Not all that glitters is gold!From the Papaya December 23 accounts "
As of December 31, 2023, the Company had cash of $2,013 and a working capital deficit of $609,268"
I was looking to invest, but I won'tWhat do you think this means?
"SPAC shall have at least $5,000,001 of net tangible assets remaining after giving effect to any redemptions"
My interpretation of it is that the SPAC, must have a minimum of $5m in cash. If ARR management signed the non binding agreement and would have accepted a minimum of $5m in cash as the condition precedent to closing, then the SPAC could not muster the $5m required to close and that's why the transaction was called off.
I also went to Yahoo finance
https://finance.yahoo.com/sec-filing/PPYA/0001410578-24-000372_1894057 and the the Papaya website
https://www.papayagrowth.com/ (not very informative)
My reading of the accounts says that as at December 31, 2023 Papaya investors had redeemed all of their cash, the company doesn't have any funds...
Drill a bit deeper and you find the following notes in the accounts
On December 7, 2023, Papaya Growth Opportunity Corp. I, a Delaware corporation (the “Company”), received a letter (the “Letter”) from the staff at The Nasdaq Global Market (“Nasdaq”) notifying the Company that, for the 30 consecutive trading days prior to the date of the Letter, the Company’s common stock had traded at a value below the minimum $50,000,000 “Market Value of Listed Securities” (“MVLS”) requirement set forth in Nasdaq Listing Rule 5450(b)(2)(A), which is required for continued listing of the Company’s common stock on Nasdaq. The Letter is only a notification of deficiency, not of imminent delisting, and has no current effect on the listing or trading of the Company’s securities on Nasdaq.and the following note
Prior to the completion of the IPO, the Company lacked the liquidity it needed to sustain operations for a reasonable period of time, which is considered to be one year from the issuance date of the financial statements. The Company has since completed its IPO at which time capital in excess of the funds deposited in the Trust Account and/or used to fund offering expenses was released to the Company for general working capital purposes. Accordingly, management has since re-evaluated the Company’s liquidity and financial condition and determined that the Company will need to raise additional capital through loans or additional investments from its Sponsor, stockholders, officers, directors or third parties. The Company’s officers, directors and Sponsor may, but are not obligated to, loan the Company funds, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs and there is no guarantee that the Company will receive such funds. As of December 31, 2023, the Company does not have sufficient working capital and will need to borrow additional funds from its Sponsor in order to fund its operations through one year from the date of this filing.
As of December 31, 2023, the Company had cash of $2,013 and a working capital deficit of $609,268. As of the date of the financial statements, $224,000 has been drawn from the $1.2 million promissory note provided from the Sponsor on February 16, 2024.
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