DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (AS RESTATED)

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (AS RESTATED)

NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (AS RESTATED)

Organization and General

Metal Sky Star Acquisition Corporation (the “Company”) is a blank check company incorporated in the Cayman Islands on May 5, 2021. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (“Business Combination”).

The Company’s efforts in identifying prospective target businesses will not be limited to a particular geographic region. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.

The Company’s sponsor is M-Star Management Corporation, a British Virgin Islands incorporated company (the “Sponsor”). At June 30, 2023, the Company had not yet commenced any operations. All activities through June 30, 2023 relate to the Company’s formation and the initial public offering (“IPO”) and its Business Combination. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the IPO. The Company has selected December 31 as its fiscal year-end.

The Company has up to 22 months from the closing of our initial public offering if we extend the period of time to consummate a business combination to consummate a Business Combination (the “Combination Period”). If the Company fails to consummate a Business Combination within the Combination Period, it will trigger its automatic winding up, liquidation and subsequent dissolution pursuant to the terms of the Company’s amended and restated memorandum and articles of association. As a result, this has the same effect as if the Company had formally gone through a voluntary liquidation procedure under the Companies Law. Accordingly, no vote would be required from the Company’s shareholders to commence such a voluntary winding up, liquidation and subsequent dissolution.

On April 5, 2022, the Company consummated the IPO of 11,500,000 units which includes an additional 1,500,000 units as a result of the underwriter’s fully exercise of the over-allotment, at $10.00 per Unit, generating gross proceeds of $115,000,000, which is described in Note 3.

The Trust Account

As of April 5, 2022, a total of $115,682,250 of the net proceeds from the IPO and the private placement transaction completed with the Sponsor, was deposited in a trust account established for the benefit of the Company’s public shareholders with Wilmington Trust, National Association acting as trustee. On January 26, 2023, Extraordinary General Meeting of shareholders was held to approve the proposal to amend the Company’s amended and restated memorandum and articles of association to extend the date by which the Company has to consummate a business combination twelve (12) times for an additional one (1) month each time from February 5, 2023 to February 5, 2024. In connection with the Extraordinary General Meeting, a total of 5,885,324 ordinary shares were presented for redemption in connection with the Extraordinary General Meeting. As of June 30, 2023, and December 31, 2022, the Company had $59,452,791 and $116,673,481 held in the Wilmington Trust account, respectively.

The funds held in the Trust Account will be invested only in United States government treasury bills, bonds or notes having a maturity of 180 days or less, or in money market funds meeting the applicable conditions under Rule 2a-7 promulgated under the Investment Company Act and that invest solely in United States government treasuries. Except with respect to interest earned on the funds held in the Trust Account that may be released to the Company to pay its income or other tax obligations, the proceeds will not be released from the Trust Account until the earlier of the completion of a Business Combination or the Company’s liquidation.

Merger Agreement

On April 12, 2023, Metal Sky entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Future Dao Group Holding Limited, a Cayman Islands exempted company (the “Future Dao”), and Future Dao League Limited, a Cayman Islands exempted company and wholly owned subsidiary of Future Dao (the “Merger Sub”). Pursuant to the Merger Agreement and subject to the terms and conditions set forth therein, (i) Merger Sub will merge with and into Metal Sky (the “First Merger”), with Metal Sky surviving the First Merger as a wholly owned subsidiary of Future Dao, and (ii) Metal Sky will merge with and into Future Dao (the “Second Merger” and together with the First Merger, the “Mergers”), with Future Dao surviving the Second Merger (the “Second Business Combination”). Immediately prior to the First Effective Time, Future Dao will effect a recapitalization of its equity securities (the “Recapitalization”) including a share split of each outstanding Future Dao Ordinary Share into such number of Future Dao Ordinary Shares, calculated in accordance with the terms of the Merger Agreement, such that, based on a value of $350 million for all of the outstanding Future Dao Ordinary Shares, each Future Dao Ordinary Share will have a value of $10.00 per share after giving effect to such share split (the “Share Split”). The Business Combination has been unanimously approved by the boards of directors of both Metal Sky and Future Dao pursuant to a written resolution. The Business Combination is expected to close prior to the end of 2023.

Liquidity

On April 5, 2022, the Company consummated the IPO of 11,500,000 units (including the exercise of the over-allotment option by the underwriters in the IPO) at $10.00 per unit (the “Public Units’), generating gross proceeds of $115,000,000. Each Unit consists of one ordinary share, one redeemable warrant to purchase one ordinary share (each a “Warrant”, and, collectively, the “Warrants”), and one right to receive one-tenth (1/10) of an ordinary share upon the consummation of a Business Combination.

Simultaneously with the consummation of the IPO, the Company sold to its Sponsor 330,000 units at $10.00 per unit in a private placement, generating total gross proceeds of $3,300,000 which is described in Note 4.

Offering costs amounted to $5,704,741 consisting of $2,300,000 of underwriting fees, $2,875,000 of deferred underwriting fees, and $529,741 of other offering costs. Except for $25,000 of subscription of ordinary shares (as defined in Note 5), the Company received net proceeds of $115,682,250 from the IPO and the private placement.

As of June 30, 2023 and December 31, 2022, the Company had $1,164 and $178,652 of cash held in escrow for use as working capital.

In September 2021, the Company repurchased 1,437,500 of founder shares for $25,000. In September 2021, the Company issued 2,875,000 of founder shares for $25,000 which include an aggregate of up to 375,000 ordinary shares subject to forfeiture by the Sponsor to the extent that the underwriter’s over-allotment is not exercised in full or in part, so that the Sponsor will collectively own 20% of the Company’s issued and outstanding ordinary shares after the IPO. On April 5, 2022, the underwriter exercised the over-allotment option in full, accordingly, no Founder Shares are subject to forfeiture.

Going Concern and Management Liquidity Plan

As of June 30, 2023, the Company had $1,164 in cash and working capital deficit of $1,734,940.

The Company’s liquidity needs up to the closing of the IPO on April 5, 2022 had been satisfied through proceeds from notes payable and advances from related party and from the issuance of common stock.

In order to finance transaction costs in connection with a Business Combination, the Company’s Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, provide the Company with working capital. The Company’s management plans to continue its efforts to complete a Business Combination within the Combination Period after the closing of the Initial Public Offering.

If our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our business combination. Moreover, we may need to obtain other financing either to complete our business combination or because we become obligated to redeem a significant number of our public shares upon consummation of our business combination, in which case we may issue additional securities or incur debt in connection with such business combination. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our business combination.

If we are unable to complete our business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the Trust Account. In addition, following our business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.

We have 22 months from the closing of the Initial Public Offering to consummate a Business Combination. It is uncertain that we will be able to consummate a Business Combination by this time. If a Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution.

In connection with the Company’s assessment of going concern considerations in accordance with the Accounting Standards Codification (the “ASC”) issued by Financial Accounting Standards Board (the “FASB”) 205-40, “Presentation of Financial Statements — Going Concern,” management has determined that mandatory liquidation, should a Business Combination not occur, and potential subsequent dissolution raises substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time, which is considered to be one year from the issuance of the financial statements.

Restatement on Previously Issued Financial Statements

In connection with the preparation of the 10-K for the year ended December 31, 2023, management of the Company identified that cash held in Trust Account (marketable securities held in Trust Account) and deferred underwriting commissions were improperly classified as current assets and current liabilities instead of noncurrent assets and noncurrent liabilities, respectively. In accordance with FASB ASC Topic 210 Balance Sheet, the fund held in the Trust Account should not be classified as current assets as it will be used for other than current operation purposes, and deferred offering commissions should not be classified as current liabilities as it will be settled out of the funds held in the Trust Account, the misclassification resulted in an overstatement of current assets and current liabilities, and an understatement of non-current assets and non-current liabilities as of April 5, 2022, June 30, 2022, September 30, 2022, December 31, 2022, March 31, 2023, June 30, 2023 and September 30, 2023, respectively.

The following table illustrates the impact of the restatement of the cash held in Trust Account (marketable securities held in Trust Account) and deferred underwriting commissions on the Company’s balance sheets as of June 30, 2023 and December 31, 2022:

As of June 30, 2023:	As Previously Reported		Adjustment			As Restated
Current assets:
Marketable securities held in Trust Account	$	59,452,791	$	(59,452,791	)	$	-
Total current assets		59,494,580		(59,452,791	)		41,789
Noncurrent assets:
Marketable securities held in Trust Account		-		59,452,791			59,452,791
Total noncurrent assets		-		59,452,791			59,452,791
Total assets		59,494,580		-			59,494,580
Current liabilities:
Deferred underwriting commissions	$	2,875,000	$	(2,875,000	)	$	-
Total current liabilities		4,651,729		(2,875,000	)		1,776,729
Noncurrent liabilities:
Deferred underwriting commissions		-		2,875,000			2,875,000
Total noncurrent liabilities		-		2,875,000			2,875,000
Total liabilities		4,651,729		-			4,651,729

As of December 31, 2022:	As Previously Reported		Adjustment			As Restated
Current assets:
Marketable securities held in Trust Account	$	116,673,481	$	(116,673,481	)	$	-
Total current assets		116,891,816		(116,673,481	)		218,335
Noncurrent assets:
Marketable securities held in Trust Account		-		116,673,481			116,673,481
Total noncurrent assets		-		116,673,481			116,673,481
Total assets		116,891,816		-			116,891,816
Current liabilities:
Deferred underwriting commissions	$	2,875,000	$	(2,875,000	)	$	-
Total current liabilities		3,021,738		(2,875,000	)		146,738
Noncurrent liabilities:
Deferred underwriting commissions		-		2,875,000			2,875,000
Total noncurrent liabilities		-		2,875,000			2,875,000
Total liabilities		3,021,738		-			3,021,738