UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 20212022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from          to          

Commission File No. 001-40073

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

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.

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 ☐

As of September 30, 2021,November 10, 2022, 11,980,000 Class A ordinary shares, par value $0.0001 per share, and 2,875,000 Class B ordinary shares, par value $0.0001 per share, were issued and outstanding. outstanding

MORINGA ACQUISITION CORP

QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS

CERTAIN TERMS

Unless otherwise stated in this Quarterly Report on Form 10-Q (this “Quarterly Report” or “Form 10-Q”), references to:

Special Note Regarding Forward-Looking Statements

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, that are not historical facts, and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements other than statements of historical fact included in this Quarterly Report, including statements in “Part I- Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to “Part I- Item 1A. Risk Factors” in the 2021 Annual Report, as supplemented by “Part II- Item 1A. Risk Factors” in this Quarterly Report. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.report. Except as expressly required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

PART 1 –I - FINANCIAL INFORMATION

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2022 AND FOR THE THREE AND NINE MONTHS ENDED ON THAT DATE

U.S. DOLLARS

ITEM 1. FINANCIAL STATEMENTS

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2021, AND FOR THE THREE AND NINE MONTHS ENDED ON THAT DATE

U.S. DOLLARS

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2021,2022 AND FOR THE THREE AND NINE MONTHS ENDED ON THAT DATE

U.S. DOLLARS

INDEX

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED BALANCE SHEETS

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

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED STATEMENTS OF OPERATIONS

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

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (CAPITAL DEFICIENCY)

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

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (CAPITAL DEFICIENCY)

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED STATEMENTS OF CASH FLOWSCHANGES IN SHAREHOLDERS’ EQUITY (CAPITAL DEFICIENCY)

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

MORINGA ACQUISITION CORP

UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS

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

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 - DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS:– Description of Organization and Business Operations:

Moringa Acquisition Corp (hereafter – the Company) is a blank check company, incorporated on September 24, 2020 as a Cayman Islands exempted company, formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination (hereafter – the Business Combination). The Company is an emerging growth 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”).

All activity for the period from September 24, 2020 (inception) throughnine months ended September 30, 20212022, relates to the Company’s formation and its initial public offering (the “Public Offering”) described below. The Company will generate non-operating income insearch for a target company, as well as attempts to consummate the form of interest income on cash and cash equivalents from the proceeds derived from the Public Offering and the Private Placement (as defined belowProposed Business Combination, as detailed in Note 3)1(f).

The Company has selected December 31 as its fiscal year end.

The Company’s sponsor is Moringa Sponsor, L.P., a Cayman exempted limited partnership (which is referred to herein, together with its wholly-owned subsidiary, Moringa Sponsor (US) LP, a Delaware limited partnership, as the “Sponsor”).

The registration statement relating to the Company’s Public Offering was declared effective by the United States Securities and Exchange Commission (the “SEC”) on February 16, 2021. The initial stage of the Company’s Public Offering— the sale of 10,000,000 Units — closed on February 19, 2021.2021 (hereafter – the Closing of the Public Offering). Upon that closing and the concurrent closing of the initial stage of the Private Placement (as defined below in Note 3). $100,000,000 was placed in a trust account (the “Trust Account”) (discussed in (c) below). On March 3, 2021, upon the full exercise by the underwriters of their over-allotment option for the Public Offering, the second stage of the Public Offering — the sale of 1,500,000 Units — closed. Upon that closing and the concurrent closing of the second stage of the Private Placement, an additional $15,000,000 was placed in the Trust Account. The Company intends to finance its initial Business Combination with the net proceeds from the Public Offering and the Private Placement.

The proceeds held in the Trust Account will beare invested in money market funds registered under the Investment Company Act and compliant with Rule 2a-7 thereof that maintain a stable net asset value of $1.00. Unless and until the Company completes the Initial Business Combination, it may pay its expenses only from the net proceeds of the Public Offering and the Private Placements of $3,800 thousand held outside the Trust Account less any offering expenses (not including underwriting commission) paid upon the closing of the Public Offering and the exercise of the underwriters’ over-allotment option in full.

The Company’sCompany complies with the provisions of ASU 2016-18, under which changes in proceeds held in the Trust Account are accounted for as Changes in Cash, Cash Equivalents and Investments Held in a Trust Account in the Company’s Statements of Cash Flows.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 - DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS– Description of Organization and Business Operations (continued):

The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Public Offering, although substantially all of the net proceeds of the Public Offering and the Private Placement are intended to be generally applied toward consummating an initial Business Combination. The initial Business Combination must occur 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 (excluding taxes payable on the income accrued in the Trust Account). There is no assurance that the Company will be able to successfully consummate an initial Business Combination.

The Company, after signing a definitive agreement for an Initial Business Combination, will provide its public shareholders the opportunity to redeem all or a portion of their shares upon the completion of the initial Business Combination, either (i) in connection with a shareholder meeting called to approve the business combination or (ii) by means of a tender offer. However, in no event will the Company redeem its public shares in an amount that would cause its net tangible assets to be less than $5,000,001 following such redemptions. In such case, the Company would not proceed with the redemption of its public shares and the related initial Business Combination, and instead may search for an alternate initial Business Combination.

If the Company holds a shareholder vote or there is a tender offer for shares in connection with an initial Business Combination, a public shareholder will have the right to redeem its shares for an amount in cash equal to its pro rata share of the aggregate amount then on deposit in the Trust Account, calculated as of two days prior to the general meeting or commencement of the Company’s tender offer, including interest but less taxes payable. As a result, the Company’s Public Class A ordinary shares are classified as temporary equity upon the completion of the Public Offering, in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, “Distinguishing Liabilities from Equity.”

Pursuant to the Company’s amended and restated memorandum and articles of association, if the Company is unable to complete the initial Business Combination within 24 months from the closingClosing of the Public Offering, the Company 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 per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining shareholders and the Company’s board of directors, liquidate and dissolve, subject in each case to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 - DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS– Description of Organization and Business Operations (continued):

The Sponsor and the Company’s officers and directors have entered into a letter agreement with the Company, pursuant to which they have waived their rights to liquidating distributions from the Trust Account with respect to any Class B ordinary shares (as described in Note 6)7) held by them if the Company fails to complete the initial Business Combination within 24 months of the closingClosing of the Public Offering or during any extended time that the Company has to consummate an initial Business Combination beyond 24 months as a result of a shareholder vote to amend its amended and restated memorandum and articles of association. However, if the Sponsor or any of the Company’s directors or officers acquire any Class A ordinary shares, they will be entitled to liquidating distributions from the Trust Account with respect to such shares if the Company fails to complete the Initial Business Combination within the prescribed time period.

In the event of a liquidation, dissolution or winding up of the Company after an initial Business Combination, the Company’s shareholders are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of stock, if any, having preference over the ordinary shares. The Company’s shareholders have no preemptive or other subscription rights. There are no sinking fund provisions applicable to the ordinary shares, except that the Company will provide its shareholders with the opportunity to redeem their public shares for cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account, under the circumstances, and, subject to the limitations, described herein.herein

As of September 30, 2022, the Company had approximately $202 thousand of cash and an accumulated deficit of $861 thousand. In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standard Codification 205-40, “Going Concern”, the Company will need to obtain additional funds in order to satisfy its liquidity needs in its current endeavors to consummate the Proposed Business Combination, as detailed in Note 1(f), or a different Initial Business Combination, if the former does not occur.

Since its inception date and through the issuance date of these financial statements, the Company’s liquidity needs were satisfied through an initial capital injection from the Sponsor, followed by net Private Placement proceeds, as well as several withdrawals of the Sponsor promissory notes. Management has determined that it will need to continue to rely and is significantly dependent on future promissory notes or other forms of financial support (of which the Sponsor is not obligated to provide). Moreover, the Company has until February 19, 2023 (hereafter – the Mandatory Liquidation Date) to consummate an Initial Business Combination, whether the Proposed Business Combination or a different one. If a business combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the Company. The Company intends to complete an Initial Business Combination before the Mandatory Liquidation Date. However, there can be no assurance that the Company will be able to consummate any business combination ahead of the Mandatory Liquidation Date, nor will it be able to raise sufficient funds to complete an Initial Business Combination. These matters raise substantial doubt about the Company’s ability to continue as a going concern, for the subsequent twelve months following the issuance date of these financial statements.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 – Description of Organization and Business Operations (continued):

No adjustments have been made to the carrying amounts of assets or liabilities should the Company fail to obtain financial support in its pursuit to consummate an Initial Business Combination, nor if it is required to liquidate after the Mandatory Liquidation Date.

On June 9, 2022, the Company entered into a Business Combination Agreement (hereafter – the Proposed Business Combination) with Holisto Ltd., a company organized under the laws of the State of Israel (hereafter – Holisto) and Holisto MergerSub, Inc., a Cayman Islands exempted company and wholly-owned subsidiary of Holisto.

Holisto is an Israeli company and a tech-powered online travel agency, which aims to make hotel booking affordable and personalized for consumers.

The Business Combination Agreement and the transactions contemplated thereby have been unanimously approved by the boards of directors of Moringa and Holisto, and by the shareholders of Holisto.

The foregoing description of the Proposed Business Combination does not purport to be complete. For further information and access to the full agreement and all other related agreements, refer to the Company’s Current Report on Form 8-K filed with the SEC on June 13, 2022.

NOTE 2 -– SIGNIFICANT ACCOUNTING POLICIES:

The Company’s unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the SEC for interim financial information and the instructions to Form 10-Q.

Certain disclosures included in the annual financial statements have been condensed or omitted from these financial statements as they are not required for interim financial statements under U.S. GAAP and the rules of the SEC. These unaudited condensed financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. These adjustments are of a normal, recurring nature. Interim period operating results may not be indicative of the operating results for a full year.

The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements included in the Company’s final prospectus for the Public Offering filed with the SEC on February 16, 2021, as well as the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the period from September 24, 2020 (inception) to December 31, 2020 dated March 31, 2021.

Comparative figures for the period from September 24, 2020 (inception) to September 30, 2020 were not included as the Company had not yet commenced its operations during that period, nor had it issued any shares.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (continued):

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 non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued):

This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible, because of the potential differences in accounting standards used.

The Company considers as cash equivalents all short-term, highly liquid investments, which include short-term bank deposits with original maturities of three months or less from the date of purchase that are not restricted as to withdrawal or use and are readily convertible to known amounts of cash.

As of September 30, 2021,2022, the Company held its cash and cash equivalents in an SVB bank account, and its CashInvestments Held in Trust Account in Goldman Sachs money market funds. Money market funds are characterized as Level I investments within the fair value hierarchy under ASC 820.

As discussed in Note 1, all of the 11,500,000 shares of Class A ordinary shares sold as parts of the Units in the Public Offering contain a redemption feature. In accordance with the Accounting Standards Codification 480-10-S99-3A “Classification and Measurement of Redeemable Securities”, redemption provisions not solely within the control of the Company require the security to be classified outside of permanent equity. Ordinary liquidation events, which involve the redemption and liquidation of all of the entity’s equity instruments, are excluded from the provisions of ASC 480. The Company has classified all of the shares sold under the Public Units as subject to possible redemption.

Immediately upon the Closing of the Public Offering, the Company recognized the accretion from the offering costs allocated to the Class A Ordinary Shares subject to possible redemption, in an amount of $2,551,880.

The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, Earnings Per Share. Net profit (loss) per share is computed by dividing net profit (loss) by the weighted average number of shares outstanding during the period. The Company applies the two-class method in calculating net profit (loss) per each class of shares: the non-redeemable shares, which include the Private Class A Ordinary Shares, as defined in Note 7, and the Class B ordinary shares (hereafter and collectively – Non-Redeemable class A and B ordinary shares; and the Class A ordinary shares subject to possible redemption.

In order to determine the net profit (loss) attributable to each class, the Company first considered the total profit (loss) allocable to both sets of shares. This is calculated using the total net profit (loss) less any Interest Earned on Investments Held in Trust Account. Then, the Interest Earned on Investments Held in Trust Account for the period (being the accretion to redemption value of the Class A ordinary shares subject to possible redemption) is fully allocated to the Class A ordinary shares subject to redemption.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 2 -– SIGNIFICANT ACCOUNTING POLICIES (continued):

The Company complies with accountingFor each of the three and disclosure requirements of FASB ASC Topic 260, Earnings Per Share. Net loss per share is computed by dividing net loss by the weighted average number of ordinary shares outstanding during the period. The Company applies the two-class method in calculating net loss per each share – Class A ordinary share subject to possible redemption, non-redeemable Class A and Class B ordinary shares.

As ofnine months ended September 30, 2021, the Company had outstanding warrants to purchase up to 5,940,000 Class A ordinary shares. The weighted average of these shares was excluded from the calculation of diluted net loss per share since the exercise of the warrants is contingent upon the occurrence of future events. As of September 30,2022 and 2021, the Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into shares and then share in the earnings of the Company. The Company has not considered the effect of the warrants sold in the Initial Public Offering and Private Placements to purchase an aggregate of 5,940,000 warrants in the calculation of diluted net profit (loss) per share, since the exercise of the warrants is contingent upon the occurrence of future events. As a result, diluted net lossprofit (loss) per share is the same as basic net lossprofit (loss) per share for each of the period.periods presented, and for each class.

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.

The Company applied the provisions of ASC 815-40 and classified its public warrants, issued as part of the Public Units as detailed in Note 3, as equity securities.

The Company accounts for the warrants in accordance with the guidance contained in Accounting Standards Codification 815 (“ASC 815”), “Derivatives and Hedging”, under which the warrants do not meet the criteria for equity treatment and must be recorded as derivative liabilities. Accordingly, the Company classifies the warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until the warrants are exercised or expire, and any change in fair value is recognized in the Company’s statement of operations. The fairRefer to Note 6 for information regarding the model used to estimate the faie value of the Private Warrants (as defined in Note 3) has been estimated using a Black-Scholes-Merton model..

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under the FASB ASC 820, “Fair Value Measurements and Disclosures”, approximates the carrying amounts represented in the balance sheet, primarily due to their short-term nature.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (continued):

The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates and such differences may have a material impact on the Company’s financial statements.

MORINGA ACQUISITION CORP

The Company complies with the requirements of the Accounting Standards Codification 340-10-S99-1 and SEC Staff Accounting Bulletin Topic 5A – “Expenses of Offering”. The Company incurred offering costs in connection with its Public Offering of $334,345. These costs, together with the upfront underwriter discount, of $2,300,000 were allocated between the sale of the Public Units and the Private Units.NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continued):

Out of the total amount of offering costs, $2,626,857 were charged to Additional Paid-in Capital upon the closing of the Public Offering. The remaining amount of $7,599 was allocated to the Private Warrant Liability, and therefore charged as an expense.

The Company accounts for income taxes in accordance with ASC 740, “Income Taxes (hereafter – ASC 740). ASC 740 prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more likely than not that a portion or all of the deferred tax assets will not be realized, based on the weight of available positive and negative evidence. Deferred tax liabilities and assets are classified as non-current in accordance with ASU 2015-17.

The Company accounts for uncertain tax positions in accordance with ASC 740-10. ASC 740-10 contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% (cumulative probability) likely to be realized upon ultimate settlement. The Company accrues interest and penalties related to unrecognized tax benefits under taxes on income (tax benefit).

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (continued):

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

NOTE 3 -– PUBLIC OFFERING AND PRIVATE PLACEMENTS:

In the Initial Public Offering, the Company issued and sold 11,500,000 units (including 1,500,000 units sold at a second closing pursuant to the underwriters’ exercise of their over-allotment option in full) at an offering price of $10.00 per unit (the “Units”). The Sponsor and EarlyBirdCapital, Inc. (the representative of the underwriters) purchased, in a private placement that occurred simultaneously with the two closings of the initial Public Offering (the “Private Placement”), an aggregate of 352,857 and 27,143 Units, respectively, at a price of $10.00 per Unit.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 3 – PUBLIC OFFERING AND PRIVATE PLACEMENTS (continued):

Each Unit (both those sold in the initial Public Offering and in the Private Placement) consists of one Class A ordinary share, $0.0001 par value, and one-half of one warrant, with each whole warrant exercisable for one Class A ordinary share (each, a “Public Warrant” and a “Private Warrant”, and collectively, the “Warrants”). Each Warrant entitles the holder thereof to purchase one whole Class A ordinary share at a price of $11.50 per share, subject to adjustment. No fractional shares will be issued upon exercise of the Warrants and only whole Warrants will trade. Each Warrant will become exercisable 30 days after the completion of the Company’s initial Business Combination and will expire at 5:00 p.m., New York City time, five years after the completion of the initial Business Combination or earlier upon redemption (only in the case of the Warrants sold in the Public Offering, or the “Public Warrants”) or liquidation.

Once the Public Warrants become exercisable, the Company may redeem them in whole and not in part at a price of $0.01 per Warrant upon a minimum of 30 days’ prior written notice of redemption, if and only if the last reported sale price of the Company’s Class A ordinary shares equals or exceeds $18.00 per share (as adjusted) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the Warrant holders.

The Warrants included in the Units sold in the Private Placement (the “Private Warrants”) are identical to the Public Warrants except that the Private Warrants, for so long as they are held by the Sponsor, EarlyBirdCapital, Inc. or their respective affiliates: (1) will not be redeemable by the Company; (2) may not (including the Class A ordinary shares issuable upon exercise of those warrants), subject to certain limited exceptions, be transferred, assigned or sold by the holders thereof until 30 days after the completion of the Company’s initial Business Combination; (3) may be exercised by the holders thereof on a cashless basis; and (4) they (including the Class A ordinary shares issuable upon exercise thereof) are entitled to registration rights.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 3 - PUBLIC OFFERING AND PRIVATE PLACEMENTS (continued):

The Company paid an underwriting commission of 2.0% of the gross proceeds of the Public Offering and the full exercise of the underwriters’ over-allotment, or $2,300,000, in the aggregate, to the underwriters at the two closings of the Public Offering. Refer to Note 5 for more information regarding an additional fee payable to the underwriters upon the consummation of an Initial Business Combination.

NOTE 4 -– RELATED PARTY TRANSACTIONS:

On December 9, 2020, the Company signed a promissory note, under which it could borrow up to a $300 thousand principal amount from the Sponsor. Amounts drawn by the Company under the note were to be used to cover finance costs and expenses related to its formation and capital raise.

The entire unpaid balance was payable on the earlier of (i) March 31, 2021, or (ii) the date of a capital raise (i.e., the closing of the initial Public Offering). Any drawn amounts could be prepaid at any time. The promissory note did not bear any interest on the principal amount outstanding thereunder.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 4 – RELATED PARTY TRANSACTIONS (continued):

The Company borrowed $170 thousand under the promissory note. On March 3, 2021, concurrently with the second closing under the Public Offering, the Company repaid the Sponsornote, $150 thousand of the principal amount due under the promissory note. On February 2021, the Company borrowedprior to December 31, 2020 and an additional $20 thousand and repaid $150 thousand. On March 18, 2021 the Company repaid the remaining $20on February 2021. The total $170 thousand dueowed under the promissory note. Onnote was repaid in March 18, 2021, following the Company repaidClosing of the remaining $120 thousand Related Party balance as well.   Public Offering.

On August 9, 2021 the Company and the Sponsor have entered into an additional Promissory Note agreement (hereafter – the Second Promissory Note), according to which the Company may withdraw up to $1 million to fulfillfulfil its ongoing operational needs or preparations towards an Initial Business Combination. Up until

The entire unpaid balance shall be payable on the issuanceearlier of (i) February 19, 2023, or (ii) the date of these condensed financial statements, noon which the Company consummates its Initial Business Combination. Any drawn amounts have been drawncould be prepaid at any time. The promissory note does not bear any interest on the principal amount outstanding thereunder.

On December 23, 2021, the Company borrowed $300 thousand under the Second Promissory Note.promissory note.

During the nine months ended September 30, 2022 the Company borrowed an additional $700 thousand from the promissory note given by the Sponsor.

On December 16, 2020, the Company signed an agreement with the Sponsor, under which the Company shall pay the Sponsor a fixed $10 thousand per month for office space, utilities and other administrative expenses. The monthly payments under this administrative services agreement commenced on the effective date of the registration statement for the initial Public Offering and will continue until the earlier of (i) the consummation of the Company’s initial Business Combination, or (ii) the Company’s liquidation. As of September 30, 20212022 the Company accrued for approximately $10 thousand with regards to this agreement, recorded under the Related Party balance.

The composition of the Related Party balance as of September 30, 20212022 and December 31, 20202021 is as follows:

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 5 -– COMMITMENTS AND CONTINGENCIES:

Underwriters’ Deferred DiscountCommission

Under the Business Combination Marketing Agreement, the Company shall pay an additional fee (hereafter – the Deferred Discount)Commission) of 3.5% of the gross proceeds of the Public Offering (or $4,025,000) payable upon the Company’s completion of the initial Business Combination. The Deferred DiscountCommission will become payable to the underwriters from the amounts held in the Trust Account solely in the event the Company completes the Initial Business Combination.

NOTE 6 -– FAIR VALUE MEASUREMENTS:

The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (i.e., the exit price).

The fair value hierarchy under ASC 820 prioritizes the inputs to valuation techniques used to measure 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 three levels of the fair value hierarchy are as follows:

Basis for Fair Value Measurement

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices in markets that are not active or financial instruments for which significant inputs to models are observable (including but not limited to quoted prices for similar securities, interest rates, foreign exchange rates, volatility and credit risk), either directly or indirectly;

Level 3: Prices or valuations that require significant unobservable inputs (including the Management’s assumptions in determining fair value measurement).

The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 20212022 by level within the fair value hierarchy:

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 6 -– FAIR VALUE MEASUREMENTS (continued):

The estimated fair value of the Private Placement Warrants was determined using a binomial model to extract the market’s implied probability for an Initial Business Combination, using the Public Warrant’s market price. Once probability was extracted, a Black-Scholes-Merton model with Level 3 inputs.inputs was used to calculate the Private Warrants’ fair value. Inherent in a Black-Scholes-Merton model are assumptions related to expected life (term), expected stock price, volatility, risk-free interest rate and dividend yield. The Company estimates the volatility of its warrants based on implied volatility from the Company’s traded warrants and from historical volatility of selectselected peer companies’ Class A ordinary shares that matches the expected remaining life of the warrants. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the grant date for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants is assumed to be equivalent to their remaining contractual term. The dividend rate is based on the historical rate, which the Company anticipates remaining at zero.

The following table provides quantitative information regarding Level 3 fair value measurements inputs:

The change in the fair value of the Warrants measured with Level 3 inputs for the period from March 3, 2021 (Initial Measurement) through September 30, 2021 is summarized as follows:

NOTE 7 - SHAREHOLDERS’ EQUITY (CAPITAL DEFICIENCY):– CAPITAL DEFICIENCY:

Class A Ordinary Shares

On November 20, 2020 the Company issued 100,000 Class A ordinary shares of $0.0001 par value each to designees of the Representative (hereafter – the Representative Shares) for a consideration equal to the par value of the shares. The Representative Shares are deemed to be underwriters’ compensation by FINRA pursuant to Rule 5110 of the FINRA Manual.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 7 - SHAREHOLDERS’ EQUITY (CAPITAL DEFICIENCY) (continued):

The Company accounted for the issuance of the Representative Shares as compensation expenses amounting to $860, with a corresponding credit to Additional Paid-In Capital, for the excess value over the consideration paid. The Company estimated the fair value of the issuance based upon the price of Class B Ordinary Shares that were issued to the Sponsor.

Pursuant to the initial Public Offering and the concurrent Private Placement that were each effected in two closings— on February 19, 2021 and March 3, 2021— the Company issued and sold an aggregate of 11,500,000 and 380,000 Class A ordinary shares as part of the Units sold in those respective transactions. The Units (which also included Warrants) were sold at a price of $10 per Unit, and for an aggregate consideration of $115 million and $3.8 million in the Public Offering and Private Placement, respectively. See Note 3 above for further information regarding those share issuances.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 7 – CAPITAL DEFICIENCY (continued):

The Company classified its 11,500,000 Public Class A ordinary shares as temporary equity. The remaining 480,000 Private Class A ordinary shares were classified as permanent equity.

Class B Ordinary Shares

On November 20, 2020 the Company issued 2,875,000 Class B ordinary shares of $0.0001 par value each for a total consideration of $25 thousand to the Sponsor’s wholly-owned Delaware subsidiary. Out of the 2,875,00 Class B ordinary shares, up to 375,000 were subject to forfeiture if the underwriters were to not exercise their over-allotment in full or in part. Because the underwriters exercised their over-allotment option in full on March 3, 2021, that potential forfeiture did not occur.

Class B ordinary shares are convertible into non-redeemable Class A ordinary shares, on a one-for-one basis, at any time and from time to time at the option of the holder, or automatically on the day of the Business Combination. Class B ordinary shares also possess the sole right to vote for the election or removal of directors, until the consummation of an initial Business Combination.Combination.

The Company is authorized to issue up to 5,000,000 Preferred Shares of $0.0001 par value each. As of September 30, 2021,2022, the Company has no preferred shares issued and outstanding.

MORINGA ACQUISITION CORP

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 8 – NET PROFIT (LOSS) PER SHARE:

The following table reflects the calculation of basic and diluted net profit (loss) per share (in dollars, except share amounts):

NOTE 9 – SUBSEQUENT EVENTS:

The Company evaluated subsequent events and transactions that occurred after the balance sheet date and through the issuance date of these financial statements. The Company did not identify any subsequent events that would have required any adjustments or disclosures in the financial statements.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Moringa Acquisition Corp. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to our sponsor, Moringa Sponsor, LP, a Cayman Islands exempted limited partnership, including, where applicable, Moringa Sponsor (US) L.P., a wholly-owned Delaware subsidiary of our sponsor. The following discussion and analysis of the Company’sour financial condition and results of operations should be read in conjunctiontogether with theour unaudited condensed financial statements and therelated notes thereto containedappearing elsewhere in this Quarterly Report, and our audited financial statements and related notes thereto as of, and for the year ended, December 31, 2021, included in the 2021 Annual Report. CertainSome of the information contained in thethis discussion and analysis or set forth belowelsewhere in this Quarterly Report, including information with respect to our plans and strategy for our initial business combination, includes forward-looking statements that involve risks and uncertainties.

Special Note Regarding Forward-Looking Statements

This Quarterly As a result of many factors, including those factors set forth in “Part I, Item 1A. Risk Factors” in the 2021 Annual Report, on Form 10-Q includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act that are not historical facts, and involve risks and uncertainties that could causeour actual results to differ materially from those expected and projected. All statements other than statements of historical fact included in this Form 10-Q including statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discusseddescribed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated inor implied by the forward-looking statements please refer tocontained in the Risk Factors section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 31, 2021. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.report. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.following discussion and analysis.

Overview

We are a blank check company incorporated as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar Business Combinationbusiness combination with one or more businesses. We completed our initial public offering in February 2021, and since that time, we have not, to date, reachedengaged in discussions with potential business combination target companies, and, in June 2022, entered into a bindingbusiness combination agreement with any specific Business Combination target, although we have been engagingHolisto Ltd., as described in discussions and negotiations with one or more potential Business Combination targets.“Recent Developments” below. We intend to effectuate our prospective initial Business Combinationbusiness combination using (i) cash from the proceeds of our initial Public Offeringpublic offering and the Private Placementprivate placements of the private Units,units, (ii) cash from a new financing involving the sale of our shares and/or other equity, and/or (iii) cash from one or more debt or a combination of cash, shares and debt.financings.

The issuance of additional ordinary shares in a Business Combination:business combination (whether by our company or by the target company that will serve as the new public company following a business combination):

Similarly, if we issuethe new public company (following a business combination) issue(s) debt securities itor otherwise incur(s) significant indebtedness in connection with the business combination transaction, that could result in:

WeAs indicated in the accompanying financial statements, at September 30, 2022 we had approximately $202 thousand of cash and cash equivalents and an accumulated deficit of approximately $861 thousand. Although we raised $115 million of gross proceeds, in the aggregate, from our initial public offering in February and March 2021, and an additional $3.8 million of gross proceeds, in the aggregate, from our private placements consummated concurrently with the closings of our initial public offering, we expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete our prospective initial business combination or a Business Combinationrelated capital-raise will be successful.

Recent Developments

On June 9, 2022, we entered into a business combination agreement (the “Business Combination Agreement”), by and among our company, Holisto Ltd., a company organized under the laws of the State of Israel (“Holisto”), and Holisto MergerSub, Inc., a Cayman Islands exempted company and wholly-owned subsidiary of Holisto (“Merger Sub”). The prospective transactions set forth in the Business Combination Agreement (the “Transactions”) will constitute a “Business Combination” as contemplated by our amended and restated memorandum and articles of association. The Business Combination Agreement and the Transactions contemplated thereby have been unanimously approved by the boards of directors of Moringa and Holisto, and by the shareholders of Holisto.

The following description of the Business Combination Agreement does not purport to be complete and is qualified in its entirety by reference to the Business Combination Agreement, a copy of which is included as Exhibit 2.1 to our Current Report on Form 8-K, filed with the Securities and Exchange Commission (the “SEC”) on June 13, 2022. Capitalized terms used in this Form 10-Q and not otherwise defined herein have the meanings assigned to them in the Business Combination Agreement.

Pursuant to the Business Combination Agreement, at the closing (the “Closing”) of the prospective Transactions contemplated thereunder, and following the Capital Restructuring (as each such term is defined and described below): (i) Merger Sub will merge with and into our company, with our company continuing as the surviving entity and a wholly-owned subsidiary of Holisto (the “Merger”); (ii) our units, to the extent not previously separated, will be separated into Class A ordinary shares and warrants; (iii) Class B ordinary shares will be converted into Moringa Class A Ordinary Shares; (iv) the Class A ordinary shares will be converted into ordinary shares of Holisto (“Holisto Ordinary Shares”) in accordance with the ratio described below; (v) each Moringa warrant will be converted into one Holisto warrant (on the same terms contained in the Moringa warrants, except that each Holisto warrant will represent the right to acquire Holisto ordinary shares in lieu of Moringa Class A ordinary shares); (vi) Moringa will become a wholly-owned subsidiary of Holisto; and (vii) Moringa, as a wholly-owned subsidiary of Holisto, will change its corporate name to Holisto Inc. and will amend and restate its amended and restated memorandum and articles of association so as to be appropriate for a private company.

The number of Holisto Ordinary Shares to be received in exchange for each Moringa Class A ordinary share in the prospective Merger will depend on whether the share was issued to the public pursuant to the registration statement relating to Moringa’s initial public offering (a “Moringa Public Share”) or whether the share was issued other than as part of Holisto’s initial public offering:

Prior to the Closing, but subject to the completion of the Closing, Holisto will effect a capital restructuring of its outstanding equity securities (the “Capital Restructuring”) so that the only class of outstanding equity of Holisto will be Holisto Ordinary Shares (along with certain options and warrants to be rolled over in connection with the Transactions). To effect the Capital Restructuring, (i) warrants to purchase Holisto Ordinary Shares, Ordinary A Shares and Preferred Shares (with certain exceptions) will be automatically exercised in accordance with their terms; (ii) each existing Simple Agreement for Future Equity (“SAFE”) that is outstanding for Holisto securities as of the date of the Business Combination Agreement (excluding any New SAFE Agreement, for a total of $4.75 million) will be converted automatically into Holisto Ordinary Shares in accordance with the terms of the SAFE agreements; (iii) the preferred shares and ordinary A shares of Holisto (including preferred shares and ordinary A shares issuable upon exercise of warrants that are exercised as part of the Capital Restructuring) will be converted into Holisto Ordinary Shares in accordance with their terms with the result that only Holisto Ordinary Shares will be outstanding. Holisto will then effect a share split, to become effective immediately prior to the Closing, and subject to the effectiveness of the Merger, pursuant to which each Holisto Ordinary Share outstanding as of immediately prior to the effective time of the Merger (but after the exercises and conversions described above, and excluding and prior to the issuance of any shares pursuant to a New SAFE Agreement) will be converted into the number of Holisto Ordinary Shares computed by (A) multiplying each such Holisto Ordinary Share by (B) the conversion ratio described below (the “Conversion Ratio”); and (iv) with respect to outstanding options and warrants to purchase Holisto Ordinary Shares that are not exercised as part of the Capital Restructuring, the number of Holisto Ordinary Shares issuable upon exercise of those securities, as well as the exercise price of those securities, will be adjusted in accordance with the Conversion Ratio. The Conversion Ratio is based on a Holisto valuation of $400 million plus the amount actually invested pursuant to the New SAFE Agreements, and a share price of $10.00 per Holisto Ordinary Share. The Business Combination Agreement does not provide for any purchase price adjustments to the Conversion Ratio as part of the pre-Closing Capital Restructuring.

Contemporaneously with the execution of the Business Combination Agreement, Holisto, Moringa and an institutional investor (the “Investor”) entered into a securities purchase agreement (the “Securities Purchase Agreement”) pursuant to which Holisto agreed to issue to the Investor and the Investor agreed to purchase from Holisto contemporaneously with the prospective Closing under the Business Combination Agreement, on and subject to the terms and conditions of the Securities Purchase Agreement, for a total consideration of $30 million, Holisto’s secured senior convertible note in a principal amount of $30 million, which was to be due two years from the date of issuance (the “Investor Note”), and a warrant to purchase an aggregate of 1,363,636 Holisto Ordinary Shares (the “Financing Warrant”) at an exercise price of $11.50. The Securities Purchase Agreement was terminated as of September 5, 2022 pursuant to Holisto’s termination right, with no liability on the part of any party, other than Holisto’s obligation to reimburse the Investor in an agreed amount of $305,000 for its legal counsel’s fees, of which $50,000 was paid. The Securities Purchase Agreement, and the termination thereof are described in our Current Reports on Form 8-K, filed with the SEC on June 13, 2022 and September 6, 2022, respectively.

The consummation of the prospective Business Combination is subject to certain conditions as further described in the Business Combination Agreement.

Unless specifically stated, this Form 10-Q does not give effect to the prospective Business Combination and does not contain a description of the risks associated with the prospective Business Combination. Such risks and effects relating to the prospective Business Combination are described in a registration statement on Form F-4, filed by Holisto with the SEC on September 7, 2022. The registration statement on Form F-4 also contains a description of the business, operations, financial condition, management, governance, capitalization and other materials terms related to the combined company following the Business Combination, as well as information regarding the redemption process and the shareholders’ meeting of Moringa at which the Transactions will be brought for approval.

Results of Operations and Known Trends or Future Events

We have not engaged in limitedany revenue-generating operations to date, which have not generated any revenues.date. Our only activities since inception have been organizational activities, activities relatedpreparations for our initial public offering and, subsequent to our initial Public Offeringpublic offering, searching for, and Private Placement, and subsequent preliminary discussions and negotiationsdue diligence related to, potential target companies with one or more potential Business Combination targets. Following our initial Public Offering, wewhich to consummate a business combination transaction. We have not generated any operating revenues and will not do sogenerate any operating revenues until after completion of our initial Business Combination.business combination. We generate non-operating income in the form of interest income on fundsinvestments held in our trust account after our initial Public Offering. Other than the proceeds raised from our initial Public Offering and concurrent Private Placement financings in February-March 2021, therepublic offering. There has been no significant change in our financial or trading position and no material adverse change has occurred since the December 31, 2021 date of our audited financial statements.statements contained in our 2021 Annual Report. After our initial Public Offering,public offering, which was consummated in February and March 2021, we have been incurring increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.expenses related to our search for a target company.

For the three months and nine months ended September 30, 2021,2022, we had net lossesprofit of $223,905$292.5 thousand and $513,452,$89.6 thousand respectively, which were attributable to the following factors:

Liquidity and Capital Resources

PriorWe have incurred and expect to continue to incur significant costs in pursuit of our financing and acquisition plans.

In early 2021, prior to the completion of our initial Public Offering,IPO, our only source of liquidity was an initial purchase of Class B ordinary shares by the Sponsor andneeds were satisfied from the availability of up to $300,000 ofin loans from our Sponsorsponsor under an unsecured promissory note.note, under which we had initially borrowed $150,000 prior to December 31, 2020 and an additional $20,000 in February 2021. The total $170,000 balance owed under the note was repaid in March 2021 following the closings of our initial public offering.

OnAt the time of our IPO in February 19,and March 2021, we consummated our initial Public Offeringraised $116,200,000 of 10,000,000 Units, at a price of $10.00 per Unit, generating gross proceeds of $100,000,000. Simultaneously with the closing of the initial Public Offering, we consummated the sale of 350,000 Units (“Private Units”) in the Private Placement, of which 325,000 Private Units were sold to the Sponsor and 25,000 Private Units were sold to EarlyBirdCapital, Inc. (“EarlyBirdCapital”), at a price of $10.00 per Private Unit, which generated additional gross proceeds of $3,500,000.

On March 3, 2021, as a result of the underwriters’ election to fully exercise their over-allotment option for the initial Public Offering, we consummated the sale of an additional 1,500,000 Units, at $10.00 per Unit, for gross proceeds of $15,000,000. Concurrently with that sale, we sold an additional 30,000 Private Units, of which 27,857 Private Units were sold to the Sponsor and 2,143 Private Units were sold to EarlyBirdCapital, at a price of $10.00 per Private Unit, generating additional gross proceeds of $300,000.

The net proceeds from (i) the sale of units to the Unitspublic in our initial Public Offering,the offering, after deducting offering expenses of $334,456approximately $300,000 and underwriting commissions of $2,300,000 (but excluding an advisory fee of $4,025,000$4,025,000) that have been or will be payable to the representative of the underwriters for services to be performed for us in connection with (and subject to the consummation of) our initial Business Combination transaction),business combination transaction, and (ii) the sale of the Private Unitsprivate units for a purchase price of $3,800,000 were $116,165,544, in the aggregate. Of thisthat $116,200,000 amount, $115,000,000 (including $4,025,000 in potential advisory fees to be payable to the representative of the underwriters for advisory services in connection with our Initial Business Combinationinitial business combination transaction) was deposited into an interest-bearinga non-interest bearing trust account. The funds in the trust account are invested only in specified U.S. government treasury bills or in specified money market funds. The remaining funds were deposited in our ordinary bank account rather than$1.2 million was not placed in the trust account.

On August 9, 2021, we issued a promissory note to the Sponsor, under which we may draw up to $1 million to cover our ongoing operational costs and/or preparations for an initial Business Combination. As of the date of this quarterly report on Form 10-Q, no amounts have been drawn under the promissory note.

Cash used in operating activities

For the nine months ended SeptemberJune 30, 2021, net cash used in operating activities was $1,033,773. That cash use reflected our net loss of $513,452 for the period, as adjusted upwards to reflect cash expenditures that were not included in our net loss, including $450,103 of cash used for prepaid expenses and $110,000 of cash used to decrease a liability to a related party. Our cash used in operating activities reflects reductions to our net loss in order to eliminate non-cash expenses, including $7,106 attributable to the change in fair value of our private placement warrants, and $42,725 attributable to an increase in accounts payable.

Cash provided by financing activities

For the nine months ended September 30, 2021, net cash provided by financing activities was $116,100,851, primarily reflecting the $112,450,841 of net cash proceeds from both closings of our Initial Public Offering, in the aggregate, and $3,800,000 of cash proceeds from both Private Placement closings, in the aggregate, as well as $20,000 that we borrowed from our sponsor under a promissory note that we issued to the sponsor. Those sources of cash from financing activities were offset, in part, by cash used to repay approximately $169,990, in the aggregate, that2022, we had borrowed from our sponsor under the foregoing promissory note.

Outlook

Asapproximately $115.2 million of September 30, 2021, we had $115,004,191 of cash and marketable securitiesinvestments held in thethat trust account, all of which was invested in Goldman Sachs money market funds. We may withdraw interest to pay our income taxes, if any.

We intend to use substantially all of the fundsinvestments held in the trust account (after reduction for payments to redeeming shareholders) including any amounts representing interest earned on the trust account (which interest shall be net of taxes payable)payable, and excluding potential fees to complete a Business Combination.be payable to the underwriters for advisory services in connection with our initial business combination transaction), to fund our post- business combination company. We may withdraw from the trust interest to pay taxes, if any. Our annual income tax obligations depend on the amount of interest and other income earned on the amounts held in the trust account. To the extent thatwe are acquired as part of our share capitalinitial business combination (as is used,the case in whole or in part, as consideration to complete athe prospective Business Combination with Holisto), the remaining proceeds held in the trust account (less any amounts paid out to redeeming shareholders) will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

Subsequent to our initial public offering, our working capital needs were initially satisfied primarily by the $1.2 million available to us initially outside our trust account. Subsequently, in August 2021, our sponsor agreed to make available to us up to $1,000,000, which is evidenced by a promissory note that we issued to our sponsor, and which is repayable upon the earlier of February 19, 2023 (the 24-month, liquidation deadline for our company) or our consummation of our initial business combination. Of the amounts available under that promissory note, we borrowed $300,000 in December 2021, an additional $300,000 in January 2022, $50,000 more in June 2022 and the remaining $350,000 that was available in July 2022. No amounts remain available to us under that note as of the current time.

As of September 30, 2021,2022, we had $114,588$202 thousand of cash deposited in an SVBour bank account held outside of the trust account. We have begun using, and we intend to continue to use thethose funds heldand any additional funding that we receive and that we hold outside of the trust account primarily towards activities related to identifyour prospective Business Combination (or any other business combination). Those activities include, in primary part, structuring, negotiating and evaluate target businesses, performcompleting a business due diligencecombination, securing financing (including commitment fees) for the post-business combination company, paying for administrative and support services, and paying taxes to the extent the interest earned on prospective target businesses, travelthe trust account is not sufficient to pay our taxes. In addition, we use those funds outside of the trust account for payment of legal and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documentsaccounting fees related to regulatory reporting requirements, including Nasdaq and material agreements of prospective target businesses, structure, negotiateother regulatory fees, and complete a Business Combination.funds for working capital to cover miscellaneous expenses and reserves.

Other than as described below, in

In order to fund working capital deficiencies or finance transaction costs in connection with athe prospective Business Combination or any other initial business combination, our Sponsorsponsor or an affiliate of our Sponsor or certain of our officers and directorssponsor may, but are not obligated to, loan us additional funds as may be required. If we complete a Business Combination,our initial business combination, we would repay such loaned amounts. In the event that a Business Combinationour initial business combination does not close, we may use a portion of the working capital held outside of the trust account to repay such loaned amounts, but no proceeds from our trust account would be used for such repayment. Up to $1,500,000 of such loans (including the $1,000,000 of loans committed to by our sponsor under the August 2021 promissory note) may be converted into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private warrants included in the Private Units. No such loans were outstanding as of September 30, 2021 or as(that are part of the date of this Quarterly Report on Form 10-Q.

As of the date of this report, we may also draw up to $1 million (none of which is currently outstanding) under a promissory note that weprivate units) issued to our Sponsor on August 9, 2021 to cover our ongoing operational costs and/or preparations for an initial Business Combination.

sponsor. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor, as we do 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 our trust account.

We believe that we will need to raiseobtain additional funds in order to meetsatisfy our liquidity needs in our pursuit of an initial business combination, as we have exhausted all remaining available amounts under the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination are less than theforegoing $1,000,000 promissory note. Our actual amount necessary to do so, we may have insufficient funds available to operateworking capital needs will depend on when our business priorcombination is consummated.

We cannot assure you that we will be able to our initial Business Combination. Moreover, we may need to obtain additional financing either to complete oursuccessfully consummate the prospective Business Combination or becauseany other initial business combination.

It is likely that we becomewill be obligated to redeem a significant number of our public shares upon completion of our Business Combination, ininitial business combination, which will reduce the funds from the trust that become available to the surviving company of the business combination. In that case, Holisto (or any other company with which we maycombine) will likely need to issue additional securities or incur debt in connection with the business combination. Subject to compliance with applicable securities laws, the surviving public company would only complete such Business Combination.financing simultaneously with the completion of our business combination. In addition, following our initial business combination, if cash on hand is insufficient, the new public company surviving from the business combination may need to obtain additional financing in order to meet its obligations.

If we are unable to complete our initial business combination, we will be forced to cease operations and liquidate our trust account, which liquidation would be less than 12 months after the date of this Quarterly Report. That factor, together with our need for additional funds in order to fund operations until our initial business combination, raise substantial doubt about our ability to continue as a “going concern”. Please see the explanatory paragraph under the heading “Substantial Doubt about the Company’s Ability to Continue as a Going Concern” in the opinion of our independent auditor on our audited financial statements, which appears in Item 15 of our 2021 Annual Report.

Cash provided by operating activities

For the nine months ended September 30, 2022, net cash provided by operating activities was $156.1 thousand. That cash provided by operating activities reflected our net profit of $89.6 thousand for the period, as adjusted to reflect the following matters:

Cash provided by financing activities

For the nine months ended September 30, 2022, net cash provided by financing activities was $700,000, reflecting funds that we borrowed from our sponsor under the promissory note that we had issued to our sponsor.

Off-Balance Sheet Financing Arrangements

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of September 30, 2021.2022. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

Contractual Obligations

Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay the Sponsor a monthly fee of $10,000 for office space, and administrative and support services, provided to the Company. We began incurring those fees on February 19, 2021 and will continue to incur those fees monthly until the earlier of the completion of a Business Combination and the Company’s liquidation.

We engaged EarlyBirdCapital as an advisor in connection with our Business Combinationinitial business combination to assist in holding meetings with our shareholders to discuss the potential Business Combinationbusiness combination and the target business’ attributes, introduce us to potential investors that are interested in purchasing ourthe surviving public company’s securities in connection with our initial Business Combination,business combination, assist in obtaining shareholder approval for the Business Combinationbusiness combination and assist with press releases and public filings in connection with the Business Combination.business combination. We will pay EarlyBirdCapital a cash fee for such services upon the consummation of our initial Business Combinationbusiness combination in an amount equal to 3.5% of the gross proceeds of the Initial Public Offering,IPO, or $4,025,000 (exclusive of any applicable finders’ fees which might become payable).

Critical Accounting PoliciesEstimates

The preparation ofPrivate Warrant Liability

Please refer to Note 6 - Fair Value Measurements to our condensed financial statements and related disclosuresincluded in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following critical accounting policies:

Class A Ordinary Shares Subject to Possible Redemption

The Company accounts for its public Class A ordinary shares, which are subject to possible redemption, in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Class A 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. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’ equity section of the Company’s condensed balance sheets.

Warrant Liability

We accountItem 1 for the private placement warrants—that we sold as partmethod and level 3 inputs used for the measurement of the Private Units concurrently with our initial Public Offering— in accordance with the guidance contained in Accounting Standards Codification 815 (“ASC 815”), “Derivatives and Hedging”, under which the private placement warrants do not meet the criteria for equity treatment and must be recorded as derivative liabilities. Accordingly, we classify the private placement warrants as liabilities at their fair value and adjust those warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until those warrants are exercised or expire, and any change in fair value is recognized in our statement of operations. The fair value of the private placement warrants has been estimated using a Black-Scholes-Merton model.Warrant Liability.

The public warrants that were included inNo sensitivity analysis was provided, as the Units sold as partrange of our initial Public Offering are classified as equity.

Recent Accounting Standards

Management doesreasonably possible inputs would not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effectimpact on our condensed financial statements.statements taken as a whole.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The net proceeds of our initial public offering and the sale of the private units held in the trust account will be invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act that maintain a stable net asset value of $1.00, which invest only in direct U.S. government treasury obligations. Due to the short-term nature of these investments, we believe there will be no associated material exposure to interest rate risk.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officerchief executive officer and Chief Financial Officer,chief financial officer, to allow timely decisions regarding required disclosure.

EvaluationOur management evaluated, with the participation of Disclosure Controlsour chief executive officer and Procedures

As required by Rules 13a-15 and 15d-15 underchief financial officer, the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15 (e) and 15d-15 (e) under the Exchange Act) as of September 30, 2021.2022, pursuant to Rule 13a-15(b) or Rule 15d-15(b) under the Exchange Act. Based upon their evaluation, our Chief Executive Officerchief executive officer and Chief Financial Officerchief financial officer have concluded that our disclosure controls and procedures were not effective as of September 30, 20212022 because of the material weakness in our internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’scompany’s annual or interim financial statements will not be prevented or detected on a timely basis. Specifically, our management has concluded that our control around the interpretation and accounting for certain complex features of our Class A ordinary shares and private placement warrants was not effectively designed or maintained. This material weakness resulted in the restatement of our audited financial statement as of March 3, 2021. Additionally, this material weakness could result in a misstatement of the warrant liability (for our private placement warrants), Class A ordinary shares and related accounts and disclosures that would result in a material misstatement of the financial statements that would not be prevented or detected on a timely basis. We are diligently working to improve our internal control over financial reporting and to thereby remedy this material weakness.

Changes in Internal Control Over Financial Reporting

During the most recently completed fiscal quarter, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.