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Armada Acquisition I(AACI) - 2023 Q2 - Quarterly Report
AACIArmada Acquisition I(AACI)2023-05-14 16:00

Financial Performance - For the three months ended March 31, 2023, the company reported a net loss of 27,143,withformationandoperatingcostsof27,143, with formation and operating costs of 790,735 and stock-based compensation of 27,963,offsetbytrustinterestincomeof27,963, offset by trust interest income of 974,408 [112]. - For the six months ended March 31, 2023, the company achieved a net income of 579,884,drivenbytrustinterestincomeof579,884, driven by trust interest income of 2,264,081, despite formation and operating costs of 1,185,087andstock−basedcompensationof1,185,087 and stock-based compensation of 55,926 [112]. - The company had a net loss of 372,286forthethreemonthsendedMarch31,2022,primarilyduetooperatingcostsof372,286 for the three months ended March 31, 2022, primarily due to operating costs of 384,629 and stock-based compensation of 27,963,partiallyoffsetbytrustinterestincomeof27,963, partially offset by trust interest income of 12,243 [112]. - The company reported a net loss of 2,408,500forthesixmonthsendedMarch31,2022,duetooperatingcostsof2,408,500 for the six months ended March 31, 2022, due to operating costs of 2,367,661 and stock-based compensation of 55,926[113].−ForthesixmonthsendedMarch31,2023,cashusedinoperatingactivitieswas55,926 [113]. - For the six months ended March 31, 2023, cash used in operating activities was 1,195,701, with a net income of 579,884primarilyimpactedbytrustinterestincomeof579,884 primarily impacted by trust interest income of 2,264,081 [121]. Business Combination and Financing - The company entered into a Standby Equity Purchase Agreement allowing Rezolve to issue and sell up to 250millionofordinarysharesduringa36−monthperiodfollowingtheclosingoftheBusinessCombination[99].−TheBusinessCombinationAgreementwithRezolveisvaluedat250 million of ordinary shares during a 36-month period following the closing of the Business Combination [99]. - The Business Combination Agreement with Rezolve is valued at 1,750,000,000, with shareholders of Rezolve receiving shares based on this valuation [102]. - The company extended the deadline to complete a business combination to August 17, 2023, following stockholder approval [95]. - The Business Combination Agreement with Rezolve includes a commitment from investors to purchase 2,050,000 ordinary shares for an aggregate purchase price of 20.5million[137].TrustAccountandCashManagement−Thecompanyremoved20.5 million [137]. Trust Account and Cash Management - The company removed 117,079,879 from its Trust Account to pay holders who elected to redeem their shares at a per share redemption price of approximately 10.19[95].−AsofMarch31,2023,theTrustAccounthasreleased10.19 [95]. - As of March 31, 2023, the Trust Account has released 118,066,020 to the Company for tax obligations and redemptions, with 117,079,879usedforredemptionsataper−sharepriceofapproximately117,079,879 used for redemptions at a per-share price of approximately 10.19 [121]. - The total investment held in the Trust Account as of March 31, 2023, was 36,725,055,primarilyinU.S.TreasuryBillsandmoneymarketfunds[119].−TheCompanyhadcashoutsidetheTrustAccountof36,725,055, primarily in U.S. Treasury Bills and money market funds [119]. - The Company had cash outside the Trust Account of 235,949 available for working capital needs as of March 31, 2023 [116]. - Armada held 150,000,000fromthenetproceedsofitsIPOinaTrustAccount,investedinU.S.governmentsecuritieswithamaturityof185daysorless,indicatingnomaterialexposuretointerestraterisk[140].−TheCompanyexpectstousesubstantiallyallfundsintheTrustAccounttocompleteitsinitialbusinesscombination,withanestimatedannualfranchisetaxobligationof150,000,000 from the net proceeds of its IPO in a Trust Account, invested in U.S. government securities with a maturity of 185 days or less, indicating no material exposure to interest rate risk [140]. - The Company expects to use substantially all funds in the Trust Account to complete its initial business combination, with an estimated annual franchise tax obligation of 200,000 [123]. Costs and Liabilities - The Company incurred 3,537,515inIPO−relatedcosts,including3,537,515 in IPO-related costs, including 1,500,000 in underwriting fees [117]. - The aggregate balance outstanding under all promissory notes was 2,201,754asofMarch31,2023[124].−TheCompanyhasnolong−termdebtorcapitalleaseobligations,onlyanadministrativeagreementtoreimbursethesponsorforservicesnotexceeding2,201,754 as of March 31, 2023 [124]. - The Company has no long-term debt or capital lease obligations, only an administrative agreement to reimburse the sponsor for services not exceeding 10,000 per month [129]. - The company has significant costs in pursuit of acquisition plans, raising substantial doubt about its ability to continue as a going concern if a business combination is not completed by August 17, 2023 [126]. Internal Controls and Risk Factors - As of March 31, 2023, the company's disclosure controls and procedures were deemed ineffective due to a material weakness related to accounting for excise tax liability on redemptions [143]. - There were no changes to the internal control over financial reporting during the fiscal quarter ended March 31, 2023, that materially affected the internal control [144]. - No material changes in risk factors were reported as of the date of the Quarterly Report, which could significantly affect the company's operations or financial condition [146]. Shareholder Matters - The company has the right to increase the number of Rezolve shares under the Incentive Plan by up to 5% per annum starting from 2023, subject to shareholder approval [109].