☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Cayman Islands | 001-41135 | |||
(State or other jurisdiction of incorporation) | ||||
File Number) | ( Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Class A ordinary shares, par value $0.0001 per share | TGAA | The Nasdaq | ||
Redeemable warrants, each whole warrant exercisable for one Class A ordinary share at an exercise price of $11.50 | TGAAW | The Nasdaq | ||
Units, each consisting of one Class A ordinary share and one-third of one redeemable warrant | TGAAU | The Nasdaq |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
Emerging growth company | ☒ |
Auditor Firm Id: PCAOB ID 688 | Auditor Name: Marcum LLP | Auditor Location: West Palm Beach, Florida |
TARGET GLOBAL ACQUISITION I CORP.
TABLE OF CONTENTS
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Item 1. | 1 | |||||
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3 | ||||||
4 | ||||||
5 | ||||||
Item 2. | ||||||
Item 3. | ||||||
Item 4. | ||||||
Item 1. | ||||||
Item 1A. | ||||||
Item 2. | ||||||
Item 3. | ||||||
Item 4. | ||||||
Item 5. | ||||||
Item 6. | ||||||
June 30, 2022 (Unaudited) | December 31, 2021 (Audited) | |||||||
Assets: | ||||||||
Current assets: | ||||||||
Cash | $ | 416,816 | $ | 1,006,074 | ||||
Prepaid expenses | 254,423 | 200,478 | ||||||
Total current assets | 671,239 | 1,206,552 | ||||||
Prepaid expenses, non-current | — | 163,973 | ||||||
Investment held in Trust Account | 219,421,518 | 219,204,052 | ||||||
Total assets | $ | 220,092,757 | $ | 220,574,577 | ||||
Liabilities, Shares Subject to Redemption and Shareholders’ Deficit | ||||||||
Current liabilities: | ||||||||
Accounts payable and accrued expenses | $ | 570,059 | $ | 502,745 | ||||
Due to related party | 67,419 | 7,419 | ||||||
Promissory Note—Related Party | — | 42,156 | ||||||
Over-allotment liability | — | 30,207 | ||||||
Total current liabilities | 637,478 | 582,527 | ||||||
Deferred underwriting commissions | 7,521,380 | 7,521,380 | ||||||
Total liabilities | 8,158,858 | 8,103,907 | ||||||
Commitments and Contingencies (Note 6) | 0 | 0 | ||||||
Class A ordinary shares subject to possible redemption, 21,489,658 shares at redemption value of $10.21and $10.20 at June 30, 2022 and December 31, 2021, respectively | 219,421,517 | 219,194,512 | ||||||
Shareholders’ Deficit | ||||||||
Preference shares, $0.0001 par value; 5,000,000 shares authorized; 0ne issued and outstanding at June 30, 2022 and December 31, 2021 | 0— | 0— | ||||||
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; 0ne outstanding (excluding 21,489,658 shares subject to possible redemption) at June 30, 2022 and December 31, 2021 | 0— | 0— | ||||||
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 5,372,415 shares issued and outstanding at June 30, 2022 and December 31, 2021 | 537 | 537 | ||||||
Accumulated deficit | (7,488,155 | ) | (6,724,379 | ) | ||||
Total Shareholders’ Deficit | (7,487,618 | ) | (6,723,842 | ) | ||||
Total Liabilities, Shares Subject to Redemption and Shareholders’ Deficit | $ | 220,092,757 | $ | 220,574,577 | ||||
For the three months ended June 30, | For the six months ended June 30, 2022 | For the period from February 2, 2021 (inception) through June 30, 2021 | ||||||||||||||
2022 | 2021 | |||||||||||||||
General and administrative expenses | $ | 255,656 | $ | 1,409 | $ | 784,444 | $ | 10,072 | ||||||||
Loss from operations | (255,656 | ) | (1,409 | ) | (784,444 | ) | (10,072 | ) | ||||||||
Other income | ||||||||||||||||
Interest income on investment held in Trust Account | 160,001 | — | 217,466 | — | ||||||||||||
Change in fair value of overallotment liability | — | — | 30,207 | — | ||||||||||||
T otal other income | 160,001 | — | 247,673 | — | ||||||||||||
Net loss | $ | (95,655 | ) | $ | (1,409 | ) | $ | (536,771 | ) | $ | (10,072 | ) | ||||
Basic and diluted weighted average shares outstanding, Class A ordinary shares subject to possible redemption | 21,489,658 | — | 21,489,658 | — | ||||||||||||
Basic and diluted net loss per share, Class A ordinary shares subject to possible redemption | $ | (0.00 | ) | $ | — | $ | (0.02 | ) | $ | — | ||||||
Basic and diluted, weighted average shares outstanding, Class B non-redeemable ordinary shares | 5,372,415 | 6,250,000 | 5,372,415 | 6,250,000 | ||||||||||||
Basic and diluted net loss per share, Class Bnon-redeemable ordinary shares | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.02 | ) | $ | (0.00 | ) | ||||
Class A Ordinary Shares subject to redemption | Class B Ordinary Shares | Additional Paid-in Capital | Accumulated Deficit | Shareholders’ Deficit | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of December 31, 2021 | 21,489,658 | $ | 219,194,512 | 5,372,415 | $ | 537 | $ | — | $ | (6,724,379 | ) | $ | (6,723,842 | ) | ||||||||||||||
Net loss | — | — | — | — | — | (441,116 | ) | (441,116 | ) | |||||||||||||||||||
Balance as of March 31, 2022 | 21,489,658 | $ | 219,194,512 | 5,372,415 | $ | 537 | $ | — | $ | (7,165,495 | ) | $ | (7,164,958 | ) | ||||||||||||||
Accretion for Class A Common Stock to redemption value | 227,005 | (227,005 | ) | (227,005 | ) | |||||||||||||||||||||||
Net loss | — | — | — | — | — | (95,655 | ) | (95,655 | ) | |||||||||||||||||||
Balance as of June 30, 2022 | 21,489,658 | $ | 219,421,517 | 5,372,415 | $ | 537 | $ | — | $ | (7,488,155 | ) | $ | (7,487,618 | ) | ||||||||||||||
Class A Ordinary Shares subject to redemption | Class B Ordinary Shares | Additional Paid-in Capital | Accumulated Deficit | Shareholders’ Equity | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of February 2, 2021 (inception) | 21,489,658 | $ | 219,194,512 | �� | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Class B ordinary shares issued to Sponsor | — | — | 5,750,000 | 575 | 24,425 | — | 25,000 | |||||||||||||||||||||
Net loss | — | — | — | — | — | (8,663 | ) | (8,663 | ) | |||||||||||||||||||
Balance as of March 31, 2021 | 21,489,658 | $ | 219,194,512 | 5,750,000 | $ | 575 | $ | 24,425 | $ | (8,663 | ) | $ | 16,337 | |||||||||||||||
Net loss | — | — | — | — | — | (1,409 | ) | (1,409 | ) | |||||||||||||||||||
Balance as of June 30, 2021 | 21,489,658 | $ | 219,194,512 | 5,750,000 | $ | 575 | $ | 24,425 | $ | (10,072 | ) | $ | 14,928 | |||||||||||||||
For the six months ended June 30, 2022 | For the period from February 2, 2021 (inception) through June 30, 2021 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (536,771 | ) | $ | (10,072 | ) | ||
Adjustments to reconcile net loss to net cashused in operating activities: | ||||||||
Formation costs paid by Sponsor | — | 8,663 | ||||||
Interest earned on investment held in Trust Account | (217,466 | ) | — | |||||
Change in fair value of overallotment liability | (30,207 | ) | — | |||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | 110,028 | — | ||||||
Accounts payable and accrued expenses | 67,314 | 1,409 | ||||||
Due to related party | 60,000 | — | ||||||
Net cash used in operating activities | (547,102 | ) | — | |||||
Cash flow from a financing activity: | ||||||||
Payment of promissory note—related party | (42,156 | ) | — | |||||
Net cash used by a financing activity | (42,156 | ) | — | |||||
Net change in cash | (589,258 | ) | — | |||||
Cash, beginning of the period | 1,006,074 | — | ||||||
Cash, end of the period | $ | 416,816 | $ | — | ||||
Supplemental disclosure of cash flow information: | ||||||||
Deferred offering costs paid by Sponsor in exchange for issuance of Class B ordinary shares | $ | — | $ | 25,000 | ||||
Deferred offering costs included in accounts payable and accrued expenses | $ | — | $ | 911,014 | ||||
June 30, 2023 (Unaudited) | December 31, 2022 | |||||||
Assets: | ||||||||
Current assets: | ||||||||
Cash | $ | 6,286 | $ | 394,251 | ||||
Prepaid expenses | 42,116 | 111,739 | ||||||
Total current assets | 48,402 | 505,990 | ||||||
Investment held in Trust Account | 48,013,165 | 222,234,685 | ||||||
Total assets | $ | 48,061,567 | $ | 222,740,675 | ||||
Liabilities, Shares Subject to Redemption and Shareholders’ Deficit | ||||||||
Current liabilities: | ||||||||
Accounts payable and accrued expenses | $ | 652,302 | $ | 157,805 | ||||
Due to related party | 187,419 | 127,419 | ||||||
Promissory Note—Related Party | 770,015 | 500,000 | ||||||
Total current liabilities | 1,609,736 | 785,224 | ||||||
Deferred underwriting commissions | 3,760,690 | 7,521,380 | ||||||
Total liabilities | 5,370,426 | 8,306,604 | ||||||
Commitments and Contingencies (Note 6) | ||||||||
Class A ordinary shares subject to possible redemption, 4,495,530 and 21,489,658 shares at redemption value of $10.68 and $10.34 at June 30, 2023 and December 31, 2022, respectively | 48,013,165 | 222,234,685 | ||||||
Shareholders’ Deficit | ||||||||
Preference shares, $0.0001 par value; 5,000,000 shares authorized; none issued and outstanding at June 30, 2023 and December 31, 2022 | — | — | ||||||
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; none outstanding (excluding 4,495,530 and 21,489,658 shares subject to possible redemption) at June 30, 2023 and December 31, 2022, respectively | — | — | ||||||
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 5,372,415 shares issued and outstanding at June 30, 2023 and December 31, 2022 | 537 | 537 | ||||||
Additional Paid in Capital | 3,760,690 | — | ||||||
Accumulated deficit | (9,083,251 | ) | (7,801,151 | ) | ||||
Total Shareholders’ Deficit | (5,322,024 | ) | (7,800,614 | ) | ||||
Total Liabilities, Shares Subject to Redemption and Shareholders’ Deficit | $ | 48,061,567 | $ | 222,740,675 | ||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
General and administrative expenses | $ | 759,843 | $ | 255,656 | $ | 1,012,085 | $ | 784,444 | ||||||||
Loss from operations | (759,843 | ) | (255,656 | ) | (1,012,085 | ) | (784,444 | ) | ||||||||
Other income: | ||||||||||||||||
Interest income on investment held in Trust Account | 2,132,916 | 160,001 | 4,490,937 | 217,466 | ||||||||||||
Change in fair value of over-allotment liability | — | — | — | 30,207 | ||||||||||||
Total other income | 2,132,916 | 160,001 | 4,490,937 | 247,673 | ||||||||||||
Net income (loss) | $ | 1,373,073 | $ | (95,655 | ) | $ | 3,478,852 | $ | (536,771 | ) | ||||||
Basic and diluted weighted average shares outstanding, Class A ordinary shares subject to possible redemption | 17,194,439 | 21,489,658 | 19,330,183 | 21,489,658 | ||||||||||||
Basic and diluted net income (loss) per share, Class A ordinary shares subject to possible redemption | $ | 0.06 | $ | (0.00 | ) | $ | 0.14 | $ | (0.02 | ) | ||||||
Basic and diluted, weighted average shares outstanding, Class B non-redeemable ordinary shares | 5,372,415 | 5,372,415 | 5,372,415 | 5,372,415 | ||||||||||||
Basic and diluted net income (loss) per share, Class B non-redeemable ordinary shares | $ | 0.06 | $ | (0.00 | ) | $ | 0.14 | $ | (0.02 | ) | ||||||
Class B Ordinary Shares | Additional Paid-in Capital | Accumulated Deficit | Shareholders’ Deficit | |||||||||||||||||
Shares | Amount | |||||||||||||||||||
Balance as of December 31, 2022 | 5,372,415 | $ | 537 | $ | — | $ | (7,801,151 | ) | $ | (7,800,614 | ) | |||||||||
Accretion for Class A ordinary shares to redemption value | — | — | — | (2,358,022 | ) | (2,358,022 | ) | |||||||||||||
Partial waiver of deferred underwriters’ discount | 3,760,690 | — | 3,760,690 | |||||||||||||||||
Net income | — | — | — | 2,105,779 | 2,105,779 | |||||||||||||||
Balance as of March 31, 2023 | 5,372,415 | $ | 537 | $ | 3,760,690 | $ | (8,053,394 | ) | $ | (4,292,167 | ) | |||||||||
Accretion for Class A ordinary shares to redemption value | — | — | — | (2,402,931 | ) | (2,402,931 | ) | |||||||||||||
Net income | — | — | — | 1,373,073 | 1,373,073 | |||||||||||||||
Balance as of June 30, 2023 | 5,372,415 | $ | 537 | $ | 3,760,690 | $ | (9,083,251 | ) | $ | (5,322,024 | ) | |||||||||
Class B Ordinary Shares | Additional Paid-in Capital | Accumulated Deficit | Shareholders’ Deficit | |||||||||||||||||
Shares | Amount | |||||||||||||||||||
Balance as of December 31, 2021 | 5,372,415 | $ | 537 | $ | — | $ | (6,724,379 | ) | $ | (6,723,842 | ) | |||||||||
Net loss | — | — | — | (441,116 | ) | (441,116 | ) | |||||||||||||
Balance as of March 31, 2022 | 5,372,415 | $ | 537 | $ | — | $ | (7,165,495 | ) | $ | (7,164,958 | ) | |||||||||
Accretion for Class A ordinary shares to redemption value | (227,005 | ) | (227,005 | ) | ||||||||||||||||
Net loss | — | — | — | (95,655 | ) | (95,655 | ) | |||||||||||||
Balance as of June 30, 2022 | 5,372,415 | $ | 537 | $ | — | $ | (7,488,155 | ) | $ | (7,487,618 | ) | |||||||||
For the Six Months Ended June 30, | ||||||||
2023 | 2022 | |||||||
Cash flows from operating activities: | ||||||||
Net income (loss) | $ | 3,478,852 | $ | (536,771 | ) | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
Interest earned on investment held in Trust Account | (4,490,937 | ) | (217,466 | ) | ||||
Change in fair value of over-allotment liability | — | (30,207 | ) | |||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | 69,623 | 110,028 | ||||||
Accounts payable and accrued expenses | 494,497 | 67,314 | ||||||
Due to related party | 60,000 | 60,000 | ||||||
Net cash used in operating activities | (387,965 | ) | (547,102 | ) | ||||
Cash flows from investing activities: | ||||||||
Extension contributions in Trust Account | (270,015 | ) | — | |||||
Cash withdrawn from Trust Account in connection with redemption | 178,982,472 | — | ||||||
Payment of promissory note—related party | — | (42,156 | ) | |||||
Net cash provided by (used in) investing activities | 178,712,457 | (42,156 | ) | |||||
Cash flow from financing activity: | ||||||||
Redemption of shares | (178,982,472 | ) | — | |||||
Payment of promissory note—related party | 270,015 | — | ||||||
Net cash used in a financing activity | (178,712,457 | ) | — | |||||
Net change in cash | (387,965 | ) | (589,258 | ) | ||||
Cash, beginning of the period | 394,251 | 1,006,074 | ||||||
Cash, end of the period | $ | 6,286 | $ | 416,816 | ||||
Supplemental disclosure of cash flow information: | ||||||||
Impact of partial waiver of deferred underwriters’ fee | $ | 3,760,690 | $ | — | ||||
Accretion for Class A ordinary shares to redemption | $ | 4,760,952 | $ | — | ||||
1) | to amend the Company’s amended and restated memorandum and articles of association (the “Articles”) to |
i. | extend the date (the “Termination Date”) by which the Company has to consummate an initial Business Combination (the “Extension Amendment”) from June 13, 2023 (the “Original Termination Date”) to September 13, 2023 (the “Articles Extension Date”) and to allow the Company, without another shareholder vote, to elect to further extend the Termination Date to consummate an initial Business Combination on a monthly basis for up to six times by an additional one month each time after the Articles Extension Date, by resolution of the Company’s board of directors, if requested by the Sponsor, and upon two calendar days’ advance notice prior to the applicable Termination Date, until March 13, 2024 (each, an “Additional Articles Extension Date”), or a total of up to nine months after the Original Termination Date, unless the closing of an initial Business Combination shall have occurred prior thereto, |
ii. | to eliminate from the Articles the limitation that the Company shall not redeem Class A ordinary shares to the extent that such redemption would cause the Company’s net tangible assets to be less than $5,000,001, and |
iii. | to provide that the Class B ordinary shares of the Company may be converted either at the time of the consummation of the Company’s initial Business Combination or at any earlier date at the option of the holders of the Class B ordinary shares; and |
2) | to amend that certain investment management trust agreement, dated December 8, 2021 (the “Trust Agreement”), by and between the Company and Continental Stock Transfer & Trust Company, as trustee (“Continental”) to change the date on which Continental must commence liquidation (the “Trust Amendment”) of the Trust Account to the earliest of (i) the Company’s completion of an initial Business Combination; (ii) the Articles Extension Date, and (iii) the Additional Articles Extension Date. |
Carrying Value as of June 30, 2022 | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value as of June 30, 2022 | |||||||||||||
U.S. Treasury Securities (matures August 16, 2022 ) | $ | 219,421,518 | $ | — | $ | (5,543 | ) | $ | 219,415,975 |
Carrying Value as of June 30, 2023 | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value as of June 30, 2023 | |||||||||||||
U.S. Treasury Securities Fund | $ | 48,013,165 | $ | — | $ | — | $ | 48,013,165 | ||||||||
Carrying Value as of December 31, 2022 | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value as of December 31, 2022 | |||||||||||||
U.S. Treasury Securities Fund | $ | 222,234,685 | $ | — | $ | — | $ | 222,234,685 |
Carrying Value as of December 31, 2021 | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value as of December 31, 2021 | |||||||||||||
U.S. Treasury Securities ( matured June 16, 2022 ) | $ | 219,204,052 | $ | — | $ | (24,956 | ) | $ | 219,179,096 |
Gross proceeds | $ | 214,896,580 | $ | 214,896,580 | ||||
Less: | ||||||||
Proceeds allocated to Public Warrants | (2,865,288 | ) | (2,865,288 | ) | ||||
Class A ordinary shares issuance costs | (12,738,617 | ) | (12,738,617 | ) | ||||
Plus: | ||||||||
Remeasurement of carrying value to redemption value | 20,128,842 | 22,942,009 | ||||||
Class A ordinary shares subject to possible redemption, December 31, 2022 | 222,234,685 | |||||||
Less: | ||||||||
Redemptions | (178,982,472 | ) | ||||||
Plus: | ||||||||
Remeasurement of carrying value to redemption value | 4,760,952 | |||||||
Class A ordinary shares subject to possible redemption | $ | 219,421,517 | ||||||
Class A ordinary shares subject to possible redemption, June 30, 2023 | $ | 48,013,165 | ||||||
For the three months ended June 30, | For the six months ended June 30, 2022 | For the period from February 2, 2021 (inception) through June 30, 2021 | ||||||||||||||
2022 | 2021 | |||||||||||||||
Class A ordinary shares subject to possible redemption | ||||||||||||||||
Numerator: | ||||||||||||||||
Net loss allocable to Class A ordinary shares subject to possible redemption | $ | (76,524 | ) | $ | — | $ | (429,417 | ) | $ | — | ||||||
Denominator: | ||||||||||||||||
Weighted Average Class A ordinary shares subject to possible redemption, basic and diluted | 21,489,658 | — | 21,489,658 | — | ||||||||||||
Basic and Diluted net loss per share, Class A ordinary shares subject to possible redemption | $ | (0.00 | ) | $ | — | $ | (0.02 | ) | $ | — | ||||||
Class B non-redeemable ordinary shares | ||||||||||||||||
Numerator: | ||||||||||||||||
Net loss allocable to Class B ordinary shares | $ | (19,131 | ) | $ | (1,409 | ) | $ | (107,354 | ) | $ | (10,072 | ) | ||||
Denominator: | ||||||||||||||||
Weighted Average Class B ordinary shares, basic and diluted | 5,372,415 | 6,250,000 | 5,372,415 | 6,250,000 | ||||||||||||
Basic and diluted net loss per share, Class B ordinary shares | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.02 | ) | $ | (0.00 | ) | ||||
For the Three Months Ended June 30, | ||||||||||||||||
2023 | 2022 | |||||||||||||||
Class A | Class B | Class A | Class B | |||||||||||||
Basic and diluted net income (loss) per ordinary share | ||||||||||||||||
Numerator: | ||||||||||||||||
Allocation of net income (loss) | $ | 1,043,535 | $ | 329,538 | $ | (76,524 | ) | $ | (19,131 | ) | ||||||
Denominator: | ||||||||||||||||
Basic and diluted weighted average shares outstanding | 17,194,439 | 5,372,415 | 21,489,658 | 5,372,415 | ||||||||||||
Basic and diluted net income (loss) per ordinary share | $ | 0.06 | $ | 0.06 | $ | (0.00 | ) | $ | (0.00 | ) | ||||||
For the Six Months Ended June 30, | ||||||||||||||||
2023 | 2022 | |||||||||||||||
Class A | Class B | Class A | Class B | |||||||||||||
Basic and diluted net income (loss) per ordinary share | ||||||||||||||||
Numerator: | ||||||||||||||||
Allocation of net income (loss) | $ | 2,713,505 | $ | 765,347 | $ | (429,417 | ) | $ | (107,354 | ) | ||||||
Denominator: | ||||||||||||||||
Basic and diluted weighted average shares outstanding | 19,330,183 | 5,372,415 | 21,489,658 | 5,372,415 | ||||||||||||
Basic and diluted net income (loss) per ordinary share | $ | 0.14 | $ | 0.14 | $ | (0.02 | ) | $ | (0.02 | ) | ||||||
June 30, 2023 | Quoted Prices In Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
U.S. Treasury Securities Fund | $ | 48,013,165 | $ | 48,013,165 | $ | — | $ | — | ||||||||
$ | 48,013,165 | $ | 48,013,165 | $ | — | $ | — | |||||||||
December 31, 2022 | Quoted Prices In Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
U.S. Treasury Securities Fund | $ | 222,234,685 | $ | 222,234,685 | $ | — | $ | — | ||||||||
$ | 222,234,685 | $ | 222,234,685 | $ | — | $ | — | |||||||||
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
References to the “Company,” “Target Global Acquisition I Corp.,” “our,” “us” or “we” refer to Target Global Acquisition I Corp. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited interim condensed financial statements and the notes thereto contained elsewhere in this report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form
Overview
We are a blank check company incorporated on February 2, 2021 as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (the “Business Combination”).
Our sponsor is Target Global Sponsor Ltd., a Cayman Islands company limited by shares (the “Sponsor”). The registration statement for our initial public offering was declared effective on December 8, 2021. On December 13, 2021, we commenced our initial public offering (the “IPO”) of 20,000,000 units at $10.00 per unit. Transaction costs related to the IPO amounted to $12,535,264 consisting of $4,000,000 of underwriting commissions, $7,000,000 of deferred underwriting commissions (including the portion of the deferred underwriting commission subsequently waived by BofA Securities Inc., one of the two underwriters of our IPO (“BofA”) on January 10, 2023), $510,000 in value of the over-allotment option, and $1,025,264 of other offering costs.
Simultaneously with the consummation of the IPO, we consummated the private placement of 6,666,667 warrants (the “Private Placement Warrants”) to the Sponsor, at a price of $1.50 per Private Placement Warrant in a private placement. The sale of the Private Placement Warrants in connection with the IPO generated gross proceeds of $10,000,000.
On December 29, 2021, the underwriters partially exercised their over-allotment option, resulting in an additional 1,489,658 Units issued for gross proceeds of $14,896,580.
Following the closing of the IPO on December 13, 2021, and the subsequent close of the partial over-allotment option on December 29, 2021, a total of $219,194,512 from the net proceeds of the sale of the Units in the IPO and over-allotment and the sale of the Private Placement Warrants was deposited into a trust account (the “Trust Account”) and will bewas invested only in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule
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Our amended and restated memorandum and articles of association provides that we will have only 18 months from the closing of the IPOuntil September 13, 2023 (or up to 24 months from the closing of the IPOuntil March 13, 2024 if we extend the period of time to consummate a Business Combination, subject to the Sponsor depositing additional funds in the Trust Account)Combination) (the “Combination Period”) to consummate the initial Business Combination. If we have not consummated an initial Business Combination within the Combination Period, we will: (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a
On June 2, 2023, shareholders of the Company at the Shareholder Meeting agreed, among other things:
1) | to amend the Company’s Articles to (i) extend the Termination Date by which the Company has to consummate an initial Business Combination from the Original Termination Date to the Articles Extension Date and to allow the Company, without another shareholder vote, to elect to further extend the Termination Date to an Additional Articles Extension Date, (ii) to eliminate from the Articles the limitation that the Company shall not redeem Class A ordinary shares to the extent that such redemption would cause the Company’s net tangible assets to be less than $5,000,001 and (iii) to provide that the Class B ordinary shares of the Company may be converted either at the time of the consummation of the Company’s initial Business Combination or at any earlier date at the option of the holders of the Class B ordinary shares; and |
2) | to amend the Trust Agreement by and between the Company and Continental to change the date on which Continental must commence liquidation of the Trust Account to the earliest of (i) the Company’s completion of an initial Business Combination; (ii) the Articles Extension Date and (iii) the Additional Articles Extension Date. |
The foregoing description of the proposals approved at the Shareholder Meeting is qualified in its entirety by the full text of the Company’s Current Report on Form 8-K filed with the SEC on June 8, 2023.In connection with the shareholders’ vote at the Shareholder Meeting, the holders of 16,994,128 ordinary shares of the Company properly exercised their right to redeem their shares for cash at a redemption price of approximately $10.53 per share. As a result, approximately $178.9 million was removed from the Trust Account to redeem such shares and Capital Resources
In connection with the Extension Amendment, the Contributor agreed to deposit into the Trust Account the Contribution (i) on June 14, 2023, with respect to the extension to the Articles Extension Date, an amount equal to the lesser of (x) $270,000 or (y) $0.084 per public share multiplied by the number of public shares outstanding, and (ii) one business day following the public announcement by the Company disclosing that the Company’s board of directors has determined to extend the date by which the Company must consummate an initial Business Combination for an additional month, with respect to the extension to each such Additional Articles Extension Date, an amount equal to the lesser of (x) $90,000 or (y) $0.028 per public share multiplied by the number of public shares outstanding, with the maximum aggregate amount of Contributions being $810,000. It was further agreed that the Contributions will be evidenced by the Contribution Note and will be repayable by the Company upon the Maturity Date. As of June 30, 2022,2023, the initial Contribution into the Trust Account was $270,015.
The Contribution Note may be converted into warrants of the post-business combination entity, which shall have terms identical to the Private Placement Warrants sold concurrently with the IPO, each exercisable for one Class A ordinary share at a purchase price of $11.50 per share, at a price of $1.50 per warrant at the option of the Contributor. The conversion feature included in the Contribution Note does not meet the definition of a derivative instrument.
Liquidity, Capital Resources and Going Concern
As of June 30, 2023, we had cash outside the Trust Account of $416,816,$6,286, available for working capital needs, and working capitaldeficit of $33,761.$1,561,334. Until consummation of its Business Combination, we will be using the funds held outside the Trust Account, and any additional Working Capital Loans from the initial shareholders, our officers and directors, or their respective affiliates, or other third parties, for identifying and evaluating prospective acquisition candidates, performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting the target business to acquire and structuring, negotiating and consummating the Business Combination.
Our liquidity needs up to June 30, 20222023 had been satisfied through a payment from the Sponsor of $25,000 for the Founder Shares to cover certain offering costs and the loan under an unsecured promissory note from the Sponsor of up to $500,000. As of June 30, 2022,2023, we had no$770,015 borrowing outstanding borrowing under the promissory note.
In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor, initial shareholders, officers, directors or their affiliates may, but are not obligated to, provide us Working Capital Loans. As of June 30, 2022,2023, there were no amounts outstanding under any Working Capital Loans.
We have sufficient working capital and borrowing capacityuntil September 13, 2023, to meet our needs through the earlier of the consummation ofcomplete a Business Combination or one year from this filing. Over thisunless the Company extends the Termination Date. The Company may extend the period of time period,to consummate a Business Combination by up to six one-month periods after September 13, 2023, until March 13, 2024. However, if we are unable to complete a business combination until March 13, 2024, we will redeem 100% of the outstanding public shares for a pro rata portion of
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the funds held in the Trust Account, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us, divided by the number of then outstanding public shares, subject to applicable law and as further described in our registration statement, and then seek to dissolve and liquidate. In connection with the our assessment of going concern considerations in accordance with the authoritative guidance FASB Accounting Standards Update (“ASU”) Topic 2014-15, “Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern”, our management has determined that potential liquidity and capital shortage as described above and a mandatory liquidation, and subsequent dissolution, should we be using these funds for paying existing accounts payable, identifyingunable to complete a business combination, raise substantial doubt about our ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target businessliabilities should we be required to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
Risks and Uncertainties
Our management is currently evaluating the impact of the
Results of Operations
As of June 30, 2022,2023, we had not commenced any operations. All activity for the period from February 2, 2021 (inception) through June 30, 20222023 relates to our formation and the IPO. We have neither engaged in any operations nor generated any revenues to date. We will not generate any operating revenues until after the completion of our initial Business Combination, at the earliest. We generate
For the three months ended June 30, 2023, we had net income of $1,373,073, which consisted of income from investments held in the Trust Account and operating account of $ 2,132,916, offset by general and administrative expenses of $759,843.
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For the six months ended June 30, 2023, we had net income of $3,478,852, which consisted of income from investments held in the Trust Account and operating account of approximately $4,490,937, offset by general and administrative expenses of approximately $1,012,085.
For the three months ended June 30, 2022, we had net loss of $95,655, which consisted of general and administrative expenses of $255,656, offset by the income from investments held in the Trust Account and operating account of $160,001.
For the six months ended June 30, 2022, we had net loss of $536,771, which consisted of general and administrative expenses of $784,444, offset by the income from investments held in the Trust Account and operating account of $217,466 and change in fair value of overallotmentover-allotment liability of approximately $30,207.
Contractual Obligations
We do not have any long-term debt obligations, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities.
Office Space, Secretarial and Administrative Services
Commencing on December 9, 2021, through the earlier of consummation of the initial Business Combination and the liquidation, we agreed to pay the Sponsor a total of $10,000 per month for office space, utilities, secretarial and administrative support and to reimburse the Sponsor for any
Registration Rights
The holders of the Founder Shares, Private Placement Warrants, Class A ordinary shares underlying the Private Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans and extension loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans and extension loans) will beare entitled to registration rights pursuant to a registration and shareholder rights agreement to be signed prior to or on the effective date of the Public Offering.agreement. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to our completion of the initial Business Combination. We will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The underwriters had a
The underwriters were paid underwriting commissioncommissions of $0.20 per unit, or $4,000,000 in aggregate, upon the closing of the IPO. Following the exercise of the underwriters’ over-allotment option on December 29, 2021, the underwriters earned an additional $297,932 for an aggregate of $4,297,932 in underwriting commissions related to the IPO and over-allotment.
In addition, $7,000,000 iswas payable to the underwriters for deferred underwriting commissions.commissions (including the portion of the deferred underwriting commissions subsequently waived by BofA on January 10, 2023). Following the exercise of the underwriters’ over-allotment option on December 29, 2021, the underwriters earned an additional $521,380 for an aggregate of $7,521,380 in deferred underwriting commissions related to the IPO and over-allotment. Theover-allotment (including the portion of the deferred underwriting commission will become payablesubsequently waived by BofA). On January 10, 2023, BofA executed a waiver letter confirming BofA’s resignation and waiver of its entitlement to the underwriterspayment of deferred underwriting commission in the amount of $3,760,690. The remaining balance of $3,760,690 owing to UBS has not been waived and remains due and payable from the amounts held in the Trust Account solely in the event that we complete a Business Combination, subject to the terms of the underwriting agreement.
Forward Purchase Agreements
We entered into two forward purchase agreements (the “Forward Purchase Agreements”) with Target Global Selected Opportunities, LLC – Series Selenium (“TGSO Series Selenium”) on November 8, 2021, pursuant to which TGSO Series Selenium agreed to purchase (1) an aggregate of 2,500,000 forward purchase shares for $10.00 per share (the “firm forward purchase shares”), or an aggregate amount of $25,000,000 and (2) in addition, an aggregate of up to 2,500,000 forward purchase shares for $10.00 per share (the “additional forward purchase shares”), or an aggregate maximum amount of up to $25,000,000, in each case in a private placement that may close simultaneously with the closing of the Business Combination. On May 11, 2022, all of TGSO Series Selenium’s rights and obligations under the Forward Purchase Agreements (including the obligation to purchase the Forward Purchase Shares) were transferred in full to Target Global Selected Opportunities, LLC – Series Selenium 3 (the “FPA Purchaser”) in accordance with Section 4(c) of the Forward Purchase Agreements.
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Critical Accounting Policies
Offering Costs Associated with IPO
Deferred offering costs consist of underwriting, legal, accounting and other expenses incurred through the balance sheet date that are directly related to the IPO. We comply with the requirements of the ASC
Ordinary Shares Subject to Possible Redemption
We account for ordinary shares subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Ordinary shares subject to mandatory redemption (if any) are classified as a liability instrument and 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 our control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ deficit. Our Class A ordinary shares feature certain redemption rights that are considered to be outside of our control and subject to the occurrence of uncertain future events. Accordingly, 4,495,530 and 21,489,658 Class A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’ deficit section of our balance sheets.
We recognize changes in redemption value immediately as they occur and adjusts the carrying value of Class A ordinary shares to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable ordinary shares are affected by charges against additional paid in capital and accumulated deficit.
Net LossIncome (Loss) Per Ordinary Share
Net lossincome (loss) per ordinary share is computed by dividing net lossincome (loss) by the weighted average number of ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture by the Sponsor. Weighted average shares were reduced for the effect of an aggregate of 750,000 ordinary shares that are subject to forfeiture if the over-allotment option is not exercised by the underwriters. At June 30, 20222023 and December 31, 2021,2022, we did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in our earnings. As a result, diluted lossincome (loss) per ordinary share is the same as basic lossincome (loss) per share for the period presented.
Recent Accounting Standards
Our management does not believe that any other recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on our unaudited condensed financial statements.
Off-Balance
As of June 30, 20222023 and December 31, 2021,2022, we did not have any
Emerging Growth Company Status
We are an “emerging growth company,”company” as defined in Section 2(a) of the Securities Act of 1933, as amended, (the “Securities Act”), as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may 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, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
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Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We are a smaller reporting company as defined by Rule
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 1A. Risk Factors.
As of the date of this Quarterly Report on Form
We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future filings with the SEC.
On June 15, 2023, the Company received a downturnwritten notice from the Listing Qualifications Department of The Nasdaq Stock Market (“Nasdaq”) indicating that since the Company’s aggregate market value of its outstanding warrants was less than $1 million, the Company was no longer in compliance with the Nasdaq Global Market continued listing criteria set forth in Listing Rule 5452(b)(C), which requires the Company to maintain an aggregate market value of its outstanding warrants of at least $1 million (the “Notice”). The Notice additionally indicated that the Company, pursuant to the Listing Rules, has 45 calendar days, or grows atuntil July 31, 2023, to submit a slower rate than expected, there may be less demand for spending in certain industries. A decrease in demand for spending in certain industries could materially and adversely affect our abilityplan to find an attractive target business with whichregain compliance. If Nasdaq accepts the Company’s plan, the Company will have 180 calendar days from the date of the Notice, or until December 12, 2023, to consummate our initial business combinationevidence compliance. If Nasdaq were to reject the Company’s plan, Nasdaq rules permit the Company to appeal the decision to a hearings panel.
On July 31, 2023, the Company submitted a plan to regain compliance, and, if we effect our initial business combination,Nasdaq accepts such plan, the abilityCompany intends to subsequently regain compliance with Rule 5452(b)(C) within the 180-calendar day compliance period. While the Company is exercising diligent efforts to maintain the listing of its warrants on Nasdaq Global Market, there can be no assurance that target businessthe Company will be able to become profitable.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Not Applicable.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not Applicable.
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Item 5. Other Information.
None.
Item 6. Exhibits
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form
* Filed herewith.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
TARGET GLOBAL ACQUISITION I CORP. | ||||||
Date: | By: | /s/ Shmuel Chafets | ||||
Name: | Shmuel Chafets | |||||
Title: | Chief Executive Officer (Principal Executive Officer) | |||||
Date: August 10, 2023 | By: | /s/ Heiko Dimmerling | ||||
Name: | Heiko Dimmerling | |||||
Title: | Chief Accounting Officer (Principal Financial |