TruGolf Holdings, Inc. 10-Q

Item 1. Financial Statements Deep Medicine Acquisition Corp. Balance Sheets September 30, 2022 March 31, 2022 (Unaudited) (Audited) Assets Current assets Cash $ 514,673 $ 877,099 Prepaid expenses 179,977 315,306 Cash and marketable securities held in Trust Account 128,428,444 127,760,867 Total current assets 129,123,094 128,953,272 Total assets $ 129,123,094 $ 128,953,272 Liabilities and Stockholders’ (Deficit) Current liabilities Accrued expenses - related party $ 11,000 $ 21,000 Accrued expenses 515,513 15,712 Loan payable - related party 500,000 500,000 Total current liabilities 1,026,513 536,712 Non-current liabilities Deferred underwriting commissions 4,427,500 4,427,500 Total non-current liabilities 4,427,500 4,427,500 Total liabilities 5,454,013 4,964,212 Commitments - Common stock subject to possible redemption, 12,650,000 shares at $ 10.14 and $ 10.10 per share as of September 30, 2022 and March 31, 2022, respectively 128,228,444 127,765,000 Stockholders’ (Deficit) Preferred stock, $ 0.0001 par value, 1,000,000 shares authorized, - 0 - shares issued and outstanding as of September 30, 2022 and March 31, 2022 - - Class A Common stock, $ 0.0001 par value, 100,000,000 shares authorized, 620,700 shares issued and outstanding as of September 30, 2022 and March 31, 2022 (excluding 12,650,000 shares subject to possible redemption) 62 62 Class B Common stock, $ 0.0001 par value, 10,000,000 shares authorized, 3,162,500 shares issued and outstanding as of September 30, 2022 and March 31, 2022 316 316 Common stock value 316 316 Additional paid-in capital - - Accumulated deficits ( 4,559,741 ) ( 3,776,318 ) Total Stockholders’ (Deficit) ( 4,559,363 ) ( 3,775,940 ) Total Liabilities and Stockholders’ (Deficit) $ 129,123,094 $ 128,953,272 The accompanying notes are an integral part of unaudited financial statement 2 DEEP MEDICINE ACQUISITION CORP. Statements of Operations For the Three Months Ended September 30, 2022 For the Three Months Ended September 30, 2021 For the Six Months Ended September 30, 2022 For the Six Months Ended September 30, 2021 (Unaudited) (Unaudited) (Unaudited) (Unaudited) Operating expense Officers compensation $ 15,000 $ 15,000 $ 30,000 $ 30,000 General and administrative expenses 702,723 63,774 957,556 65,273 Total operating expense 717,723 78,774 987,556 95,273 Other income Investment income earned on investments held in Trust Account 552,164 - 667,577 - Total other income 552,164 - 667,577 - Net (loss) before income tax ( 165,559 ) ( 78,774 ) ( 319,979 ) ( 95,273 ) Income tax - - - - Net income (loss) ( 165,559 ) ( 78,774 ) ( 319,979 ) ( 95,273 ) Net (loss) per share Basic and diluted - Class A $ ( 0.01 ) $ - $ ( 0.02 ) - Basic and diluted - Class B $ ( 0.01 ) $ ( 0.02 ) $ ( 0.02 ) $ ( 0.03 ) Basic and diluted - Class A & B $ ( 0.01 ) $ ( 0.02 ) $ ( 0.02 ) $ ( 0.03 ) Weighted average number of shares Basic and diluted - Class A 13,270,700 - 13,270,700 - Basic and diluted - Class B 3,162,500 3,162,500 3,162,500 3,162,500 Basic and diluted - Class A & B 3,162,500 3,162,500 3,162,500 3,162,500 The accompanying notes are an integral part of unaudited financial statement 3 Deep Medicine Acquisition Corp. Statement of Changes in Stockholders’ (Deficit) Preferred Stock Class A Common Stock Class B Common Stock Additional Paid-in Accumulated Shares Amount Shares Amount Shares Amount Capital Deficits Total Balance, March 31, 2021 (audited) - $ - - $ - 3,162,500 $ 316 $ 49,684 $ ( 59,395 ) $ ( 9,395 ) Net (loss) - - - - - - - ( 16,499 ) ( 16,499 ) Balance, June 30, 2021 (unaudited) - $ - - $ - 3,162,500 $ 316 $ 49,684 $ ( 75,894 ) $ ( 25,894 ) Net (loss) - - - - - - - ( 78,774 ) ( 78,774 ) Balance, September 30, 2021 - $ - - $ - 3,162,500 $ 316 $ 49,684 $ ( 154,668 ) $ ( 104,668 ) Balance, March 31, 2022 (audited) - $ - 620,700 $ 62 3,162,500 $ 316 $ - $ ( 3,776,318 ) $ ( 3,775,940 ) Net (loss) - - - - - - - ( 154,420 ) ( 154,420 ) Balance, June 30, 2022 (unaudited) - $ - 620,700 $ 62 3,162,500 $ 316 $ - $ ( 3,930,738 ) $ ( 3,930,360 ) Accretion for Class A common stock to redemption amount - - - - - - ( 463,444 ) ( 463,444 ) Net (loss) - - - - - - - ( 165,559 ) ( 165,559 ) Balance, September 30, 2022 - $ - 620,700 $ 62 3,162,500 $ 316 $ - $ ( 4,559,741 ) $ ( 4,559,363 ) The accompanying notes are an integral part of unaudited financial statement 4 Deep Medicine Acquisition Corp. Statements of Cash Flows For the Six Months Ended September 30, 2022 For the Six Months Ended September 30, 2021 (Unaudited) (Unaudited) Cash flows from operating activities: Net (loss) $ ( 319,979 ) $ ( 95,273 ) Adjustments to reconcile net income to net cash provided by (used in) operating activities: Investment income earned on investments held in Trust Account ( 667,577 ) - Changes in operating assets and liabilities: Prepaid expenses 135,329 ( 37,500 ) Accrued expenses 499,801 ( 823 ) Accrued expenses - related parties ( 10,000 ) ( 40,000 ) Net cash (used in) operating activities ( 362,426 ) ( 173,596 ) Cash flows from financing activities: Due to related party - ( 100 ) Net cash (used in) financing activities - ( 100 ) Net increase/(decrease) in cash and cash equivalents ( 362,426 ) ( 173,696 ) Cash and cash equivalents at the beginning of the period 877,099 500,067 Cash and cash equivalents at the end of the period $ 514,673 $ 326,371 SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for interest $ - $ - Cash paid for income taxes $ - $ - NON-CASH TRANSACTIONS: Additional shares issued to sponsor due to upsize of IPO $ - $ 28 Remeasurement for Class A common stock subject to possible redemption $ 463,444 $ - The accompanying notes are an integral part of unaudited financial statement 5 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS Note 1 - Basis of Presentation The accompanying unaudited financial statements of Deep Medicine Acquisition Corp. (the “Company”) have been prepared in accordance with the generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the applicable rules and regulations for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited financial statements should be read in conjunction with the Annual Report on Form 10-K for the year ended March 31, 2022. The interim results for the three and six months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending March 31, 2023 or for any future interim periods. Note 2 - Organization and Description of Business Operations The Company is a blank check company incorporated on July 8, 2020, under the laws of the State of Delaware for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses or entities (a “Business Combination”). While the Company may, subject to certain limitations, pursue a Business Combination target with operations or prospects in the digital healthcare and AI in medicine sector in the global market. As of September 30, 2022, the Company had not commenced any operations. All activity for the period from July 8, 2020 (inception) through September 30, 2022, relates to the Company’s formation and its initial public offering (“IPO”), which is described below, and subsequent to IPO, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the cash and marketable securities held in the Trust Account (as defined below). The Company has selected March 31 as its fiscal year end. On October 29, 2021, the Company consummated its IPO of 12,650,000 units (the “Units” and, with respect to the shares of Class A common stock included in the Units, the “Public Shares”) at $ 10.00 per unit, which included 1,650,000 Units issued pursuant to the full exercise by the Underwriters (as defined below) of their over-allotment option, and the private sale of an aggregate of 519,500 Units (the “Private Placement Units” and with respect to the shares of Class A common stock included in the Units, the “Private Placement Shares”) to its sponsor, Bright Vision Sponsor LLC (the “Sponsor”) and I-Bankers Securities, Inc. (“I-Bankers”) at a purchase price of $ 10.00 per Private Placement Unit, generating gross proceeds of $ 5,195,000 to the Company that closed simultaneously with the closing of the IPO. The Company’s securities have been listed on the Nasdaq Global Market (“Nasdaq”). On December 2, 2021, the Company’s Units no longer traded, and shares of the Company’s Class A common stock and rights underlying the Units commenced trading separately. Transaction costs amounted to $ 7,282,500 consisting of $ 2,530,000 in cash of underwriting commissions, $ 4,427,500 of business combination marketing fee, and $ 325,000 of other offering costs. Upon the closing of the IPO on October 29, 2021, the Company deposited $ 127,765,000 ($ 10.10 per Unit) from the proceeds of the IPO and certain proceeds of the sales of Private Placement Units in the trust account (“Trust Account”), located in the United States and invested only in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting certain conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the funds held in the Trust Account, as described below. 6 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS Following the closing of the IPO, cash of $ 764,101 was held outside of the Trust Account (as defined below) and is available for working capital purposes. As of September 30, 2022, the Company had available cash of $ 514,673 on its balance sheet and a working capital deficit of $ 331,863 . The Company’s management has broad discretion with respect to the specific application of the net proceeds of the IPO and the sale of the Private Placement Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. On July 12, 2022, the Company entered into a definitive Business Combination Agreement (the “Business Combination Agreement”) with Chijet Inc. (together with its subsidiaries, “Chijet”), each of the referenced holders of Chijet’s outstanding shares (collectively, the “ Sellers”), Chijet Motor Company, Inc., a wholly-owned subsidiary of Chijet (“Pubco”), and Chijet Motor (USA) Company, Inc., a wholly-owned subsidiary of Pubco (“Merger Sub”). Chijet indirectly holds an over 85 % interest in Shandong Baoya New Energy Vehicle Co., Ltd., a Chinese company (“Baoya”), which is a producer and manufacturer of electric vehicles. In addition, Chijet indirectly holds an over 64 % interest in FAW Jilin Automobile Co., Ltd., a Chinese company (“FAW Jilin”), which manufactures and sells traditional fuel vehicles. On September 6, 2022, the Business Combination Agreement was amended to extend the due diligence period until and ended on September 20, 2022, which was subsequently extended to September 30, 2022 pursuant to the second amendment of the Business Combination Agreement, dated September 16, 2022. On September 26, 2022, the Company terminated the Business Combination Agreement and the Company is not obligated to pay any penalties pursuant to the terms of the Business Combination Agreement as a result of the termination . The Company must complete a Business Combination with one or more operating businesses or assets that together have an aggregate fair market value equal to at least 80 % of the net assets held in the Trust Account (net of amounts disbursed to management for working capital purposes, if permitted, and excluding the amount of any deferred underwriting commissions) at the time of the Company’s signing a definitive agreement in connection with its initial Business Combination. The Company will only complete a Business Combination if the post-transaction company owns or acquires 50 % or more of the outstanding voting securities of the target or otherwise acquires an interest in the target business or assets sufficient for it not to be required to register as an investment company under the Investment Company Act. The Company will provide its stockholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company. The stockholders will be entitled to redeem their shares for a pro rata portion of the amount held in the Trust Account (initially $ 10.10 per share), calculated as of two business days prior to the completion of a Business Combination, including any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations. The shares of Class A common stock will be recorded at redemption value and classified as temporary equity upon the completion of the IPO, in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 upon such completion of a Business Combination and, if the Company seeks stockholder approval, a majority of the outstanding shares voted are voted in favor of the Business Combination . If the Company seeks stockholder approval in connection with a Business Combination, the Sponsor has agreed to (i) waive its redemption rights with respect to their Private Placement Shares in connection with the completion of the Business Combination, (ii) waive its redemption rights with respect to their Private Placement Shares in connection with a stockholder vote to approve an amendment to the Company’s second amended and restated certificate of incorporation (a) to modify the substance or timing of the Company’s obligation to redeem 100% of the Public Shares if the Company does not complete the Business Combination within the Combination Period (as defined below) or (b) with respect to any other provision relating to stockholders’ rights or pre-initial Business Combination activity and (iii) waive its rights to liquidating distributions from the Trust Account with respect to their Private Placement Shares if the Company fails to complete the Business Combination within the Combination Period. In addition, the Sponsor has agreed to vote any share it held in favor of the Business Combination. Additionally, each public stockholder may elect to redeem its Public Shares, without voting, and if they do vote, irrespective of whether they vote for or against a proposed Business Combination. 7 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS Notwithstanding the foregoing, if the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Company’s second amended and restated certificate of incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15 % of the Public Shares without the Company’s prior written consent. The Company initially had until October 29, 2022 (or April 29, 2023 if the Company may extend the period of time to consummate a Business Combination)(the “Combination Period”) to complete a Business Combination. On October 19, 2022, an aggregate of $ 1,265,000 was deposited into the Company’s trust account to extend the Company’s time to consummate a business combination from October 29, 2022 to January 29, 2023, which amount will be included in the pro rata amount distributed to (i) all of the holders of the Class A common stock sold in the Company’s IPO (“Public Shares”) upon the Company’s liquidation or (ii) holders of Public Shares who elect to have their shares redeemed in connection with the consummation of the Company’s initial business combination. If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than 10 business days thereafter, redeem 100 % of the outstanding 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 (less up to $ 50,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares (as defined below) and Private Placement Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor acquires Public Shares in or after the IPO, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their business combination marketing fees (see Note 9) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such event, such amounts will be included with the funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the IPO price per Unit ($ 10.10 ). The Sponsor has agreed that it will be liable to the Company, if and to the extent any claims by a third party for services rendered or products sold to the Company, or by a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (1) $ 10.10 per Public Share or (2) such lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account nor will it apply to any claims under the Company’s indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (other than the Company’s independent auditors), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. Underwriting Agreement and Business Combination Marketing Agreement The Company engaged I-Bankers as the representative of the underwriters (the “Underwriters”) in the IPO of the Company’s Class A common stock, par value of $ 0.0001 per share (“Shares”), for $ 110 million and the simultaneous listing on Nasdaq. Pursuant to that certain underwriting agreement, I-Bankers acted as the representative of the Underwriters of the IPO for 11,000,000 Units at $ 10.00 per Unit, plus an over-allotment option equal to 15 % of the number of Units offered, or 1,650,000 Units, which was exercised in full simultaneously upon the closing of the IPO. The Company paid I-Bankers underwriters’ commission of $ 2,530,000 , equal to 2.0% of the gross proceeds raised in the IPO for such services upon the consummation of the IPO (exclusive of any applicable finders’ fees which might become payable). 8 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS Upon the closing of the IPO, the Company issued to I-Bankers a five-year warrant to purchase 632,500 Shares of Class A common stock, equal to 5.0 % of the Shares issued in the IPO (“Representative Warrants”). The exercise price of Representative Warrants is $ 12.00 per Share. In addition, I-Bankers was issued 101,200 shares of Class A common stock upon the consummation of IPO (“Representative Shares”). In addition, under a business combination marketing agreement, the Company has engaged I-Bankers as an advisor in connection with the Business Combination and will pay I-Bankers a cash fee for such marketing services upon the consummation of the Business Combination in an amount equal to, in the aggregate, 3.5% of the gross proceeds of the IPO, including any proceeds from the exercise of the underwriters’ over-allotment option . The fee will become payable to the Underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement. Liquidity and Capital Resources The Company has principally financed its operations from inception using proceeds from the sale of its equity securities to its stockholders prior to the IPO, proceeds from related party loan and such amount of proceeds from the IPO that were placed in an account outside of the Trust Account for working capital purposes. Until the consummation of a Business Combination, the Company will be using the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to acquire, and structuring, negotiating and consummating the Business Combination. As of September 30, 2022 and March 31, 2022, the Company had a loan payable to the Sponsor in amount of $ 500,000 with zero interest (the “Loan”). Pursuant to the promissory note between the Company and the Sponsor, the Loan is unsecured, and the Sponsor agrees to fund the Company in amount of up to $ 500,000 . Under no circumstances shall any individual, including but not limited to any officer, director, employee or stockholder of the Company, be obligated personally for any obligations or liabilities of the Loan. These amounts will be repaid upon completion of an initial Business Combination. The Company may 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 (other than as described above), loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. 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 this financial statement. The financial statement does not include any adjustments that might result from the outcome of this uncertainty. Going Concern and Management’s Plan The Company expects to incur significant costs in pursuit of its acquisition plans and will not generate any operating revenues until after the completion of its initial business combination. In addition, the Company expects to have negative cash flows from operations as it pursues an initial business combination target. In connection with the Company’s assessment of going concern considerations in accordance with FASB Accounting Standards Update (“ASU”) Topic 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern” the Company does not currently have adequate liquidity to sustain operations, which consist solely of pursuing a Business Combination. 9 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS The Company may raise additional capital through loans or additional investments from the Sponsor or its stockholders, officers, directors, or third parties. The Company’s officers and directors and the Sponsor may, but are not obligated to (except as described above), loan the Company funds, from time to time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. Based on the foregoing, the Company believes it will have sufficient cash to meet its needs through the earlier of consummation of a Business Combination or the deadline to complete a Business Combination pursuant to the Company’s Amended and Restated Certificate of Incorporation (unless otherwise amended by stockholders). While the Company expects to have sufficient access to additional sources of capital if necessary, there is no current commitment on the part of any financing source to provide additional capital and no assurances can be provided that such additional capital will ultimately be available. These conditions raise substantial doubt about the Company’s ability to continue as a going concern until the consummation of a Business Combination or for a period of time within one year after the date that these unaudited financial statements are issued. There is no assurance that the Company’s plans to raise additional capital (to the extent ultimately necessary) or to consummate a Business Combination will be successful or successful within the Combination Period. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. As is customary for a special purpose acquisition company, if the Company is not able to consummate a Business Combination during the Combination Period, it will cease all operations and redeem the Public Shares. Management plans to continue its efforts to consummate a Business Combination during the Combination Period. Note 3 - Recent Accounting Pronouncements In August 2020, the FASB issued FASB ASU Topic 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements. Management does not believe that any other recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements. Note 4 - Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash equivalents are carried at cost, which approximates fair value. The Company had $ 514,673 and $ 877,099 in cash as of September 30, 2022 and March 31, 2022, respectively, and no cash equivalent as of September 30, 2022 and March 31, 2022. Note 5 - Marketable Securities Held in Trust Account At September 30, 2022, substantially all of the assets held in the Trust Account were held in money market funds, which are invested primarily in U.S. Treasury securities. The Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. As of September 30, 2022 and March 31, 2022, the marketable securities held in the Trust Account were $ 128,428,444 and $ 127,760,867 , respectively. 10 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS Note 6 - Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable common stock (including common stock 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, common stock are classified as stockholders’ equity. The Company’s common stock feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, common stock subject to possible redemption are presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheet. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Immediately upon the closing of the IPO, the Company recognized the remeasurement from initial book value to redemption value. The change in the carrying value of redeemable common stock resulted in charges against additional paid-in capital and accumulated deficit. At September 30, 2022, the common stock subject to redemption reflected in the balance sheet are reconciled in the following table: Schedule of Common Stock Subject to Redemption Gross proceeds $ 126,500,000 Less: Common stock issuance costs ( 2,855,000 ) Plus: Remeasurement of carrying value to redemption value 4,120,000 Common stock subject to possible redemption, March 31, 2022 $ 127,765,000 Plus: Remeasurement of carrying value to redemption value 463,444 Common stock subject to possible redemption, September 30, 2022 $ 128,228,444 Note 7 - Net Loss per Share of Common Stock The Company complies with accounting and disclosure requirements FASB ASC Topic 260, “Earnings per Share”. Net loss per share of common stock is computed by dividing net loss by the weighted average number of shares of common stock issued and outstanding for the period, excluding shares of common stock subject to forfeiture. During the three and six months ended September 30, 2022 and 2021, the Company did no t have any dilutive securities and other contracts that could, potentially, be exercised or converted into shares of common stock and then share in the earnings (loss) of the Company. As a result, diluted loss per share of common stock is the same as basic loss per share of common stock for the period. Schedule of Diluted Loss Per Share of Common Stock For the Three Months Ended September 30, 2022 For the Three Months Ended September 30, 2021 Numerator: Net loss $ ( 165,559 ) $ ( 78,774 ) Denominator: Basic and diluted loss per share – Class A $ ( 0.01 ) — Basic and diluted loss per share – Class B $ ( 0.01 ) $ ( 0.02 ) Denominator for basic and diluted earnings per share – Weighted-average shares of Class A common stock issued and outstanding during the period 13,270,700 — Denominator for basic and diluted earnings per share -– Weighted-average shares of Class B common stock issued and outstanding during the period 3,162,500 3,162,500 11 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS For the Six Months Ended September 30, 2022 For the Six Months Ended September 30, 2021 Numerator: Net loss $ ( 319,979 ) $ ( 95,273 ) Denominator: Basic and diluted loss per share – Class A $ ( 0.02 ) — Basic and diluted loss per share – Class B $ ( 0.02 ) $ ( 0.03 ) Basic and diluted loss per share $ ( 0.02 ) $ ( 0.03 ) Denominator for basic and diluted earnings per share – Weighted-average shares of Class A common stock issued and outstanding during the period 13,270,700 — Denominator for basic and diluted earnings per share -– Weighted-average shares of Class B common stock issued and outstanding during the period 3,162,500 3,162,500 Denominator for basic and diluted earnings per share -– Weighted-average shares of issued and outstanding during the period 3,162,500 3,162,500 Note 8 - Related Party Transactions Accrued Expenses - Related Parties As of September 30, 2022 and March 31, 2022, the Company had accrued expenses – related parties in amount of $ 11,000 and $ 21,000 , respectively, of which $ 6,000 was in connection with the accrued non-cash compensation to the Company’s management and directors. Pursuant to the executed Offer Letters, the Company agreed to pay the Company’s Chief Financial Officer $ 5,000 in cash per month starting from August 1, 2020, and the Company’s officers and directors an aggregate of 300,000 post Business Combination shares within 10 days following a Business Combination, with the same lock-up restrictions and registration rights as the Founder Shares. The fair value of this stock issuance was determined by the fair value of the Company’s Common Stock on the grant date, at a price of $ 0.02 per share. As of September 30, 2022 and March 31, 2022, the accrued expenses related to the cash compensation to the Company’s Chief Financial Officer was $ 5,000 and $ 15,000 , respectively. Loan Payable – Related Party As of September 30, 2022 and March 31, 2022, the Company had a loan payable to the Sponsor in amount of $ 500,000 with zero interest (the “Loan”). Pursuant to the promissory note between the Company and the Sponsor, the Loan is unsecured, and the Sponsor agrees to fund the Company in amount of up to $ 500,000 . Under no circumstances shall any individual, including but not limited to any officer, director, employee or stockholder of the Company, be obligated personally for any obligations or liabilities of the Loan. The proceeds of the Loan were used to pay a portion of the offering expenses of the IPO. These amounts will be repaid upon completion of an initial Business Combination. Working Capital Loans In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or certain of the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $ 1.5 million of such Working Capital Loans may be convertible into private placement-equivalent units at a price of $ 10.00 per unit at the option of the lender. Such units would be identical to the Private Placement Units. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. As of September 30, 2022 and March 31, 2022, no Working Capital Loans were outstanding. 12 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS Note 9 - Commitments and Contingency Registration Rights The holders of the Founder Shares, Private Placement Units (and their underlying securities), the Representative Shares, the Representative Warrants (and their underlying securities), the 300,000 shares of Class A common stock issuable to the Company’s directors and officers within 10 days following the Business Combination and any Units that may be issued upon conversion of the Working Capital Loans (and their underlying securities) will be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of the IPO requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). 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 subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The registration rights agreement does not contain liquidated damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Underwriting Agreement The Company had granted the Underwriters a 30-day option from the date of IPO to purchase up to 1,650,000 additional Units to cover over-allotments, if any, at the IPO price less the underwriting discounts and commissions. Simultaneously upon the closing of the IPO, the Underwriters exercised the over-allotment option in full. As such, the Underwriters were paid an underwriting discount and commission of $ 0.20 per Unit, or $ 2,530,000 in the aggregate payable upon the closing of the IPO, and I-Bankers was entitled to a business combination marketing fee of $ 4,427,500 in the aggregate, which is held in the Trust Account and payable upon completion of the Business Combination. Note 10 - Stockholders’ Equity The Company is authorized to issue a total of 111,000,000 shares, par value of $ 0.0001 per share, consisting of (a) 110,000,000 shares of common stock, including (i) 100,000,000 shares of Class A common stock, and (ii) 10,000,000 shares of Class B common stock, and (b) 1,000,000 shares of preferred stock (the “Preferred Stock”). As of September 30, 2022 and March 31, 2022, there were 620,700 shares of Class A common stock issued and outstanding, excluding 12,650,000 shares of Class A common stock subject to possible redemption which are presented as temporary equity. As of September 30, 2022 and March 31, 2022, there were 3,162,500 shares of Class B common stock issued and outstanding. As of September 30, 2022 and March 31, 2022, no shares of Preferred Stock were issued or outstanding. The designations, voting and other rights and preferences of the Preferred Stock may be determined from time to time by the Company’s board of directors. 13 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS Rights Each holder of a right will receive one-tenth (1/10) of one share of Class A common stock upon consummation of a Business Combination. In the event the Company will not be the surviving entity upon completion of the Company’s initial Business Combination, each holder of a public right will automatically receive the 1/10 share of Class A common stock underlying such public right (without paying any additional consideration); and each holder of a Private Placement Right or right underlying Units to be issued upon conversion of the Working Capital Loans will be required to affirmatively convert its rights in order to receive the 1/10 share of Class A common stock underlying each right (without paying any additional consideration). If the Company is unable to complete an initial Business Combination within the required time period and public stockholders redeem the public shares for the funds held in the Trust Account, holders of rights will not receive any such funds in exchange for their rights and the rights will expire worthless. The Company will not issue fractional shares upon conversion of the rights. If, upon conversion of the rights, a holder would be entitled to receive a fractional interest in a share, the Company will, upon exchange, comply with Section 155 of the Delaware General Corporation Law. The Company will make the determination of how to treat fractional shares at the time of its initial Business Combination and will include such determination in the proxy materials that it will send to stockholders for their consideration of such initial Business Combination. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of rights will not receive any of such funds with respect to their rights, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such rights, and the rights will expire worthless. Further, there are no contractual penalties for failure to deliver securities to the holders of the rights upon consummation of a Business Combination. Additionally, in no event will the Company be required to net cash settle the rights, and the rights may expire worthless. Representative Warrants and Representative Shares Upon the closing of the IPO, the Company issued to the Underwriters Representative Warrants, the exercise price of which will be $ 12.00 per Share, and 101,200 Representative Shares. The Representative Warrants shall be exercisable, in whole or in part, commencing the later of October 26, 2022 and the closing of the Company’s initial Business Combination and terminating on October 29, 2026. The Company accounted for the 632,500 warrants as an expense of the IPO resulting in a charge directly to stockholders’ equity. The fair value of Representative Warrants was estimated to be approximately $ 1,333,482 (or $ 2.11 per warrant) using the Black-Scholes option-pricing model. The fair value of the Representative Warrants granted to the Underwriters was estimated as of the date of grant using the following assumptions: (1) expected volatility of 35 %, (2) risk-free interest rate of 1.18 % and (3) expected life of five years . The Representative Warrants and the shares of Class A common stock underlying Representative Warrants have been deemed compensation by FINRA and are therefore subject to a 180 -day lock-up immediately following October 29, 2021 pursuant to FINRA Rule 5110(e)(1). The Representative Warrants grants to holders demand and “piggy back” rights for periods of five and seven years from October 29, 2021. The Company will bear all fees and expenses attendant to registering the securities, other than underwriting commissions which will be paid for by the holders themselves. The exercise price and number of shares issuable upon exercise of the Representative Warrants may be adjusted in certain circumstances including in the event of a stock dividend, or the Company’s recapitalization, reorganization, merger or consolidation. However, the Representative Warrants will not be adjusted for issuances of Class A common stock at a price below its exercise price. The Underwriters agreed not to transfer, assign or sell any of the Representative Shares without the Company’s prior written consent until the completion of the Business Combination. The Underwriters agreed (i) to waive its redemption rights with respect to such shares in connection with the completion of the initial Business Combination and (ii) to waive its rights to liquidating distributions from the Trust Account with respect to the Representative Shares if the Company fails to complete its initial Business Combination within Combination Period. The shares have been deemed compensation by FINRA and are therefore subject to a lock-up for a period of 180 days immediately following October 29, 2021 pursuant to FINRA Rule 5110(e)(1). 14 DEEP MEDICINE ACQUISITION CORP. NOTES TO FINANCIAL STATEMENTS Note 11 - Fair Value Measurements The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at September 30, 2022 and March 31, 2022 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: Schedule of Fair Value Hierarchy Valuation September 30, March 31, Description Level 2022 2022 Assets: Marketable securities held in Trust Account 1 $ 128,428,444 $ 127,760,867 Note 12 – Subsequent Events On October 15, 2022, the Company issued two promissory notes in an aggregate principal amount of $ 1,265,000 (collectively, the “Notes”), to two affiliates of the Company’s Sponsor (collectively, the “Sponsor Affiliates”), in connection with the extension of the Combination Period from October 29, 2022 to January 29, 2023. The Notes bear no interest and are repayable in full upon the earlier of (a) the date of the consummation of the Company’s initial Business Combination, or (b) the date of the liquidation of the Company. On October 19, 2022, an aggregate of $ 1,265,000 was deposited into the Company’s trust account, which amount will be included in the pro rata amount distributed to (i) holders of Public Shares upon the Company’s liquidation or (ii) holders of Public Shares who elect to have their shares redeemed in connection with the consummation of the Company’s initial Business Combination. 15