v3.25.2
Warrants
12 Months Ended
Sep. 30, 2024
Warrants [Abstract]  
Warrants

Note 16 – Warrants

 

In connection with the reverse recapitalization, the Company has assumed 12,028,075 Energem warrants outstanding, which consisted of 11,500,000 public warrants and 528,075 private warrants. All of these warrants met the criteria for equity classification.

 

Each whole Warrant entitles the registered holder to purchase one whole share of the Company’s common stock at a price of $11.50 per share. Pursuant to the warrant agreement, a warrant holder may exercise its Warrants only for a whole number of shares of common stock. This means that only a whole Warrant may be exercised at any given time by a warrant holder. No fractional Warrants will be issued upon separation of the Units and only whole Warrants will trade. The Warrants will expire five years after the completion of the Company’s initial business combination or earlier upon redemption or liquidation.

 

The Company has agreed that as soon as practicable, but in no event later than 30 business days, after the closing of the initial business combination, it will use its reasonable commercially reasonable efforts to file, and within 60 business days following its initial business combination to have declared effective, a registration statement for the registration, under the Securities Act, of the shares of common stock issuable upon exercise of the Warrants. The Company will use its commercially reasonable efforts to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the warrants in accordance with the provisions of the warrant agreement. No Warrants will be exercisable for cash unless the Company has an effective and current registration statement covering the ordinary shares issuable upon exercise of the Warrants and a current prospectus relating to such shares of common stock. Notwithstanding the above, if the Company’s common stock is at the time of any exercise of a Warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of 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 it so elect, it will not be required to file or maintain in effect a registration statement, but it will be required to use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.

The Company may call the Warrants for redemption, in whole and not in part, at a price of $0.01 per Warrant:

 

at any time while the Warrants are exercisable;

 

upon not less than 30 days’ prior written notice of redemption (the “30-day redemption period”) to each Warrant holder; and

 

if, and only if, the reported last sale price of the ordinary shares equals or exceeds $18 per share, for any 20 trading days within a 30-trading day period ending on the third trading day prior to the notice of redemption to Warrant holders; and

 

if, and only if, there is a current registration statement in effect with respect to the ordinary shares underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.

 

The summary of warrants activity is as follows:

 

   Warrants
Outstanding
   Ordinary Shares
Issuable
   Weighted
Average
Exercise
Price
   Average
Remaining
Contractual
Life
 
September 30, 2023   
    
   $
    
 
Granted   12,028,075    12,028,075   $11.50    5.00 
Forfeited   
    
   $
     
Exercised   
    
   $
     
September 30, 2024   12,028,075    12,028,075   $11.50    4.00 

 

The Company accounted for the 12,028,075 Warrants assumed from the merger as equity instruments in accordance with ASC 480, “Distinguishing Liabilities from Equity” and ASC 815-40, “Derivatives and Hedging: Contracts in Entity’s Own Equity”.