UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
For the transition period from _________to __________
Commission File Number
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
(Address of principal executive offices and zip code)
(Registrant’s telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||
| The | ||||
| The | ||||
| The | ||||
| The | ||||
| The |
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.
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 (Section 232.405
of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit such files).
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:
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging growth company |
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
As of May 10, 2024 there were
AIMFINITY INVESTMENT CORP. I
TABLE OF CONTENTS
i
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AIMFINITY INVESTMENT CORP. I
CONSOLIDATED BALANCE SHEETS
(Unaudited)
| MARCH 31, 2024 | DECEMBER 31, 2023 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expenses | ||||||||
| Total current assets | ||||||||
| Cash held in Trust Account | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities, Temporary Equity, and Shareholders’ Deficit | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Payable - related party | ||||||||
| Working Capital Loan - related party | ||||||||
| Extension Loan - related party | ||||||||
| Total Current Liabilities | ||||||||
| Deferred underwriters’ discount | ||||||||
| Total Liabilities | ||||||||
| Commitments and Contingencies | ||||||||
| Ordinary shares subject to possible redemption, | ||||||||
| Shareholders’ Deficit: | ||||||||
| Preference shares, $ | ||||||||
| Class A ordinary shares, $ | ||||||||
| Class B ordinary shares, $ | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Shareholders’ Deficit | ( | ) | ( | ) | ||||
| Total Liabilities, Temporary Equity and Shareholders’ Deficit | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
1
AIMFINITY INVESTMENT CORP. I
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| For the Three Months Ended | For the Three Months Ended | |||||||
| March 31, 2024 | March 31, 2023 | |||||||
| Formation and operating costs | $ | $ | ||||||
| Loss from Operations | ( | ) | ( | ) | ||||
| Other income: | ||||||||
| Interest earned on investment held in Trust Account | ||||||||
| Net Income (Loss) | $ | $ | ||||||
| $ | $ | |||||||
| $ | ( | ) | $ | ( | ) | |||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
2
AIMFINITY INVESTMENT CORP. I
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT
(Unaudited)
| For The Three Months Ended March 31, 2024 | ||||||||||||||||||||||||||||||||||||
| Ordinary Shares | Additional | Total | ||||||||||||||||||||||||||||||||||
| Preference shares | Class A | Class B | Paid-in | Accumulated | Shareholders’ | |||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||||||||
| Balance as of December 31, 2023 | - | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||||
| Extension funds attributable to ordinary shares subject to redemption | - | - | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||
| Accretion of carrying value to redemption value | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Net income | - | - | - | |||||||||||||||||||||||||||||||||
| Balance as of March 31, 2024 | - | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||||
| For The Three Months Ended March 31, 2023 | ||||||||||||||||||||||||||||||||||||
| Ordinary Shares | Additional | Total | ||||||||||||||||||||||||||||||||||
| Preference shares | Class A | Class B | Paid-in | Accumulated | Shareholders’ | |||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||||||||
| Balance as of December 31, 2022 | - | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||||
| Settlement of deferred offering costs | - | - | - | |||||||||||||||||||||||||||||||||
| Accretion of carrying value to redemption value | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Net loss | - | - | - | |||||||||||||||||||||||||||||||||
| Balance as of March 31, 2023 | - | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
3
AIMFINITY INVESTMENT CORP. I
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| For the Three Months Ended | For the Three Months Ended | |||||||
| March 31, 2024 | March 31, 2023 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net income | $ | $ | ||||||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Interest earned on investment held in Trust Account | ( | ) | ( | ) | ||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses | ( | ) | ( | ) | ||||
| Accrued expense | ( | ) | ( | ) | ||||
| Payable - related party | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash Flows from Investing Activities: | ||||||||
| Investment of Cash in Trust Account | ( | ) | ||||||
| Net cash used in investing activities | ( | ) | ||||||
| Cash Flows from Financing Activities: | ||||||||
| Proceeds from extension loan | ||||||||
| Proceeds from working capital loan | ||||||||
| Net cash provided in financing activities | ||||||||
| Net Change in Cash | ( | ) | ( | ) | ||||
| Cash at beginning of period | ||||||||
| Cash at end of period | $ | $ | ||||||
| Supplemental Disclosure of Non-cash Financing Activities | ||||||||
| Extension funds attributable to ordinary shares subject to redemption | $ | $ | ||||||
| Accretion of carrying value to redemption value | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
4
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Note 1 — Organization, Business Operation
Aimfinity Investment Corp. I (the “Company”) is a blank check company incorporated as a Cayman Islands exempted company on July 26, 2021. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization, or similar Business Combination with one or more businesses (the “initial business combination”). The Company has selected December 31 as its fiscal year end.
The Company is an early stage emerging growth company and, as such, the Company is subject to all of the risks associated with early stage emerging growth companies.
As of March 31, 2024, the Company had not commenced any operations. The Company’s only activities from July 26, 2021 (inception) to March 31, 2024 were organizational activities, those necessary to prepare for the IPO, described below, and, after the IPO, identifying a target company for an initial business combination. The Company will not generate any operating revenues until after the completion of an initial 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 (as defined below).
The registration statement for the Company’s Initial Public Offering
(“IPO”) became effective on April 25, 2022. On April 28, 2022 the Company consummated the IPO of
Substantially concurrently with the closing of the IPO, the Company
completed the private sale of
Transaction costs amounted to $
Following the closing of the IPO and the issuance and the sale of Private
Placement Units on April 28, 2022, $
The Company’s initial business combination must occur with one
or more target businesses that together have an aggregate fair market value of at least
The ordinary shares subject to redemption will be recorded at a redemption
value and classified as temporary equity upon the completion of the Initial Public Offering, in accordance with Accounting Standards Codification
(“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” In such case, the Company will proceed with an initial
business combination if the Company has net tangible assets of at least $
5
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Under the Company’s then-effective amended and restated memorandum
and articles of association, the Company would have until July 28, 2023 (or January 28, 2024 if the Company extends the period of time
to consummate an initial business combination) to consummate an initial business combination. On July 27, 2023, the Company held an extraordinary
general meeting of shareholders (the “First EGM”). At the First EGM, the shareholders of the Company, by special resolution,
approved the proposal to amend the Company’s then effective amended and restated memorandum and articles of association (the “First
Charter Amendment”) to (i) allow the Company until July 28, 2023 to consummate an initial business combination, and to (ii) elect
to extend the period to consummate an initial business combination up to nine times, each by an additional one-month period, for a total
of up to nine months to April 28, 2024, by depositing to the Company’s Trust Account the amount lesser of (i) $
On August
29, 2023, in connection with the votes to approve the First Charter
Amendment Proposal, the holders of
For the three months ended March 31, 2024, the total of $
On April 23, 2024, the Company held a second extraordinary general
meeting of shareholders (the “Second EGM”). At the Second EGM, the shareholders of the Company, by special resolution, approved
the proposal (the “New Charter Amendment Proposal”) to amend the Company’s Existing MA to (i) allow the Company until
April 28, 2024 to consummate an initial business combination, and to (ii) elect to extend the period to consummate an initial business
combination up to nine times, each by an additional one-month period (each a “New Monthly Extension”), for a total of up to
nine months to January 28, 2025(the “Combination Deadline”), by depositing to the Company’s Trust Account the amount
lesser of (i) $
If the Company does not consummate an initial business combination
by the Combination Deadline, the Company will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably
possible but no 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 earned on the funds held in the trust account and not previously
released to the Company to pay the franchise and income taxes that were paid by the Company or are payable by the Company, if any (less
up to $
The founder shares are designated as Class B ordinary shares are identical
to the Class A ordinary shares included in the units being sold in the IPO, and holders of founder shares have the same shareholder rights
as public shareholders, except that: (a) the founder Class B ordinary shares will automatically convert into the Company’s Class
A ordinary shares at the time of the initial business combination, (b) the founder shares are subject to certain transfer restrictions,
as described in more detail below; (c) prior to the initial business combination, only holders of the founder shares have the right to
vote on the appointment of directors and holders of a majority of the Company’s founder shares may remove a member of the board
of directors for any reason; (d) in a vote to continue the Company in a jurisdiction outside the Cayman Islands (which requires the approval
of at least two thirds of the votes of all ordinary shares voted at a general meeting), holders of the Company’s founder shares
have ten votes for every founder share and, as a result, the Company’s initial shareholders will be able to approve any such proposal
without the vote of any other shareholder; (e) the Company’s Sponsor and each member of the management team have entered into an
agreement with the Company, pursuant to which they have agreed to (i) waive their redemption rights with respect to their founder shares
(ii) to waive their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to
approve an amendment to the Company’s amended and restated memorandum and articles of association (A) that would modify the substance
or timing of the obligation to provide holders of the Company’s Class A ordinary shares the right to have their shares redeemed
in connection with the initial business combination or to redeem
6
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
The founder shares will automatically convert into Class A ordinary
shares at the time of the initial business combination at a ratio such that the number of Class A ordinary shares issuable upon conversion
of all founder shares will equal, in the aggregate, on an as-converted basis, approximately
The Sponsor, Aimifnity Investment LLC, has agreed that it will be liable
to the Company if and to the extent any claims by a third party (other than the Company’s registered public accounting firm) for
services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into
a transaction agreement, reduce the amounts in the trust account to below the lesser of (i) $
The Merger Agreement
On October 13, 2023, The Company, entered into that certain Agreement and Plan of Merger (as may be amended, supplemented or otherwise modified from time to time, the “Merger Agreement”),by and between the Company, Docter Inc., a Delaware corporation (the “Docter”), Aimfinity Investment Merger Sub I, a Cayman Islands exempted company and wholly-owned subsidiary of the Company (“Purchaser”), and Aimfinity Investment Merger Sub II, Inc., a Delaware corporation and wholly-owned subsidiary of Purchaser (“Merger Sub”), pursuant to which (a) Company will be merged with and into Purchaser (the “Reincorporation Merger”), with Purchaser surviving the Reincorporation Merger, and (b) Merger Sub will be merged with and into the Docter (the “Acquisition Merger”), with Docter surviving the Acquisition Merger as a direct wholly owned subsidiary of Purchaser (collectively, the “Business Combination”). Following consummation of the Business Combination (the “Closing”), Purchaser will be a publicly traded company (Purchaser is sometimes referred to herein as “PubCo”, upon and following the consummation of the Reincorporation Merger).
Going Concern Consideration
As of March 31, 2024, the Company had cash of $
The Company’s cash and working capital as of March 31, 2024, are not sufficient to complete its planned activities to consummate an initial business combination for the upcoming year. In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s (“FASB”) Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that these conditions raise substantial doubt about the Company’s ability to continue as a going concern. In addition, if the Company is unable to complete an initial business combination by the Combination Deadline, the Company’s board of directors would proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company. There is no assurance that the Company’s plans to consummate an initial business combination will be successful by the Combination Deadline. As a result, management has determined that such additional conditions also raise substantial doubt about the Company’s ability to continue as a going concern. The financial statement does not include any adjustments that might result from the outcome of this uncertainty.
7
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Note 2 — Significant Accounting Policies
Basis of Presentation
The accompanying unaudited financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Interim results are not necessarily indicative of results to be expected for any other interim period or for the full year. The information included in this Form 10-Q should be read in conjunction with information included in the Company’s annual report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on April 12, 2024.
Principles of consolidation
The consolidated financial statements include the financial statements of the Company and its wholly owned subsidiaries, Purchaser and Merger Sub, over which the Company exercises control. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.
Emerging Growth Company Status
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 The Company’s Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statement, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b) (1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an 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. This may make comparison of the Company’s financial statement 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.
Use of Estimates
The preparation of financial statement in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statement, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments
with an original maturity of three months or less when purchased to be cash equivalents. The Company had $
8
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Investments held in Trust Account
As of March 31, 2024 and December 31, 2023, the assets held in the Trust Account were held in money market funds, which are invested in U.S. Treasury securities.
The Company classifies its U.S. Treasury and equivalent securities as held-to-maturity in accordance with ASC Topic 320 “Investments — Debt and Equity Securities.” Held-to-maturity securities are those securities which the Company has the ability and intent to hold until maturity. Held-to-maturity treasury securities are recorded at amortized cost on the accompanying balance sheet and adjusted for the amortization or accretion of premiums or discounts.
Deferred Offering Costs
The Company complies with the requirements of FASB ASC Topic 340-10-S99-1, “Other Assets and Deferred Costs – SEC Materials” (“ASC 340-10-S99”) and SEC Staff Accounting Bulletin Topic 5A, “Expenses of Offering”. Deferred offering costs consist of underwriting, legal, accounting and other expenses (including underwriting discounts and commissions) incurred through the balance sheet date that are directly related to the IPO and was charged to shareholder’s equity upon the completion of the IPO on April 28, 2022.
Warrants
The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in FASB ASC 480 “Distinguishing Liabilities from Equity” (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, whether they meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own Ordinary Shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.
For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of equity at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. (See Note 8).
Ordinary Shares Subject to Possible Redemption
The Company accounts for its ordinary shares subject
to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” ordinary
shares subject to mandatory redemption (if any) are classified as a liability instrument and 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 stockholders’ equity. The Company’s Public 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, as of March 31, 2024 and December 31, 2023, ordinary shares subject to possible redemption are presented at redemption value
of $
Net income (loss) Per Ordinary Share
The Company complies with accounting and disclosure requirements of FASB ASC 260, Earnings Per Share. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered the undistributed income (loss) allocable to both the redeemable shares and non-redeemable shares and the undistributed income (loss) is calculated using the total net income (loss) less interest and dividend income and unrealized gain or loss on investments in the Trust Account less any dividends paid. The Company then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable shares. Any remeasurement of the accretion to redemption value of the ordinary shares subject to possible redemption was considered to be dividends paid to the public shareholders. As of March 31, 2024, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then shared in the earnings of the Company. As a result, diluted income (loss) per share is the same as basic income (loss) per share for the period presented.
9
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
| For the Three Months Ended | For the Three Months Ended | |||||||
| March 31, 2024 | March 31, 2023 | |||||||
| Net income | $ | $ | ||||||
| Accretion of carrying value to redemption value | ( | ) | ( | ) | ||||
| Net loss including accretion of carrying value of redemption value | $ | ( | ) | $ | ( | ) | ||
| For the Three Months Ended | For the Three Months Ended | |||||||||||||||
| March 31, 2024 | March 31, 2023 | |||||||||||||||
| Redeemable | Non-Redeemable | Redeemable | Non-Redeemable | |||||||||||||
| Common | Common | Common | Common | |||||||||||||
| Stock | Stock | Stock | Stock | |||||||||||||
| Basic and diluted net loss per share: | ||||||||||||||||
| Numerators: | ||||||||||||||||
| Allocation of net loss including carrying value to redemption value | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Accretion of carrying value to redemption value | ||||||||||||||||
| Allocation of net income/(loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Denominators: | ||||||||||||||||
| Weighted-average shares outstanding | ||||||||||||||||
| $ | $ | ( | ) | $ | $ | ( | ) | |||||||||
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentration
of credit risk consist of a cash account in a financial institution. The Company has not experienced losses on this account and management
believes the Company is not exposed to significant risks on such account. As of March 31, 2024 and December 31, 2023, approximately $
Fair Value of Financial Instruments
ASC Topic 820 “Fair Value Measurements and Disclosures” defines fair value, the methods used to measure fair value and the expanded disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between the buyer and the seller at the measurement date. In determining fair value, the valuation techniques consistent with the market approach, income approach and cost approach shall be used to measure fair value. ASC Topic 820 establishes a fair value hierarchy for inputs, which represent the assumptions used by the buyer and seller in pricing the asset or liability. These inputs are further defined as observable and unobservable inputs. Observable inputs are those that buyer and seller would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs reflect the Company’s assumptions about the inputs that the buyer and seller would use in pricing the asset or liability developed based on the best information available in the circumstances.
10
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
The fair value hierarchy is categorized into three levels based on the inputs as follows:
| ● | Level 1 - Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Valuation adjustments and block discounts are not being applied. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a significant degree of judgment. |
| ● | Level 2 - Valuations based on (i) quoted prices in active markets for similar assets and liabilities, (ii) quoted prices in markets that are not active for identical or similar assets, (iii) inputs other than quoted prices for the assets or liabilities, or (iv) inputs that are derived principally from or corroborated by market through correlation or other means. |
| ● | Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement. |
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.
Income Taxes
The Company accounts for income taxes under ASC 740 Income Taxes (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.
ASC 740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statement and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2024 and December 31, 2023. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
The Company determined that the Cayman Islands is the Company’s only major tax jurisdiction.
The Company may be subject to potential examination by federal and state taxing authorities in the areas of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with federal and state tax laws. The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 3, 2024 and December 31, 2023. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
Recent Accounting Pronouncements
Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statement.
Note 3 — Investment Held in Trust Account
As of March 31, 2024 and December 31, 2023, assets
held in the Trust Account were comprised of $
| Level | March 31, 2024 | December 31, 2023 | |||||||||
| Assets: | |||||||||||
| Trust Account – U.S. Treasury Securities Money Market Fund | 1 | $ | $ | ||||||||
| Total | 1 | $ | $ | ||||||||
11
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Note 4 — Initial Public Offering
Pursuant to the IPO on April 28, 2022, the Company sold
The Class 1 and Class 2 warrants have similar terms, except that the Class 1 Warrants separated and began separately trading on the 52nd day following the effective date of the IPO. The New Units resulting from such separation (each such New Unit consisting of one Class A ordinary share and one-half of one Class 2 Warrant) will not separate into Class A ordinary shares and redeemable warrants until consummation of the initial business combination.
All of the
The Company’s redeemable Class A ordinary shares is subject to SEC and its staff’s guidance on redeemable equity instruments, which has been codified in ASC 480-10-S99. If it is probable that the equity instrument will become redeemable, the Company has the option to either accrete changes in the redemption value over the period from the date of issuance (or from the date that it becomes probable that the instrument will become redeemable, if later) to the earliest redemption date of the instrument or to recognize changes in the redemption value immediately as they occur and adjust the carrying amount of the instrument to equal the redemption value at the end of each reporting period. The Company has elected to recognize the changes immediately. The accretion or remeasurement is treated as a deemed dividend (i.e., a reduction to retained earnings, or in absence of retained earnings, additional paid-in capital).
| Ordinary shares subject to possible redemption, December 31, 2022 | $ | |||
| Less: | ||||
| Redemptions | ( | ) | ||
| Plus: | ||||
| Extension funds attributable to ordinary shares subject to redemption | ||||
| Accretion of carrying value to redemption value | ||||
| Ordinary shares subject to possible redemption, December 31, 2023 | $ | |||
| Plus: | ||||
| Extension funds attributable to ordinary shares subject to redemption | ||||
| Accretion of carrying value to redemption value | ||||
| Ordinary shares subject to possible redemption, March 31, 2024 | $ |
Note 5 — Private Placement
Simultaneously with the closing of the IPO, the Company completed the
private placement of
The Sponsor will be permitted to transfer the Private Placement Units held by them to certain permitted transferees, including the Company’s officers and directors and other persons or entities affiliated with or related to it or them, but the transferees receiving such securities will be subject to the same agreements with respect to such securities as the founders. Otherwise, these Private Placement Units will not, subject to certain limited exceptions, be transferable or saleable until 30 days after the completion of the Company’s Business Combination. The warrants included in the Private Placement Units will not be transferable, assignable or saleable until 30 days after the completion of the Company’s initial business combination (except as described herein). Otherwise, the warrants have terms and provisions that are identical to those of the warrants being sold as part of the Units in the IPO, including as to exercise price, exercisability and exercise period.
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Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Note 6— Related Party Transactions
Founder Shares
On December 4, 2021 the Sponsor acquired
On March 29, 2022, the Sponsor transferred
The fair value of the founder shares on the grant
date was approximately $
As of March 31, 2024, the Company determined that an initial business
combination is not considered probable, and therefore, no stock-based compensation expense has been recognized. Total unrecognized compensation
expense related to unvested founder shares as of March 31, 2024 amounted to approximately $
The founder shares are designated as Class B ordinary shares and will
automatically convert into Class A ordinary shares at the time of the initial business combination at a ratio such that the number of
Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, approximately
With certain limited exceptions, The Company’s Sponsor and each
member of the management team have agreed not to transfer, assign or sell any of their founder shares until the earliest of (A) one year
after the completion of the initial business combination and (B) subsequent to the initial business combination, (x) if the closing price
of the Company’s Class A ordinary shares equals or exceeds $
13
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Extension Loans — Related Party
As of March 31, 2024 and December 31, 2023, a total of $
The Notes bear no interest and are payable in full upon the earlier to occur of (i) the consummation of the Company’s business combination or (ii) the date of expiry of the term of the Company (the “Maturity Date”). The following shall constitute an event of default: (i) a failure to pay the principal within five business days of the Maturity Date; (ii) the commencement of a voluntary or involuntary bankruptcy action, (iii) the breach of the Company’s obligations thereunder; (iv) any cross defaults; (v) an enforcement proceedings against the Company; and (vi) any unlawfulness and invalidity in connection with the performance of the obligations thereunder, in which case the Note may be accelerated.
The payee of the Notes has the right, but not the obligation, to convert
the Promissory Note, in whole or in part, respectively, into private units (the “Private Units”) of the Company, that are
identical to the Private Units issued by the Company in the private placement consummated simultaneously with the Company’s initial
public offering. The number of Private Units to be received by the Sponsor in connection with such conversion shall be an amount determined
by dividing (x) the sum of the outstanding principal amount payable to the Sponsor by (y) $
As of March 31, 2024 and December 31, 2023, the
Company has an outstanding loan balance of $
Payable – Related Party
The Company entered an office lease agreement with Regus. The lease
term is
As of March 31, 2024 and December 31, 2023, the Company had $
Working Capital Loans
On December 8, 2023, the Company issued a promissory note to I-Fa Chang,
as the designee, sole member and manager of the Sponsor, under which I-Fa Chang agreed to loan the Company up to $
14
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Note 7 — Commitments & Contingencies
Risks and Uncertainties
Management continues to evaluate the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these financial statement. The financial statement do not include any adjustments that might result from the outcome of this uncertainty.
Registration Rights
The holders of the founder shares, private placement shares and private placement warrants, including any of those issued upon conversion of working capital loans (and any Class A ordinary shares issuable upon the exercise of the private placement warrants that may be issued upon conversion of working capital loans) will be entitled to registration rights pursuant to a registration and shareholder rights agreement to be signed prior to or on the effective date of this offering. The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company registers such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statement filed after the completion of the initial business combination. However, the registration and shareholder rights agreement provides that the Company will not permit any registration statement filed under the Securities Act to become effective until termination of the applicable lockup period, which occurs (i) in the case of the founder shares, and (ii) in the case of the private placement units and the respective Class A ordinary shares underlying such units, 30 days after the completion of the initial business combination. The Company will bear the expenses incurred in connection with the filing of any such registration statement. In addition, pursuant to the registration and shareholder rights agreement, the Company’s Sponsor, upon and following consummation of an initial business combination, will be entitled to nominate three individuals for appointment to the Company’s board of directors, as long as the Sponsor holds any securities covered by the registration and shareholder rights agreement.
Underwriters Agreement
The underwriters are entitled to underwriting discounts of (i) $
Note 8 — Shareholders’ Deficit
Preference Shares — The
Company is authorized to issue
Class A Ordinary Shares — The
Company is authorized to issue
Class B Ordinary Shares — The Company
is authorized to issue
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Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Public shareholders of record are entitled to one vote for each share
held on all matters to be voted on by shareholders. Except as described below, holders of Class A ordinary shares and holders of Class
B ordinary shares will vote together as a single class on all matters submitted to a vote of the Company’s shareholders except as
required by law. Unless specified in the Company’s effective amended and restated memorandum and articles of association at the
time, or as required by applicable provisions of the Companies Act or applicable stock exchange rules, the affirmative vote of a majority
of the Company’s ordinary shares that are voted is required to approve any such matter voted on by the Company’s shareholders.
Approval of certain actions will require a special resolution under Cayman Islands law, being the affirmative vote of at least two-thirds
of the Company’s ordinary shares that are voted, and pursuant to the amended and restated memorandum and articles of association;
such actions include amending the amended and restated memorandum and articles of association and approving a statutory merger or consolidation
with another company. The Company’s board of directors is divided into three classes, each of which will generally serve for a term
of three years with only one class of directors being appointed in each year. There is no cumulative voting with respect to the appointment
of directors, with the result that the holders of more than
Warrants — Each
whole warrant entitles the registered holder to purchase one Class A ordinary share at a price of $
As of March 31, 2024 and December 31, 2023,
The Company has agreed that as soon as practicable, but in no event later than 20 business days, after the closing of the initial business combination, the Company will use its commercially reasonable efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the warrants, and the Company will use its commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of the initial business combination, and to maintain the effectiveness of such registration statement and a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement; provided that if the Company’s Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at the Company’s option, require holders of public warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, and the Company will use its commercially reasonably efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th business day after the closing of the initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption, and the Company will use its commercially reasonably efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. In such event, each holder would pay the exercise price by surrendering the warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess of the “fair market value” (defined below) less the exercise price of the warrants by (y) the fair market value. The “fair market value” as used in this paragraph means the volume weighted average price of the Class A ordinary shares for the 10 trading days ending on the trading day prior to the date on which the notice of exercise is received by the warrant agent.
16
Aimfinity Investment Corp. I
Notes To Consolidated Financial Statements
Redemption of warrants when the price per Class
A ordinary share equals or exceeds $
| ● | in whole and not in part; |
| ● | at a price of $ |
| ● | upon a minimum of 30 days’ prior written notice of redemption to each warrant holder; and |
| ● | if, and only if, the closing price of the Class A ordinary shares equals or exceeds $ |
In addition, if (x) The Company issue additional Class A ordinary shares
or equity-linked securities for capital raising purposes in connection with the closing of the initial business combination at an issue
price or effective issue price of less than $
Note 9 — Subsequent Events
The Company evaluated subsequent events and transactions that occurred after the balance sheet date through the date when the financial statements were issued. Based on this review, management identified the following subsequent events that are required disclosure in the financial statements.
Promissory Notes
On April 4, 2024, the Company issued a promissory note to I-Fa Chang,
as the designee, sole member and manager of the Sponsor, under which I-Fa Chang agreed to loan the Company up to $
On April 23, 2024, the Company held the Second EGM. At the Second EGM, the shareholders of the Company, by special resolution, approved the New Charter Amendment Proposal to amend the Company’s Existing MA to (i) allow the Company until April 28, 2024 to consummate an initial business combination, and to (ii) elect to extend the period to consummate an initial business combination up to nine times, each by an additional New Monthly Extension, for a total of up to nine months to January 28, 2025, by depositing to the Company’s Trust Account the New Monthly Extension Payment.
On April 26, 2024, an aggregate of $
In connection with the votes to approve the New Charter Amendment
Proposal, the public holders (the “Public Shareholders”) of the Public Shares were afforded with an opportunity to redeem
their Public Shares. As a result,
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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 Aimfinity Investment Corp. I. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to Aimfinity Investment, LLC. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
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 (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended, (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, without limitation, 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 “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and variations thereof 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 the Risk Factors section of the Company’s final prospectus for its initial public offering (the “IPO” described below) filed with the Securities Exchange Commission (the “SEC”) on April 26, 2022 (File No. 333-263874) (the “Prospectus”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. 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.
Overview
We are a blank check company incorporated on July 26, 2021 (inception) as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (the “Initial Business Combination”). We intend to effectuate our Initial Business Combination using cash from the proceeds of our IPO and the sale of our shares, debt or a combination of cash, equity and debt. We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete an Initial Business Combination will be successful.
Our Initial Public Offering
On April 28, 2022, we consummated our IPO of 8,050,000 units, which included 1,050,000 units issued pursuant to the full exercise by the underwriters of their over-allotment option (the “Public Units”), each Public Unit consisting of one Class A ordinary share (the “Class A Ordinary Shares”) of the Company, par value $0.0001 per share (the “Public Shares”), one Class 1 redeemable warrant (the “Class 1 Warrants”) and one-half of one Class 2 redeemable warrant (the “Class 2 Warrants”, together with Class 1 Warrants, the “Warrants”) of the Company (each, a “Public Warrant”), each whole Public Warrant entitling the holder thereof to purchase one Class A ordinary share for $11.50 per share. The Public Units were sold at a price of $10.00 per Unit, and the IPO generated gross proceeds of $80,500,000. Simultaneously with the closing of the IPO, we consummated a private placement (the “Private Placement”) with Aimfinity Investment LLC, our sponsor (the “Sponsor”), of an aggregate of 492,000 units (the “Private Placement Units”) (including 42,000 Private Placement Units purchased pursuant to the full exercise by the underwriters of their over-allotment option) at a price of $10.00 per Private Placement Unit, generating gross proceeds to the Company of $4,920,000. Each Private Placement Unit consists of one Class A ordinary share (the “Private Placement Shares”), one Class 1 Warrant, and one-half of one Class 2 Warrant. The terms and provisions of the warrants in the Private Placement Units (together, the “Private Placement Warrants”) are identical to the Public Warrants, except that, subject to certain limited exceptions, they are subject to transfer restrictions until 30 days following the consummation of the Company’s initial business combination. On April 28, 2022, a total of $82,110,000 of the net proceeds from the IPO and the Private Placement was deposited in a trust account (the “Trust Account”) established for the benefit of the Company’s public shareholders at a U.S. based trust account, with U.S. Bank, National Association, acting as trustee.
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The Class 1 Warrants and Class 2 Warrants have similar terms, except that the Class 1 Warrants separated and began separate trading on June 16, 2022 (the 52nd day following the effective date of the IPO). Holders have the option to continue to hold the Public Units or separate the Class 1 Warrants from the Public Units. Separation of the Class 1 Warrants from the Public Units will result in new units consisting of one Class A ordinary share and one-half of one Class 2 Warrant (the “New Units”). Holders will need to have their brokers contact the Company’s transfer agent in order to separate the Public Units into Class 1 Warrants and New Units consisting of one Class A ordinary share and one-half of one Class 2 Warrant. Additionally, the Public Units and the New Units will automatically separate into their component parts and will not be traded after completion of the initial Business Combination.
Since our IPO, our sole business activity has been identifying, evaluating suitable acquisition transaction candidates and preparing for consummation of an initial business combination. We presently have no revenue and have had losses since inception from incurring formation and operating costs. We have relied upon the sale of our securities and loans from the Sponsor and other parties to fund our operations.
Business Combination with Docter Inc.
On October 13 2023, we entered into that certain Agreement and Plan of Merger (as may be amended, supplemented or otherwise modified from time to time, the “Business Combination Agreement”), by and between us, Docter Inc., a Delaware corporation (the “Target”), Aimfinity Investment Merger Sub I, a Cayman Islands exempted company and a newly formed wholly-owned subsidiary of ours (“Purchaser”), and Aimfinity Investment Merger Sub II, Inc., a Delaware corporation and wholly-owned subsidiary of Purchaser (“Merger Sub”), pursuant to which (a) we will be merged with and into Purchaser (the “Reincorporation Merger”), with Purchaser surviving the Reincorporation Merger, and (b) Merger Sub will be merged with and into the Target (the “Acquisition Merger”), with the Target surviving the Acquisition Merger as a direct wholly owned subsidiary of Purchaser (all transactions contemplated under the Business Combination Agreement, collectively, the “Business Combination”). Following the consummation of the Business Combination (the “Closing”), Purchaser will be a publicly traded company (Purchaser is sometimes referred as “PubCo” upon and following the consummation of the Reincorporation Merger).
At the effective time of the Reincorporation Merger (the “Reincorporation Merger Effective Time”), (i) each of our issued and outstanding unit (the “Units”) will automatically separate into one Class 1 Warrant and one New Unit (the “Separation of the AIMA Units”), (ii) upon Separation of the AIMA Units, each of our issued and outstanding New Unit (except the New Units containing the redeemed Class A Ordinary Share and corresponding forfeited Class 2 Warrant) will automatically separate into one Class A Ordinary Share (together with our Class B ordinary shares, par value $0.0001, the “Ordinary Shares”) and one-half of one Class 2 Warrant, (iii) each of our issued and outstanding Ordinary Share will be converted automatically into one ordinary share of PubCo (each, “PubCo Ordinary Share”), and (iv) each of our issued and outstanding Warrant shall be converted automatically into one redeemable warrant of PubCo, exercisable for one PubCo Ordinary Share at an exercise price of $11.50 (each, “PubCo Warrant”). Each of our issued and outstanding security will automatically be cancelled and cease in existence and trading with respect to our security and converted into applicable security of PubCo except as provided in the Business Combination Agreement or under operation of law.
At the effective time of the Acquisition Merger (the “Effective Time”), which shall take place one business after the Reincorporation Merger Effective Time, by virtue of the Acquisition Merger and without any action on the part of us, PubCo, Merger Sub, the Target or the stockholders of the Target immediately prior to the Effective Time (collectively, the “Pre-Closing Target Stockholders”), each Target stockholder’s shares of common stock of the Target (“Target Shares”) issued and outstanding immediately prior to the Effective Time (except certain excluded shares) will be canceled and automatically converted into the right to receive, without interest, the applicable portion of the Closing Payment Shares (as defined below) as set forth in the Closing Consideration Spreadsheet (as defined in the Business Combination Agreement) on a pro rata basis based on the number of Target Shares held by them as of immediately prior to the Effective Time. “Closing Payment Shares” means 6,000,000 PubCo Ordinary Shares, which are equal or equivalent in value to the sum of $$60,000,000 divided by $10.00 per share.
Up to an additional 2,500,000 PubCo Ordinary Shares may be issued to the Pre-Closing Target Stockholders as contingent post-closing earnout consideration (the “Earnout Shares”). The Earnout Shares will not be issued until as below:
| ● | 1,000,000 Earnout Shares will be issued to each Pre-Closing Target Stockholders on a pro rata basis if and only if PubCo completes sales of at least 30,000 Devices (as defined in the Business Combination Agreement) during fiscal year 2024 as reflected in its audited consolidated annual financial statements for the fiscal year ending December 31, 2024 prepared in accordance with the U.S. GAAP as filed with the SEC; |
| ● | 1,500,000 Earnout Shares will be issued to each Pre-Closing Company Stockholders on a pro rata basis if and only if PubCo completes sales of at least 40,000 Devices during fiscal year 2025 as reflected in its audited consolidated annual financial statements for the fiscal year ending December 31, 2025 prepared in accordance with the U.S. GAAP as filed with the SEC. |
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Recent Development
Second Extraordinary General Meeting
Under the Company’s then-effective second amended and restated memorandum and articles of association (the “Existing MA”), which was approved by the shareholders of the Company in an extraordinary general meeting on July 27, 2023, the Company would have until July 28, 2023 to consummate an Initial Business Combination, but may elect to extend the period to consummate an Initial Business Combination (the “Combination Deadline”) up to nine times, each by an additional one-month period, for a total of up to nine months to April 28, 2024, by depositing to the Company’s Trust Account the amount lesser of (i) $85,000 for each one-month extension (each a “Existing Monthly Extension”) or (ii) $0.04 for each Public Share for each one-month extension (the “Existing Monthly Extension Payment”). Under the Existing MA, a total of 9 one-month extensions were sought by the Company, with a total of $765,000 deposited by the Sponsor or its designee (for nine Existing Monthly Extension Payments) to the Trust Account, extending the Combination Deadline from July 28, 2023 to April 28, 2024.
On April 23, 2024, the Company held a second extraordinary general meeting of shareholders (the “Second EGM”). At the Second EGM, the shareholders of the Company, by special resolution, approved the proposal (the “New Charter Amendment Proposal”) to amend the Company’s Existing MA (with the amendment, the “New MA”) to (i) allow the Company until April 28, 2024 to consummate an initial Business Combination, and to (ii) elect to extend the Combination Deadline up to nine times, each by an additional one-month period, for a total of up to nine months to January 28, 2025, by depositing to the Company’s Trust Account the amount lesser of (i) $60,000 for each one-month extension or (ii) $0.035 for each Public Share for each one-month extension (the “New Monthly Extension Payment”). Under Cayman Islands law, the New MA took effect upon approval of the New Charter Amendment Proposal by the shareholders at the Second EGM. On April 26, 2024, the Company also filed the New MAA with the Registrar of Companies of the Cayman Islands.
Pursuant to the New MA, the Company may, at the request of the Sponsor and by approval of the Company’s board of directors, elect to extend the Combination Deadline up to nine times, each by an additional one-month period (each, a “New Monthly Extension”), for a total of up to nine months to January 28, 2025, by depositing to the Trust Account the New Monthly Extension Payment for each New Monthly Extension sought by the Sponsor or the Company.
In connection with the votes to approve the New Charter Amendment Proposal, the public holders (the “Public Shareholders”) of the Public Shares were afforded with an opportunity to redeem their Public Shares. As a result, 860,884 Public Shares of the Company were tendered for redemption. As of the date of this report on Form 10-Q, all such Public Shares are in the process of redemption and cancellation by our transfer agent, VStock Transfer, LLC, which shall result in a total of 3,604,998 Class A ordinary shares (including 492,000 Class A ordinary shares underlying the Private Placement Units) remaining after the consummation of such process.
Monthly Extensions
Under the Company’s Existing MA, the Company would now have until July 28, 2023 (or such later dates up to April 28, 2024, depending on the numbers of Existing Monthly Extensions the Sponsor or the Company seeks to extend) to consummate an Initial Business Combination.
For each Existing Monthly Extension, an Existing Monthly Extension Payment of $85,000 needs to be deposited into the Trust Account for the public stockholders by the 28th day of each month from July 2023 to March 2024 to lead to an extension of Combination Deadline by each Existing Monthly Extension sought, for a total of up to nine months, from July 28, 2023 to April 28, 2024.
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From July 2023 to March 2024, a total of 9 one-month extensions were sought by the Company, with a total of $765,000 deposited by the Sponsor or its designee (for nine Existing Monthly Extension Payments) to the Trust Account, extending the Combination Deadline from July 28, 2023 to April 28, 2024.
Under the Company’s New MA, the Company would now have until April 28, 2024 (or such later dates up to January 28, 2025, depending on the numbers of New Monthly Extensions the Sponsor or the Company seeks to extend) to consummate an Initial Business Combination.
For each New Monthly Extension, a New Monthly Extension Payment of $60,000 needs to be deposited into the Trust Account for the public stockholders by the 28th day of each month from April 2024 to December 2024 to lead to an extension of Combination Deadline by each New Monthly Extension sought, for a total of up to nine months, from April 28, 2024 to January 28, 2025.
On April 26, 2024, an aggregate of $60,000 was deposited into the Trust Account by I-Fa Chang, manager of our Sponsor, for the Public Shareholders each time, respectively on such dates, resulting in an extension of the Combination Deadline by one New Monthly Extension from April 28, 2024 to May 28, 2024.
For each Existing Monthly Extension and each New Monthly Extension, respectively, on the date such Existing Monthly Extension Payment or such New Monthly Extension Payment, respectively, was deposited to the Company’s Trust Account, we issued an unsecured promissory note to I-Fa Chang to evidence the payments made by him for the deposit of such Existing Monthly Extension Payment (in the amount of $85,000 each time), or New Monthly Extension Payment (in the amount of $60,000), as the case may be (in each case, a “Monthly Extension Note”).
Each of such Monthly Extension Notes have the same terms, except with regard to the amount. Each note bears no interest and is payable in full upon the earlier to occur of (i) the consummation of the Company’s Initial Business Combination or (ii) the date of expiry of the term of the Company (the “Maturity Date”). The following shall constitute an event of default: (i) a failure to pay the principal within five business days of the Maturity Date; (ii) the commencement of a voluntary or involuntary bankruptcy action, (iii) the breach of the Company’s obligations thereunder; (iv) any cross defaults; (v) an enforcement proceedings against the Company; and (vi) any unlawfulness and invalidity in connection with the performance of the obligations thereunder, in which case such Monthly Extension Note may be accelerated.
The payee of each Monthly Extension Note, I-Fa Chang, has the right, but not the obligation, to convert each Monthly Extension Note, in whole or in part, respectively, into Private Placement Units of the Company, that are identical to the Private Placement Units issued by the Company in the Private Placement consummated simultaneously with the Company’s IPO, subject to certain exceptions, as described in the Prospectus, by providing the Company with written notice of the intention to convert at least two business days prior to the closing of the Initial Business Combination. The number of Private Placement Units to be received by I-Fa Chang in connection with such conversion shall be an amount determined by dividing (x) the sum of the outstanding principal amount payable to the Sponsor by (y) $10.00.
The issuance of the Monthly Extension Notes were made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended.
Working Capital Note
The Sponsor or an affiliate of the Sponsor or certain of Aimfinity’s officers and directors may, but are not obligated to, loan Aimfinity funds as may be required. Any such loans would be on an interest-free basis and would be repaid only from funds held outside the trust account or from funds released to Aimfinity upon completion of the I Initial Business Combination. Aimfinity may issue such Working Capital Notes to the Sponsor, officers, directors, of their affiliates, evidencing the terms of such loans.
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On April 4, 2024, the Company issued a promissory note to I-Fa Chang, as the designee, sole member and manager of the Sponsor, under which I-Fa Chang agreed to loan the Company up to $500,000 to be used for a portion of the working capital. This loan is non-interest bearing, unsecured and is due at the earlier of (1) the date on which the Company consummates its initial business combination or (2) the date on which the Company liquidates and dissolves. I-Fa Chang, as the payee, has the right, but not the obligation, to convert the note, in whole or in part, into Private Placement Units of the Company, that are identical to the Private Placement Units issued by the Company in the Private Placement consummated simultaneously with the Company’s IPO, subject to certain exceptions, as described in the Prospectus, by providing the Company with written notice of the intention to convert at least two business days prior to the closing of the Initial Business Combination. The number of Private Placement Units to be received by I-Fa Chang in connection with such conversion shall be an amount determined by dividing (x) the sum of the outstanding principal amount payable to I-Fa Chang by (y) $10.00.
The issuance of the Working Capital Note was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended.
As of the date hereof, $816,437 of working capital has been drawn by the Company and no balance has been repaid as of the date of this Report.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities from July 26, 2021 (inception) to March 31, 2024 were organizational activities, those necessary to prepare for the IPO, described below, and, after the IPO, identifying a target company for an Initial Business Combination. We do not expect to generate any operating revenues until after the completion of our Initial Business Combination. We may generate non-operating income in the form of interest income on marketable securities held in the Trust Account. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with completing an Initial Business Combination.
For the three months ended March 31, 2024, we had a net income of $438,864 which consisted of interest income of $568,384 on investments held in Trust Account which was offset by operating cost of $129,520.
For the three months ended March 31, 2023, we had a net income of $679,539 which consisted of interest income of $828,231 on investments held in Trust Account which was offset by operating cost of $148,692.
Liquidity and Capital Resources
Until the consummation of the IPO, our only source of liquidity was an initial purchase of ordinary shares by the Sponsor and loans from our Sponsor.
Following the closing of the IPO and sale of the Private Placement Units on April 28, 2022, a total of $82,110,000 was placed in the Trust Account, and we had $1,495,650 of cash held outside of the Trust Account, after payment of costs related to the IPO, and available for working capital purposes. In connection with the IPO, we incurred $5,117,607 in transaction costs, consisting of $1,610,000 of underwriting fees, $2,817,500 of deferred underwriting fees and $690,107 of other offering costs.
As of March 31, 2024, $44,618,047 was held in the Trust Account in money market funds, which are invested in U.S. Treasury Securities. We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account, excluding deferred underwriting commissions, to complete our Initial Business Combination. We may withdraw interest from the Trust Account to pay taxes, if any. To the extent that our share capital or debt is used, in whole or in part, as consideration to complete an Initial Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
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Aimfinity intends to use the funds held outside the Trust Account to primarily identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, structure, negotiate and complete an initial business combination.
In order to fund working capital deficiencies or finance transaction costs in connection with an initial business combination, the Sponsor or an affiliate of the Sponsor or certain of Aimfinity’s officers and directors may, but are not obligated to, loan us funds as may be required.
On December 8, 2023, the Company issued a promissory note to I-Fa Chang, as the designee, sole member and manager of the Sponsor, under which I-Fa Chang agreed to loan the Company up to $500,000 to be used for a portion of the working capital. This loan is non-interest bearing, unsecured and is due at the earlier of (1) the date on which the Company consummates its initial business combination or (2) the date on which the Company liquidates and dissolves. I-Fa Chang, as the payee, has the right, but not the obligation, to convert the note, in whole or in part, into Private Placement Units of the Company, that are identical to the Private Placement Units issued by the Company in the Private Placement consummated simultaneously with the Company’s IPO, subject to certain exceptions, as described in the IPO Prospectus, by providing the Company with written notice of the intention to convert at least two business days prior to the closing of the Initial Business Combination. The number of Private Placement Units to be received by I-Fa Chang in connection with such conversion shall be an amount determined by dividing (x) the sum of the outstanding principal amount payable to I-Fa Chang by (y) $10.00.
On April 4, 2024, the Company issued a promissory note to I-Fa Chang, as the designee, sole member and manager of the Sponsor, under which I-Fa Chang agreed to loan the Company up to $500,000 to be used for a portion of the working capital. This loan is non-interest bearing, unsecured and is due at the earlier of (1) the date on which the Company consummates its initial business combination or (2) the date on which the Company liquidates and dissolves. I-Fa Chang, as the payee, has the right, but not the obligation, to convert the note, in whole or in part, into Private Placement Units of the Company, that are identical to the Private Placement Units issued by the Company in the Private Placement consummated simultaneously with the Company’s IPO, subject to certain exceptions, as described in the IPO Prospectus, by providing the Company with written notice of the intention to convert at least two business days prior to the closing of the Initial Business Combination. The number of Private Placement Units to be received by I-Fa Chang in connection with such conversion shall be an amount determined by dividing (x) the sum of the outstanding principal amount payable to I-Fa Chang by (y) $10.00.
As of March 31, 2024, the Company, had $816,437 borrowings under the working capital loans.
As of March 31, 2024 the Company had cash of $3,977 and a working capital deficiency of $2,041,465.
In addition, in order to finance transaction costs in connection with an initial business combination, the Company’s Sponsor or an affiliate of the Sponsor or certain of the Aimfinity’s officers and directors have been provided the Company working capital loans (the “Working Capital Loans”). As of March 31, 2024, there were $816,437 under Working Capital Loans.
In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that these conditions raise substantial doubt about the Company’s ability to continue as a going concern. In addition, if the Company is unable to complete an initial business combination by the Combination Deadline, the Company’s board of directors would proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company. There is no assurance that the Company’s plans to consummate an initial business combination will be successful by the Combination Deadline. As a result, management has determined that such additional conditions also raise substantial doubt about the Company’s ability to continue as a going concern. The financial statement does not include any adjustments that might result from the outcome of this uncertainty.
Off-Balance Sheet Financing Arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of March 31, 2024. 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.
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Contractual Obligations
Registration Rights
The holders of the founder shares, Private Placement Units and Private Warrants, including any of those issued upon conversion of Working Capital Loans (and any Private Placement Units issuable upon the exercise of the Private Warrants that may be issued upon conversion of Working Capital Loans) will be entitled to registration rights pursuant to a registration and shareholder rights agreement signed on April 25, 2022. The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed after the completion of our Initial Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the costs and expenses of filing any such registration statements.
Underwriting Agreement
We granted the underwriters a 45-day option from the date of the IPO to purchase up to 1,050,000 additional Public Units to cover over- allotments, if any, at the IPO price less the underwriting discounts and commissions. The underwriters exercised the over-allotment option in full on April 27, 2022.
The underwriters received a cash underwriting discount of $0.20 per Public Unit, or $1,610,000 in the aggregate and paid at the closing of the IPO. In addition, the underwriters will be entitled to a deferred fee of $0.35 per Public Unit, or approximately $2,817,500 in the aggregate upon the consummation of an initial business combination. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes its initial Business Combination, subject to the terms of the underwriting agreement.
Critical Accounting Policies
The accompanying unaudited financial statements are presented in conformity with GAAP and pursuant to the rules and regulations of the SEC.
Recent Accounting Pronouncements
Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
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 Officer and General Counsel, to allow timely decisions regarding required disclosure.
As required by Rules 13a-15f and 15d-15 under the Exchange Act, our Chief Executive Officer and General Counsel carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2024. Based upon their evaluation, our Chief Executive Officer and General Counsel concluded that our disclosure controls and procedures (as defined in Rules 13a-15 (e) and 15d-15 (e) under the Exchange Act) were not effective.
Changes in Internal Control Over Financial Reporting
During the period covered by this Quarterly Report on Form 10-Q, 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.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
ITEM 1A. RISK FACTORS.
As a smaller reporting company, we are not required to include risk factors in this Report. However, factors that could cause our actual results to differ materially from those in this Quarterly Report are any of the risks described in our Prospectus, our annual report on Form 10-K for the fiscal year ended December 31, 2023 (the “Annual Report”) as filed with the SEC on April 12, 2024, and in a proxy statement/prospectus in connection with the Docter Business Combination on the Form F-4 to be filed with the SEC. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. As of the date of this Quarterly Report, there have been no material changes to the risk factors disclosed in our Prospectus and Annual Report.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS FROM REGISTERED SECURITIES.
On December 4, 2021, the Sponsor acquired 2,875,000 Class B ordinary Shares for an aggregate purchase price of $25,000. The issuance of such founder shares to the Sponsor was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. On March 18, 2022, our Sponsor surrendered to us for cancellation 862,500 Class B ordinary shares for no consideration, resulting in our Sponsor holding an aggregate of 2,012,500 Class B ordinary shares.
On April 28, 2022, we consummated the IPO of 8,050,000 Public Units, inclusive of 1,050,000 Public Units sold to the underwriters upon the underwriters’ election to partially exercise their over-allotment option. The Public Units were sold at a price of $10.00 per Public Unit, generating gross proceeds of $80,500,000. US Tiger Securities, Inc. and EF Hutton, division of Benchmark Investments, LLC acted as the joint book-running managers. The securities sold in the offering were registered under the Securities Act on a registration statement on Form S-1 (File No. 333-263874). The registration statement became effective on April 25, 2022.
Substantially concurrently with the closing of the IPO, the Company completed the private placement of 492,000 Private Placement Units to the Sponsor at a purchase price of $10.00 per Private Placement Unit, generating gross proceeds to the Company of $4,920,000.
The units sold as part of the Private Placement Units are identical to the units sold as part of the Public Units in the IPO, except that the Sponsor has agreed not to transfer, assign or sell any of the Private Placement Units (except to certain permitted transferees) until 30 days after the completion of the Company’s initial Business Combination. The issuance of the Private Placement Units was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
A total of $82,110,000 comprised of $80,850,000 of the proceeds from the IPO, and $3,220,000 of the proceeds from the Private Placement, were placed in a U.S.-based trust account maintained by U.S. Bank, National Association, acting as trustee.
We paid a total of $1,610,000 in underwriting discounts and commissions and $690,107 for other costs and expenses related to the IPO, including the Public Units issued pursuant to the partial exercise of the underwriters’ over-allotment option.
For a description of the use of the proceeds generated in our IPO and the Private Placement, see Part I, Item 2 of this Quarterly Report on Form 10-Q.
On March 17, 2023, the sponsor initiated a distribution of 280,000 founder shares and 492,000 Private Placement Units of the Company held by the Sponsor to Imperii Strategies LLC, Aimfinity Investment & Co., and Yuming Investments LLC, all existing members of the Sponsor at that time, and entered into a repurchase agreement with Xin Wang, Joshua Gordon, James J. Long and Nicholas Torres III, then directors and officers of the Company, to transfer 10,000 founder shares each to the Sponsor, as a result of which, the Sponsor directly held 1,692,500 founder shares as of March 17, 2023. The sale and repurchase of the founder shares and the distributions were made pursuant to an exemption from registration contained in Section 4(a)(2) of the Securities Act.
On January 19, 2024, pursuant to certain membership interest purchase and transfer agreement, Mr. Chang sold 2.954% of the Membership Interests of the Sponsor he held, which entitles the holder to receive distribution of 50,000 founder shares currently held under the Sponsor, to Mr. Chun-Cheng Su, a Taiwanese citizen, for 10,000,000 New Taiwan Dollar (approximately USD 319,000 as of the date thereof). On the same date, pursuant to certain membership interest purchase and transfer agreement, Mr. Chang also sold 5.908% of the Membership Interests of the Sponsor he held, which entitles the holder to receive distribution of 100,000 founder shares currently held under the Sponsor, to Mr. Xuedong (Tony) Tian, our CFO and director, for USD1,243. The sale and repurchase of the membership interests were made pursuant to exemptions from registration contained in Section 4(a)(2) of the Securities Act.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
ITEM 5. OTHER INFORMATION.
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ITEM 6. EXHIBITS
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.
| * | Filed herewith |
| ** | Furnished. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Aimfinity Investment Corp. I | ||
| Date: May 13, 2024 | By: | /s/ I-Fa Chang |
| I-Fa Chang | ||
| Chief Executive Officer | ||
| Aimfinity Investment Corp. I | ||
| Date: May 13, 2024 | By: | /s/ Xuedong (Tony) Tian |
| Xuedong (Tony) Tian | ||
| Chief Financial Officer | ||
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