent to which the underwriters’ over-allotment option was exercised. On November 8, 2021, the underwriters partially exercised the over-allotment option and, as a result of such partial exercise, 625,000 Class B ordinary shares are no longer subject to forfeiture.

Upon the closing of the IPO, the Anchor Investors purchased 1,375,000 Anchor Shares from the Sponsor.

The Sponsor and its permitted transferees and the Anchor Investors (collectively, the “initial shareholders”) have agreed not to transfer, assign or sell any of their Class B ordinary shares until the earlier to occur of: (A) one year after the completion of the initial Business Combination; and (B) subsequent to the initial Business Combination (x) if the last reported sale price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share dividends, rights issuances, consolidations, reorganizations, recapitalizations and other similar transactions) for any 20 trading days within any 30-trading day period commencing at least 150 days after the initial Business Combination or (y) the date on which the Company completes a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of the public shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. Any permitted transferees would be subject to the same restrictions and other agreements of the initial shareholders with respect to any Class B ordinary shares.

Promissory Note

On April 16, 2021, the Sponsor agreed to loan the Company up to $300,000 under an unsecured promissory note (the “note”) to be used for a portion of the expenses of the IPO. As of September 30, 2021, the Company had borrowed $153,860 under the $300,000 promissory note with the Sponsor. The note is non-interest bearing, unsecured and is due at the earlier of April 30, 2022 and the closing of the IPO. The note was repaid in full upon completion of the IPO.

Working Capital Loans

In order to fund working capital deficiencies or finance transaction costs in connection with an intended initial Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s directors and officers may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes the initial Business Combination, the Company may repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans may be repaid only out of funds held outside the Trust Account. In the event that the initial Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay the Working Capital Loans but no proceeds from the Company’s Trust Account would be used to repay the Working Capital Loans. Up to $1,500,000 of the Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the Private Placement Warrants issued to the Sponsor. The terms of the Working Capital Loans, if any, have not been determined and no written agreements exist with respect to the Working Capital Loans. The Company does not expect to seek loans from parties other than the Sponsor or an affiliate of the Sponsor or certain of the Company’s directors and officers as the Company does not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in the Company’s Trust Account. As of September 30, 2021,March 31, 2023 and December 31, 2022, the Company had 0 borrowings underno Working Capital Loans.

Administrative Services Agreement

On October 26, 2021, theThe Company entered into an Administrative Services Agreement pursuant to which it will pay an affiliate of the Sponsor a total of $14,000 per month for office space and administrative and support services. The agreement was effective upon the date that securities of the Company were first listed on the New York Stock Exchange, October 22, 2021. Upon completion of the initial Business Combination or itsthe Company’s liquidation, the Company will cease paying these monthly fees. For the three months ended March 31, 2023 and for the year ended December 31, 2022, the Company incurred and accrued $42,000 and $168,000, respectively, under the Administrative Services Agreement as due to related party on the balance sheets and as administrative expenses - related party in the statements of operations.

Payables to Related Parties

The due to related party balance consists of administrative fees incurred, but not yet paid, through March 31, 2023 and December 31, 2022 and payable to the Sponsor for amounts paid on the Company’s behalf. As of March 31, 2023 and December 31, 2022, the Company had a due to related party payable of $242,139 and $200,530, respectively.

Promissory Notes – Related Party

On January 23, 2023, the Company issued the Extension Note in the principal amount of $2,250,000 to the Sponsor.

On March 15, 2023, the Company issued a non-convertible unsecured promissory note in the principal amount of $1,100,000 to the Sponsor (the “March 2023 Promissory Note” and together with the Extension Note, the “Promissory Notes”).

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The Promissory Notes are non-interest bearing and due on the earlier of (i) December 31, 2023, (ii) the date the Company consummates an initial Business Combination, or (iii) within three days of the receipt of any funds received from a break-fee, termination fee or similar arrangement with a target company related to a potential Business Combination. If a Business Combination is not consummated, amounts outstanding under the Promissory Notes will not be repaid and all amounts owed will be forgiven, except to the extent that cash is available outside of the Trust Account to satisfy the obligation. As of March 31, 2023, an aggregate of $3,350,000, the aggregate amount available under the Promissory Notes, was outstanding.

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Note 65 - Commitments and Contingencies

Registration Rights

The holders of the Class B ordinary shares,Founder Shares, Private Placement Warrants and any warrants that may be issued on conversion of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the Working Capital Loans and upon conversion of the Class B ordinary shares) areFounder Shares) will be entitled to registration rights pursuant to a registration rights agreement signed in connection with the IPO requiring the Company to register such securities for resale (in the case of the Class B ordinary shares,Founder Shares, only after conversion to the Class A ordinary shares). The holders of these securities will be entitled to make up to 3three demands, excluding short form registration demands, that the Company registers such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the Company’s completion of the initial Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. However, the registration rights agreement provides that the Company will not be required to effect or permit any registration or cause any registration statement to become effective until termination of the applicable lock-up period. The Company will bear the expenses incurred in connection with the filing of any such registration statements.statement.

Underwriting Agreement

On October 26, 2021, the Company paid a cash underwriting commission of 2.0% per Unit, or $4,000,000. Additionally, the underwriters are entitled to a deferred underwriting commission of 3.5%, or $7,000,000 of the gross proceeds, of the IPO upon the completion of the Company’s initial Business Combination.

The Company granted the underwriters a 45-day option from October 21, 2021,the date of the IPO to purchase up to an additional 3,000,000 Units to cover over-allotments, if any. On November 8, 2021, the underwriters partially exercised their over-allotment option and purchased an additional 2,500,000 Units.

On November 8,October 26, 2021, upon the underwriters’ partial exercise of the over-allotment option, the Company paid a cash underwriting commissiondiscount of 2.0% per Unit, or $500,000.$4,000,000. Additionally, the underwriters arewill be entitled to a deferred underwriting commission of 3.5%, or $875,000 of the gross proceeds of the IPO totaling $7,000,000 upon the completion of the Company’s initial Business Combination.

Legal Proceedings

There is no material litigation, arbitration or governmental proceeding currently pending againstOn November 4, 2021, the Company or any membersunderwriters partially exercised the over-allotment option and, on November 8, 2021, purchased 2,500,000 Units, generating aggregate gross proceeds of its management team in their capacity as such,$25,000,000, and the Company incurred $500,000 in cash underwriting discounts and the members of its management team have not been subject to any such proceeding$875,000 in the 12 months preceding the date of this Quarterly Report on Form 10-Q.deferred underwriting commissions.

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On December 6, 2021, 125,000 of the Class B ordinary shares were allocatedforfeited by the Sponsor as follows: 4,375,000a result of the underwriters’ partial exercise of the over-allotment option and the expiration of the over-allotment option.

As of March 31, 2023 and December 31, 2022, there were 5,625,000 Class B ordinary shares issued and outstanding.

The sales or transfers of the Class B ordinary shares and Private Placement Warrants to the SponsorCompany’s officers and 1,375,000independent directors, as described above, is within the scope of ASC Topic 718, “Compensation-Stock Compensation.” Under ASC 718, share-based compensation associated with equity classified awards is measured at fair value upon the grant date. The Private Placement Warrants, which were recorded as a derivative liability, have been settled on the grant date, November 4, 2021. The settlement of the $711,750 derivative liability was recorded in accumulated deficit in the accompanying balance sheet as of December 31, 2021.

The Class B ordinary shares and Private Placement Warrants were effectively sold or transferred subject to a performance condition (i.e., the occurrence of a Business Combination). Compensation expense related to those is recognized only when the performance condition is probable of occurrence under the applicable accounting literature. Stock-based compensation would be recognized at the date a Business Combination is considered probable in an amount equal to the Anchor Investors.number of Class B ordinary shares granted times the grant date fair value per share (unless subsequently modified) less the amount initially received for the purchase of those shares. As of March 31, 2023, the Company determined that a Business Combination is not probable and therefore, no stock-based compensation expense has been recognized. The unrecognized stock-based compensation expense as of March 31, 2023 was $6,719,250.

The Class A ordinary shareholders and Class B ordinary shareholders of record are entitled to 1one vote for each ordinary share held on all matters to be voted on by shareholders and vote together as a single class, except as required by law; provided, that, prior to the initial Business Combination, holders of the Class B ordinary shares will have the right to appoint all of the Company’s directors and remove members of the Boarddirectors for any reason, and holders of the Class A ordinary shares will not be entitled to vote on the appointment of directors during such time.

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Note 7 – Fair Value of Financial Instruments

The Company follows the guidance in ASC Topic 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liability in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

In many cases, a valuation technique used to measure fair value includes inputs from multiple levels of the fair value hierarchy described above. The lowest level of significant input determines the placement of the entire fair value measurement in the hierarchy.

The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

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Transfers between Levels 1, 2 and 3 are recognized at the end of the reporting period.

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The Public Warrants are publicly traded and as such are classified as Level 1 and no longer require a valuation. Inherent in a binomial model are assumptions related to expected stock-price volatility, expected term, dividend yield and risk-free interest rate. The Company estimates the volatility of its Class A ordinary shares based on management’s understanding of the volatility associated with instruments of other similar entities. The risk-free interest rate is based on the U.S. Treasury Constant Maturity similar to the expected remaining term of the Private Placement Warrants. The expected term of the Private Placement Warrants is simulated based on management assumptions regarding the timing and likelihood of completing a Business Combination. The dividend rate is based on the historical rate, which the Company anticipates will remain at zero. The Company transferred the Private Placement Warrants from Level 3 to Level 2 during the year ended December 31, 2022, as the inputs significant to the valuation became observable as they are benchmarked to those used for the Public Warrants.

The following table presents the changes in the fair value of our liabilities classified as Level 3 as of March 31, 2023 and December 31, 2022:

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