Filing summary
Issuer and period: The supplied filing is Semper Paratus Acquisition Corporation’s unaudited Form 10-Q for the quarter ended September 30, 2022—not a Tevogen Inc. filing. Semper Paratus was a shell company seeking a business combination and had not begun operations.
Financial position and results
- Revenue: No operating revenue; the company stated it would not generate operating revenue until after a business combination, at the earliest.
- Profit: Net income was $1.61 million for Q3 2022 and $1.79 million for the first nine months of 2022, compared with a $115 loss for Q3 2021 and an $11,414 loss from inception through September 30, 2021. The 2022 profit primarily reflected gains on trust-account investments, not operating activity.
- Expenses and margins: General and administrative expense was $198,832 for Q3 and $740,296 for the nine months. Operating margins are not meaningful because the company had no operations or revenue.
- Cash flow: Net cash used in operating activities was $201,534 for the nine months. Cash outside the trust account was $143,047 at September 30, 2022, down from $344,581 at year-end 2021.
- Trust and liquidity: The trust account held $354.1 million, including approximately $2.2 million of interest income. Working capital was $136,690. Management said it might need additional financing for transaction costs and acknowledged it could not assure financing would be available.
- Debt and obligations: No long-term debt or borrowings under working-capital loans were outstanding. Current liabilities totaled $281,783; the company also recorded $94,250 of private-placement warrant liabilities and $14.7 million of deferred underwriting fees payable only if a business combination is completed.
Material changes and unusual items
- The nine-month result shifted from a small loss in the 2021 inception period to net income in 2022, mainly due to $2.21 million of unrealized gains on trust investments and a $326,250 gain from the change in warrant fair value.
- Redeemable Class A shares increased to $354.1 million from $351.9 million at December 31, 2021, including $2.22 million of accretion to redemption value.
- Trust-account assets were invested substantially in U.S. Treasury securities. Private-placement warrants were measured using Level 3 fair-value inputs.
Outlook, risks, and contingencies
- The company had until February 8, 2023 to complete a business combination. If it failed to do so, it was required to cease operations, redeem public shares, and liquidate. Management said this deadline and the uncertainty of completing a transaction raised substantial doubt about the company’s ability to continue as a going concern.
- No business combination was assured. The company expected to continue incurring costs while identifying and evaluating targets; additional financing might be needed.
- Management said the effects of COVID-19 and Russia’s war in Ukraine and related sanctions were uncertain and not readily determinable.
- Deferred underwriting fees of $14.7 million were contingent on completing a business combination. Public warrants could expire worthless if the company liquidated.
- Management reported effective disclosure controls and no material change in internal control over financial reporting during the quarter. No legal proceedings were reported.
Important facts to verify
- Confirm the intended issuer: this filing identifies Semper Paratus Acquisition Corporation, not Tevogen Inc.
- Verify whether a business combination was completed by the February 8, 2023 deadline and how public shares, warrants, and trust funds were handled.
- Review subsequent filings for changes in liquidity, financing, redemption activity, and the going-concern assessment.
- Distinguish reported net income from operating performance: the company had no operating revenue, and its 2022 income was driven largely by trust-investment and warrant fair-value gains.