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Edoc Acquisition (ADOC) - 2022 Q2 - Quarterly Report
ADOCEdoc Acquisition (ADOC)2022-08-01 20:45

Financial Performance - As of June 30, 2022, the company reported a net loss of 1,850,432forthethreemonthsendedJune30,2022,andanetlossof1,850,432 for the three months ended June 30, 2022, and a net loss of 6,414,897 for the six months ended June 30, 2022[145]. - For the six months ended June 30, 2022, cash used in operating activities was 749,295,withanetlossof749,295, with a net loss of 6,414,897[156]. - The company has not generated any operating revenues to date and only incurs expenses related to being a public company and due diligence on potential Business Combination candidates[144]. Trust Account and Cash Position - The company had marketable securities held in the Trust Account amounting to 27,497,878asofJune30,2022[141].−AsofJune30,2022,thecompanyhadcashoutsidetheTrustAccountofonly27,497,878 as of June 30, 2022[141]. - As of June 30, 2022, the company had cash outside the Trust Account of only 4,103 available for working capital needs[155]. - An aggregate of 64,996,857wasreleasedfromtheTrustAccounttopayshareholderswhoelectedtoredeem6,326,758OrdinaryShares[170].−ThefundsintheTrustAccounthavebeenheldonlyinU.S.governmenttreasuryobligationsormoneymarketfunds,butmayneedtobeliquidatedtoavoidbeingdeemedanunregisteredinvestmentcompany[198].BusinessCombinationandFinancing−TheaggregatemergerconsiderationfortheBusinessCombinationwithCalidiBiotherapeutics,Inc.wasinitiallysetat64,996,857 was released from the Trust Account to pay shareholders who elected to redeem 6,326,758 Ordinary Shares[170]. - The funds in the Trust Account have been held only in U.S. government treasury obligations or money market funds, but may need to be liquidated to avoid being deemed an unregistered investment company[198]. Business Combination and Financing - The aggregate merger consideration for the Business Combination with Calidi Biotherapeutics, Inc. was initially set at 400,000,000 but was revised to 380,000,000onMay25,2022[149].−ThecompanyenteredintoaPIPEInvestmentagreementforaggregategrossproceedsofupto380,000,000 on May 25, 2022[149]. - The company entered into a PIPE Investment agreement for aggregate gross proceeds of up to 25,000,000, expected to close concurrently with the Business Combination[150]. - The Company will cease all operations except for liquidation if it cannot raise additional funds and complete a Business Combination by August 12, 2022[159]. - The company may need to raise additional capital through loans or investments to meet its working capital needs[158]. Regulatory and Compliance Issues - The SEC has proposed rules that could impose additional regulatory requirements on SPACs, potentially increasing costs and complicating the completion of initial Business Combinations[188]. - The company may be subject to CFIUS review, which could delay or block the Business Combination if deemed a "foreign person"[203]. Internal Controls and Risks - Management has identified a material weakness in evaluating complex accounting issues and controls over reconciliations during the financial statement close process[178]. - The company has identified a material weakness in its internal control over financial reporting as of June 30, 2022, which could adversely affect investor confidence and business results[193]. - There is substantial doubt about the company's ability to continue as a "going concern" due to potential need for additional financing and the deadline for liquidating the trust account[192]. Market and Competitive Environment - The company faces significant competition in identifying attractive targets for initial Business Combinations, which may increase costs and complicate the process[187]. - The company has raised concerns regarding the impact of inflation and interest rates on the ability to consummate an initial Business Combination[184]. Operational Constraints - The company has no long-term debt or capital lease obligations as of June 30, 2022[163]. - The company has not entered into any off-balance sheet financing arrangements as of June 30, 2022[161]. - The company has a deadline of 24 months from the IPO effective date to complete its initial Business Combination, or it may be forced to liquidate[196].