合併和合並基本報表
艾米麗亞控股有限公司及其子公司
截至2023年12月31日和2022年12月31日（繼承者），以及截至2023年12月31日（繼承者）和期間從
2022年12月21日至2022年12月31日（繼任者），以及
2022年1月1日至2022年12月20日（前任）
獨立核數師報告
AMELIA控股公司及子公司
綜合和合並財務報表索引
合併和合計基本報表
獨立核數師報告 | 1 | |||||||
合併資產負債表 | 3 | |||||||
綜合損益表和全面損失綜合表 | 5 | |||||||
可轉讓可贖回優先股和股東赤字及母公司投資變動綜合表 | 6 | |||||||
現金流量綜合表 | 7 | |||||||
基本報表附註 | 8-36 | |||||||
獨立核數師報告
致Amelia Holdings, Inc.及其子公司股東
意見
我們已對Amelia Holdings, Inc.及其附屬公司（以下簡稱「公司」）的合併和合並基本報表進行了審計，包括2023年12月31日和2022年12月31日的合併資產負債表（繼任者），以及截至2023年12月31日的年度相關合並和合並損益表、可轉股可贖回優先股和股東權益以及母公司投資變動表、以及現金流量表，以及2022年12月21日至2022年12月31日期間（繼任者）、2022年1月1日至2022年12月20日期間（前任者），以及相關附註（統稱爲「基本報表」）。
依我們之見，附屬的基本報表在所有重大方面公允地展示了公司截至2023年12月31日及2022年12月31日（繼任者）的財務狀況，以及截至2023年12月31日（繼任者）年度和從2022年12月21日至2022年12月31日（繼任者）、2022年1月1日至2022年12月20日（前任者）期間的經營業績和現金流，符合美國通用會計原則。
意見依據
我們按照美國普遍接受的審計準則（GAAS）進行了審計。我們在這些準則下的責任在我們報告的基本報表審計職責部分進一步描述。根據與我們審計相關的倫理要求，我們被要求獨立於公司並滿足其他倫理責任。我們相信我們獲得的審計證據足夠並且適當，可以爲我們的審計意見提供依據。
公司繼續作爲一個持續經營實體的能力存在重大疑慮。
附帶的基本報表是基於公司將繼續作爲企業持續經營進行編制的。正如基本報表註釋2所討論的，在營運中公司一直遭受虧損，流動資金不足以償還第三方債權人應付的款項，並且指出存疑公司能夠持續作爲企業持續經營的重大問題。管理層對事件和情況的評估以及管理層關於這些事項的計劃也在註釋2中描述。基本報表不包括可能由於此不確定性結果而導致的任何調整。我們的意見就這個問題未經修改。
1
安永全球有限公司的一家成員會計師事務所
財務報表的管理層責任
管理層應根據美國通用會計原則編制和公正呈現基本報表，並設計、實施和維護與編制和公正呈現無實質性誤報責任相關的內部控制，無論是由於欺詐還是錯誤。
在準備基本報表時，管理層需要評估是否存在情況或事件，綜合考慮，關於公司在基本報表可發佈之後的一年內是否存在重大不確定性，可能導致公司無法持續經營。
財務報表審計的審計員職責說明
我們的目標是獲得對基本報表整體不存在重大錯誤的合理保證，無論是因欺詐還是錯誤，併發布一份包括我們意見的審計報告。合理保證是一種高水平的保證，但不是絕對保證，因此不保證按照GAAS進行的審計總能在存在重大錯誤時檢測到。未能發現由於欺詐導致的重大錯誤的風險要高於因錯誤導致的風險，因爲欺詐可能涉及串通、僞造、故意遺漏、虛假陳述或繞過內部控制。如果重大錯誤有實質性可能影響基於基本報表做出的合理用戶判斷，這些錯誤被視爲重大錯誤，無論是單獨還是合計。
根據GAAS進行審計，我們：
•在整個審計過程中行使專業判斷力並保持專業懷疑態度。
•識別和評估基本報表可能存在的重大錯報風險，無論是因欺詐還是錯誤，並設計並執行能夠應對這些風險的審計程序。此類程序包括審查基本報表中金額和披露的證據，以測試其有效性。
•了解與審計相關的內部控制，以設計適當的審計程序，但不是爲了表達對公司內部控制有效性的意見。因此，不表達此類意見。
2
安永全球有限公司的一家成員會計師事務所
•評估管理層使用的會計政策的適當性和重大會計估計的合理性，以及評估基本報表的整體呈現。
•根據我們的判斷，是否存在一系列條件或事件，對公司合理期間內作爲持續經營實體的能力存在重大疑慮。
我們需要就審計的計劃範圍和時間、重大審計發現以及我們審計過程中發現的某些內部控制相關事項與治理人員溝通。
/s/安永會計師事務所
2024年10月22日
3
安永全球有限公司的一家成員會計師事務所
.艾米麗亞控股有限公司及其子公司
基本報表
繼承人 | |||||||||||||||||
| 12月31日， | |||||||||||||||||
| 2023 | 2022 | ||||||||||||||||
| 資產 | |||||||||||||||||
流動資產： | |||||||||||||||||
現金及現金等價物 | $ | 11,358,793 | $ | 63,641,254 | |||||||||||||
應收賬款減去信用損失準備 | 19,746,822 | 15,315,273 | |||||||||||||||
預付費用和其他流動資產 | 7,215,935 | 8,554,754 | |||||||||||||||
遞延銷售佣金 | 1,081,752 | — | |||||||||||||||
總流動資產 | 39,403,302 | 87,511,281 | |||||||||||||||
資產和設備，淨值 | 355,657 | 105,779 | |||||||||||||||
使用權資產，淨額 | 353,186 | 883,912 | |||||||||||||||
遞延銷售佣金，非流動資產 | 2,580,173 | — | |||||||||||||||
無形資產，淨額 | 55,099,291 | 65,678,955 | |||||||||||||||
商譽 | 107,307,336 | 107,535,026 | |||||||||||||||
遞延融資成本 | — | 6,757,897 | |||||||||||||||
其他非流動資產 | 2,796,917 | 706,949 | |||||||||||||||
總資產 | $ | 207,895,862 | $ | 269,179,799 | |||||||||||||
| 負債、可轉換贖回優先股和股東權益赤字 | |||||||||||||||||
流動負債: | |||||||||||||||||
應付賬款 | $ | 6,874,163 | $ | 16,461,916 | |||||||||||||
應計費用及其他負債 | 20,308,300 | 20,683,027 | |||||||||||||||
償還短期債務 | 88,708,173 | — | |||||||||||||||
未來支付的權益負債 | 9,667,326 | 10,568,268 | |||||||||||||||
開空短期租賃負債 | 230,451 | 438,312 | |||||||||||||||
應相關方付款 | 1,394,565 | — | |||||||||||||||
推遲收益 | 26,646,326 | 28,527,980 | |||||||||||||||
流動負債合計 | 153,829,304 | 76,679,503 | |||||||||||||||
長期債務 | — | 71,350,820 | |||||||||||||||
遞延收入，非流動 | 12,292,181 | 12,592,507 | |||||||||||||||
遞延稅款負債 | 12,665,290 | 12,201,592 | |||||||||||||||
其他非流動負債 | 4,779,215 | 3,696,156 | |||||||||||||||
負債合計 | 183,565,990 | 176,520,578 | |||||||||||||||
承諾和事項 | |||||||||||||||||
A-1和A-2優先股，面值$0.001；共16,034,483股 | |||||||||||||||||
已授權7,780,941股已發行和流通股。截至2023年和2022年12月31日，總清算優先權爲 | |||||||||||||||||
$251,900,428和$226,939,186爲2023年和2022年12月31日的資產總額 | 251,900,428 | 226,939,186 | |||||||||||||||
股東赤字： | |||||||||||||||||
A和B類普通股，面值$0.001；授權253,933,170股；截至2023年和2022年12月31日，已發行和流通的股票共10,000萬股 | 100,000 | 100,000 | |||||||||||||||
共10,000萬股，爲2023年和2022年12月31日的發行和流通股 | |||||||||||||||||
額外實收資本 | — | — | |||||||||||||||
累計虧損 | (225,769,829) | (134,379,394) | |||||||||||||||
累計其他綜合損失 | (1,900,727) | (571) | |||||||||||||||
股東赤字總額 | (227,570,556) | (134,279,965) | |||||||||||||||
總負債、可轉換可贖回優先股和股東赤字 | $ | 207,895,862 | $ | 269,179,799 | |||||||||||||
詳見附註。
4
艾米麗亞控股有限公司及其子公司
合併綜合財務報表
經營業績和綜合虧損
| Successor | 前身 | |||||||||||||||||||||||||
| （合併） | （合併） | |||||||||||||||||||||||||
| 截至2023年12月31日的一年 | 2022年12月21日至2022年12月31日的期間 | 2022年1月1日至2022年12月20日的期間 | ||||||||||||||||||||||||
營業收入 | $ | 93,274,273 | $ | 2,628,105 | $ | 78,298,349 | ||||||||||||||||||||
研究和開發 | ||||||||||||||||||||||||||
收入成本（獨有折舊和攤銷） | 56,890,935 | 1,405,842 | 45,174,237 | |||||||||||||||||||||||
研發 | 13,582,104 | 283,783 | 9,883,905 | |||||||||||||||||||||||
銷售及營銷費用 | 25,059,789 | 1,205,427 | 24,145,614 | |||||||||||||||||||||||
ZSCALER, INC. | 29,039,659 | 10,306,465 | 32,151,975 | |||||||||||||||||||||||
折舊和攤銷 | 12,094,909 | 324,363 | 2,259,093 | |||||||||||||||||||||||
營業費用總計 | 136,667,396 | 13,525,880 | 113,614,825 | |||||||||||||||||||||||
經營虧損 | (43,393,123) | (10,897,775) | (35,316,476) | |||||||||||||||||||||||
其他收益（費用），淨: | ||||||||||||||||||||||||||
其他收入（費用）淨額 | (5,758,633) | (301,205) | 2,488,820 | |||||||||||||||||||||||
利息費用，淨額 | (16,782,137) | (407,420) | (6,596,317) | |||||||||||||||||||||||
總其他收入(費用)，淨額 | (22,540,770) | (708,625) | (4,107,497) | |||||||||||||||||||||||
稅前虧損 | (65,933,893) | (11,606,400) | (39,423,973) | |||||||||||||||||||||||
所得稅費用 | (495,300) | — | (549,339) | |||||||||||||||||||||||
淨虧損 | $ | (66,429,193) | $ | (11,606,400) | $ | (39,973,312) | ||||||||||||||||||||
其他綜合損失: | ||||||||||||||||||||||||||
外幣翻譯調整 | (1,900,156) | (571) | (150,356) | |||||||||||||||||||||||
總綜合虧損 | $ | (68,329,349) | $ | (11,606,971) | $ | (40,123,668) | ||||||||||||||||||||
詳見附註。
5
艾米麗亞控股有限公司及其子公司
合併綜合變動表
可轉換贖回股票和股東赤字及母公司投資
可轉換可贖回的優先A系列 優先股 | B類 普通股 | 資本公積金 | 累計其他綜合損失 | 累計赤字 | Net Parent Investment | 股東權益赤字總額 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 股份 | 數量 | 股份 | 數量 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2021年12月31日的前期餘額 | — | $ | — | — | $ | — | $ | — | $ | (371,773) | $ | — | $ | (51,528,696) | $ | (51,900,469) | ||||||||||||||||||||||||||||||||||||||||
向母公司的淨轉移 | — | — | — | — | — | — | — | (10,370,391) | (10,370,391) | |||||||||||||||||||||||||||||||||||||||||||||||
外幣翻譯調整 | — | — | — | — | — | (150,356) | — | — | (150,356) | |||||||||||||||||||||||||||||||||||||||||||||||
淨虧損 | — | — | — | — | — | — | — | (39,973,312) | (39,973,312) | |||||||||||||||||||||||||||||||||||||||||||||||
| 2022年12月20日的前任結餘 | — | — | — | — | — | (522,129) | — | (101,872,399) | (102,394,528) | |||||||||||||||||||||||||||||||||||||||||||||||
| 2022年12月21日的繼任者結餘 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
發行普通股以實現業務合併 | — | — | 100,000,000 | 100,000 | 29,247,639 | — | — | — | 29,347,639 | |||||||||||||||||||||||||||||||||||||||||||||||
發行A-1和A-2優先股，扣除發行成本淨額 | 7,780,941 | 74,918,553 | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
高級A系列優先股增值 | — | 152,020,633 | — | — | (29,247,639) | — | (122,772,994) | — | (152,020,633) | |||||||||||||||||||||||||||||||||||||||||||||||
累計轉換調整 | — | — | — | — | — | (571) | — | — | (571) | |||||||||||||||||||||||||||||||||||||||||||||||
淨虧損 | — | — | — | — | — | — | (11,606,400) | — | (11,606,400) | |||||||||||||||||||||||||||||||||||||||||||||||
| 2022年12月31日的繼任者餘額 | 7,780,941 | 226,939,186 | 100,000,000 | 100,000 | — | (571) | (134,379,394) | — | (134,279,965) | |||||||||||||||||||||||||||||||||||||||||||||||
累計轉換調整 | — | — | — | — | — | (1,900,156) | — | — | (1,900,156) | |||||||||||||||||||||||||||||||||||||||||||||||
Senior Series A優先股的增值 | — | 24,961,242 | — | — | — | — | (24,961,242) | — | (24,961,242) | |||||||||||||||||||||||||||||||||||||||||||||||
淨虧損 | — | — | — | — | — | — | (66,429,193) | — | (66,429,193) | |||||||||||||||||||||||||||||||||||||||||||||||
| 2023年12月31日的繼任者餘額 | 7,780,941 | $ | 251,900,428 | 100,000,000 | $ | 100,000 | $ | — | $ | (1,900,727) | $ | (225,769,829) | $ | — | $ | (227,570,556) | ||||||||||||||||||||||||||||||||||||||||
詳見附註。
6
艾米麗亞控股有限公司及其子公司
合併和聯合現金流量表
| Successor （合併） | 前身 （合併） | ||||||||||||||||||||||
| 截至年底 2023年12月31日 | 2022年12月21日至2022年12月31日的期間 | 2022年1月1日至2022年12月20日期間 | |||||||||||||||||||||
| 經營活動現金流量： | |||||||||||||||||||||||
| 淨虧損 | $ | (66,429,193) | $ | (11,606,400) | $ | (39,973,312) | |||||||||||||||||
| 調整爲淨損失到經營活動現金流量淨使用： | |||||||||||||||||||||||
折舊費用 | 76,156 | 3,318 | 196,718 | ||||||||||||||||||||
延遲佣金攤銷 | 388,062 | — | 3,613,652 | ||||||||||||||||||||
無形資產攤銷 | 12,011,421 | 321,045 | — | ||||||||||||||||||||
撥備 | 688,693 | — | 147,759 | ||||||||||||||||||||
延長費和可轉換債務利息的累積 | — | — | 5,419,167 | ||||||||||||||||||||
債務發行成本攤銷 | 3,379,335 | 99,731 | — | ||||||||||||||||||||
應計的債務到期時的以實物形式支付的利息 | 763,472 | ||||||||||||||||||||||
經營租賃資產的變動 | 365,124 | — | — | ||||||||||||||||||||
權證賠償金額的變化 | 1,533,042 | — | — | ||||||||||||||||||||
CVR公允價值變動 | 6,097,187 | ||||||||||||||||||||||
CVR的支付 | (6,998,129) | ||||||||||||||||||||||
子公司出售的淨利潤/損失 | (1,154,589) | — | — | ||||||||||||||||||||
其他 | — | 57,357 | (222,151) | ||||||||||||||||||||
經營性資產和負債變動: | |||||||||||||||||||||||
2,687,823 | (5,540,825) | (442,715) | 2,867,694 | ||||||||||||||||||||
遞延銷售佣金 | (4,038,528) | — | (4,569,430) | ||||||||||||||||||||
預付和其他流動資產 | 1,434,496 | (70,459) | (677,257) | ||||||||||||||||||||
其他非流動資產 | (2,089,968) | — | — | ||||||||||||||||||||
應付賬款、應計費用及其他負債 | (10,501,818) | (6,439,325) | 9,647,349 | ||||||||||||||||||||
工資負債 | (755,327) | (5,651,991) | 7,157,375 | ||||||||||||||||||||
經營租賃負債 | (371,222) | — | — | ||||||||||||||||||||
歸屬於關聯方的負債 | 1,394,565 | (6,339,462) | 2,839,462 | ||||||||||||||||||||
推遲收益 | (2,073,426) | 897,459 | 7,901,477 | ||||||||||||||||||||
| 經營活動使用的淨現金流量 | (71,821,472) | (29,171,442) | (5,651,497) | ||||||||||||||||||||
投資性活動提供的現金流量： | |||||||||||||||||||||||
| 業務收購，扣除現金收購 | — | (14,772,905) | — | ||||||||||||||||||||
| 出售子公司所收到的現金淨額 | 508,920 | — | — | ||||||||||||||||||||
| 購置固定資產等資產支出 | (353,595) | — | (91,629) | ||||||||||||||||||||
| 投資活動產生的淨現金流量 | 155,325 | (14,772,905) | (91,629) | ||||||||||||||||||||
| 籌資活動提供的現金流量： | |||||||||||||||||||||||
| 資本租賃義務的支付 | — | — | (81,928) | ||||||||||||||||||||
| 債務收益 | 20,000,000 | 67,954,111 | — | ||||||||||||||||||||
| 支付債務 | — | — | (2,358,201) | ||||||||||||||||||||
發行優先股淨收益 | — | 39,631,490 | — | ||||||||||||||||||||
| 劃轉給母公司 | — | — | (10,370,391) | ||||||||||||||||||||
| 籌集資金的淨現金流量 | 20,000,000 | 107,585,601 | (12,810,520) | ||||||||||||||||||||
| 匯率期貨影響現金流 | (616,314) | — | (85,408) | ||||||||||||||||||||
| 現金及現金等價物的淨增加（減少） | (52,282,461) | 63,641,254 | (18,639,054) | ||||||||||||||||||||
| 期初現金及現金等價物餘額 | 63,641,254 | — | 19,550,312 | ||||||||||||||||||||
| 期末現金及現金等價物 | $ | 11,358,793 | $ | 63,641,254 | $ | 911,258 | |||||||||||||||||
| 現金流量補充披露 | |||||||||||||||||||||||
普通和優先權證發行 | $ | — | $ | 3,106,482 | $ | — | |||||||||||||||||
支付的利息現金 | $ | 11,839,139 | $ | — | $ | 303,119 | |||||||||||||||||
支付的所得稅費用 | $ | 143,464 | $ | — | $ | 1,165,818 | |||||||||||||||||
| Senior Series A優先股累積 | $ | 24,961,243 | $ | 152,020,633 | $ | — | |||||||||||||||||
請參閱附註。
7
艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
註1.業務性質和組織
Amelia Holdings, Inc.及其子公司（以下簡稱Amelia Holdings、我們或公司）從事人工智慧（AI）和自動化解決方案及相關服務的開發和交付，旨在消除例行工作，釋放人才專注於通過創新創造價值。該公司總部位於紐約，目前在北美、歐洲和亞太地區進行業務。公司提供軟體產品和相關服務，服務多個行業，包括金融服務、保險和醫療保健。公司專注於基於軟體的人工智能產品和相關服務。
Amelia，我們基於人工智能的數字化資源解決方案已經建立在一系列從科技服務到業務工作流程（業務流程作為一種服務）的業務領域上。我們的人工智能能力嵌入Amelia操作設計中，用於監督和非監督式機器學習，推理（下一步操作）和自動化活動。通過執行以前由人類執行的任務，Amelia在實體和基於雲的技術基礎設施、應用程序和工作流程間作為“數字員工”的藍圖。Amelia產品和解決方案直接銷售，也通過渠道合作夥伴銷售。
該公司將其產品提供為一種軟體即服務（“SaaS”）方案，或者如果客戶需要在現場解決方案，則提供永久或有期限的許可證。關於該公司的Amelia軟體產品，還提供了維護和專業服務。 產品組合包括以下內容：
•Amelia Conversational AI - 軟體為基礎的勞動單位，按每個會話或每個使用者計費，涵蓋任務、活動和運行常規。這是聊天機器人、虛擬助手和機器人流程自動化模型的下一個演進階段。Amelia Conversational AI 是跨應用程式和工作流程功能點的軟體運行時任務。
•AIOps是一種專注於資訊技術（IT）的框架和人工智能平台。 AIOps是一種以機器學習、數據捕獲和數字化運營環境為重點的解決方案，專注於分析IT系統並協調多個操作自動化。 這些解決方案是根據IT服務管理平台、IT工作流程協調、人工智能、技術/基礎設施數據和雲操作系統的參考設計構建的。
•DigitalFirst - 提供人類等效服務，用於自主業務工作流程和內容/數據智能，首先由人力資本解決方案支持的數位代理執行，數位員工不斷學習。該解決方案由為各種垂直領域打造的數位代理組成，通過產品利用壽命中重新平衡人力和機器界面。
我們Amelia軟體的焦點，無論是內嵌於客戶產品中，還是通過我們的產品提供，是為了服務我們認為未來將有許多現有任務將由智能機器和系統執行的願景。
該公司於2022年8月19日在特拉華州成立，作為IPsoft Inc.（「前身母公司」）的全資子公司，旨在進行合併、股本交易所、重組或類似業務組合。
在2022年12月21日，前身母公司IPsoft, LLC（前身為IPsoft Incorporated）的唯一擁有人，與Build Group LLC（Build Group）一起完成了一系列交易，使公司成為Amelia Holdings II LLC（AHII）的所有已發行及流通股票的唯一擁有人（"重組"）。在重組之前，前身母公司經歷了一系列重組活動，完全將前身母公司分為兩個不同的業務板塊：1）Amelia Component（“Amelia”）和2）IP Center Service Component（“IP Center”）。由前身母公司持有的法律實體和其他合約關係組成了其業務運營。
8
艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
艾米莉亞的股權隨後轉入AHII，並於2022年12月21日完成重組，包括以下交易：
•前身母公司將其在AHII的利益捐贈給Amelia Holdings，並將其在Amelia Holdings的普通股權益（從Amelia Holdings於2022年8月19日初始成立時獲得的名義利益）換成了Amelia Holdings的100,000,000股b類普通股。前身母公司還獲得了一個具有約1060萬美元的公平價值和來自Amelia Holdings的一筆1000萬現金分配的條件價值權（見 附註3、對Amelia的收購）。
•Build Group LLC以3,654,170股Amelia Holdings的A-1優先股份，交換其持有的轉換可兌換票據3540萬美元與應計利息（最初由Amelia Holdings I, LLC於2021年12月13日發行給Build Group，作為業務轉移入AHII的法律步驟的一部分）。 Build Group收到的可兌換票據有效地作為與Amelia Holding收購Amelia有關的購買考慮的一部分在AHII轉讓中解決了可兌換票據，如下所述。 附註3.
•Build Group LLC以$4000萬現金貢獻換取了Amelia Holdings的4,126,771股A-2優先股。
•Build Group LLC獲得8,804,870張購買Amelia Holdings A類普通股的認股權證。
•Series A-2貢獻的收益被用來還清了一筆與惠普公司的未清餘額以及約560萬美元的與Amelia法律實體欠下的增值稅義務相關的款項（詳見 附註6，債務和資本租賃債務).
•作為這些交易的一部分，Amelia Holdings被允許賣出額外4000萬美元的A-3優先股，其特徵基本上與A-1和A-2相同。此外，BuildGroup被允許參與此項交易。A-3的銷售預計將在2023年6月30日之前進行，所得款項旨在贖回CVR（請參見注釋3）。
此外，在重新組織的同時，Amelia Holdings選擇從2022年12月21日起作為一家C型美國聯邦納稅主體。前身母公司作為一家子第S公司納稅。在此選擇改變之前，由前身母公司持有的法律實體在Amelia的運營中為美國的納稅所得，然後根據其擁有權分配到AHII，由後者負責支付相應的稅款，或累積遞延虧損。 在選擇以C公司納稅之後，Amelia Holdings將直接承擔其自身業務的美國聯邦所得稅。Amelia內收購的法律實體將繼續為外國稅務義務而納稅。
隨後並在對這些重組交易的完成的考慮之下，公司另外與monroe capital管理顧問有限責任公司（"monroe capital"）進行了融資安排。（見 註6）.
經重整後，由首選A-1和A-2股東控制的營運委員會通過Amelia Holdings於2022年12月21日收購了Amelia的控制財務利益，而該重整是根據《財務會計標準委員會會計標準專題805》進行會計處理的。 業務組合（“ASC 805”） （Amelia業務組合）。Amelia Holdings被視為是會計收購方，而Amelia則是被收購方和會計前身。因此，業務組合採用收購法進行會計處理，公司從Amelia記錄資產負債和承擔的公允價值，並且由此產生的新會計基礎反映在公司從2022年12月21日開始的所有期間的合併財務報表中（參見註釋3）。.
9
艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
2023年6月30日，普通股持有人對高級A優先股執行了看漲期權（見附註12）。當天普通股股東與高級A優先股持有人之間reached an agreement，確立了：
•從執行協議開始，到2024年3月31日之間，可以籌集所有基金類型並完成一項確定協議，以實現購回Senior Series A Preferred Stock。如果未完成，該努力將被視為交易失敗。
•在交易失敗的情況下，作為Senior Series A Preferred Stock的持有人，BuildGroup將再次被授權買入高達$4000萬的A-3型優先股，公司將被授權在90天內發行該優先股。
•交易失敗將導致拖賣觸發，允許大部分Senior Series A優先股股東自行協商並完成公司的出售。
於2024年3月31日發生了交易失敗。
附註2. 重大會計政策摘要
報告基礎
公司根據美國通行的會計原則（"GAAP"）編製其合並及組合基本報表（以下統稱"基本報表"）。
附帶的合併基本報表和相關資訊以繼任者和前任者的基礎呈現。前任者的提及指的是Amelia在Amelia業務合併結束前的營運結果、現金流和財務狀況。繼任者的提及指的是Amelia Holdings自2022年12月21日起的合併財務狀況和營運。
前身公司將於2021年12月31日及2022年1月1日至2022年12月20日期間（前身期間）以合併基礎呈現。繼承公司將於2023年12月31日和2022年12月31日以及2023年12月31日終了年度和2022年12月21日至2022年12月31日期間（繼承公司期間）以合併基礎呈現。 所有公司內部賬目和交易已經被消除。 截至2022年12月21日，Amelia Holdings沒有重大運營。
根據ASC 805範圍下應用的收購會計方法，作為Amelia業務組合結束之際，前任與繼任的基本報表以不同的會計基礎呈現，因此主要由於Amelia業務組合的影響而不可比較，其中包括施行收購會計處理於2022年12月21日以後的繼任者基本報表，更多描述見。 註記3， 最顯著的影響包括（i）無形資產的增加攤銷費用；（ii）與重組同時進行的債務融資安排相關的額外利息費用；以及（iii）歸因於Amelia業務組合的非經常性交易成本。
前身業務作為由前身母公司直接持有的一組法律實體和合同關係運營，並非獨立公司，在呈現的期間內。這些基本報表以合併基礎呈現，因為重組的最終步驟，包括在重組完成之前貢獻包括公司在艾米莉亞業務合併後構成的所有法律實體，尚未完成。歷史上並未為前身準備獨立的基本報表。附有的前身合併基本報表是根據前身母公司的歷史會計記錄編製的，並以“剔除”基礎呈現，以包括適用於前身的營運結果、淨母公司投資和現金流量。由於各種營運單位之間不存在直接擁有關係
10
艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
在合併基本報表中，涵蓋前身及前身母公司在前身期間的投資顯示為股東權益之外的淨母公司投資。營運合併報表包括所有可歸屬於前身的收入和成本，以及與前身母公司組織執行職能和服務相關的支出分配。這些支出已根據直接使用或福利（如可識別）的基礎，將其餘部分按照收入或員工人數的比例分配，公司認為這是反映使用或福利的方式。財務狀況合併報告將這些現金性質的支出呈現為營運活動中的現金流量，與前身母公司的成本性質一致。根據會計準則編碼第740號（“ASC 740”），根據前身的獨立結果（約當於採用獨立納稅人方法）計算當前和遞延所得稅及相關支出。 所得稅 （即按獨立申報方法）按照ASC 740對前身進行操作，就好像它是獨立納稅人一樣。
前身母公司與前身之間的交易在記錄交易時已有效結算。
所有配置在結合基本報表中都是基於管理層認為是合理的假設。然而，此處所包含的結合基本報表可能無法反映艾米莉亞業務未來的財務狀況、營運結果和現金流，或者如果艾米莉亞業務在呈現前身時是一個獨立的實體。
經營概念
這些基本報表是基於公司將繼續經營的假設進行準備的，即公司將在可預見的未來繼續運作並能夠在業務的正常運作中實現資產並履行負債。公司包括其前身業務在內，一直以來處於虧損狀態，並未持續從業務中產生足夠的現金流以支付其營運和其他現金支出。這些因素對公司繼續作為持續經營的能力提出重大疑問。基本報表中不包括任何與記錄資產的收回能力和分類，或者在公司無法繼續存續時可能需要的負債金額或分類相關的調整。公司的營業損失、現金餘額下降和相應的資金需求已迫使公司探索通過債務或股權籌集資金的潛在途徑，以克服這些困難。如果公司無法獲得額外融資，缺乏流動性可能對公司未來的營運計劃產生重大負面影響。公司將繼續積極尋求可用的融資機會，與客戶合作拓展未來銷售，並繼續控制成本。儘管公司相信其策略的可行性，但無法保證產生實際效果。
估計的使用
依據美國通用會計原則編製合併基本報表，需要管理階層進行估計、判斷和假設，這些將影響合併及合並基本報表以及相關附註中報告的金額。
管理層持續使用歷史經驗及其他因素評估其估計和假設，包括目前的經濟環境，管理層認為在該情況下是合理的。此類估計包括但不限於營業收入確認、延遲銷售佣金預期效益期間、應計負債會計處理、預期信用損失採計、已收購企業之購買價格分配、無形資產和商譽之評估，以及所得稅會計和相關評價準備。該公司根據事實和情況調整這些估計和假設。由於持續更改的經濟環境導致的這些估計變化將在未來期間的財務報表中反映。由於未來事件及其影響無法精確確定，實際結果可能因風險和不確定性而與這些估計和假設顯著不同。
11
艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
現金及現金等價物
公司在幾家高信用質量金融機構維護現金及現金等價物的帳戶。現金等價物可能包括原始到期日在購買當日起三個月或更短、能迅速轉換為現金的短期、高流動性投資。公司將其現金及現金等價物存放於銀行帳戶中，有時超過聯邦保險限額。公司未曾在此等帳戶中遭遇任何損失。2023年12月31日（繼承者），公司持有1010萬美元的美國國庫券（1級衡量），被歸類為現金等價物。2022年12月31日（繼承者），公司未持有任何現金等價物。
應收帳款和信用減損準備
應收帳款以開立的金額記錄，不產生利息並扣除信用虧損準備金。
採取應收賬款損失津貼以提供因應不可收回帳戶而估計的損失，主要根據歷史收款趨勢、核銷、應收帳款餘額的老化情況以及確定收款有懷疑的具體金額。管理層定期分析應收賬款餘額的可收回性以及控制項損失津貼的充足性，並考慮帳戶餘額的老化情況、歷史壞賬經驗、客戶集中度、客戶信用狀況、客戶財務狀況和信用報告以及當前和預期的經濟環境。如果我們客戶的財務狀況惡化，導致其付款能力受損，可能需要額外提存。當所有追收手段已盡而回收的可能性很小時，帳戶餘額將被核銷到津貼中。截至2023年12月31日和2022年（承繼者），預計信用損失的津貼分別為69.4萬和零。
當合同上確認的營業收入超過迄今為止對該合同的開票金額，且在給付該報酬之前僅需要時間的情況下，未開票應收款項會被記錄。截至2023年12月31日和2022年（繼承者），未開票應收款項分別為210萬美元和310萬美元，並在綜合資產負債表的應收賬款淨額中予以記錄。
推遲銷售佣金
公司會資本化一些銷售佣金，包括公司銷售團隊賺取的相關薪資稅，這些是遞增成本，如果沒有合同不會產生，被認為是取得客戶合同的可收回成本。推遲銷售佣金按成本標明，除待攤提金額預計通過所有客戶合同的未來營業收入來收回。
與新營業合同相關的資本化成本按估計的受益期間採用直線分攤，公司已鑑定這些受益期間的區間為4至5年，根據已銷售的相關產品或服務提供。在確定這些平均受益期間時，公司評估了定性和定量因素，其中包括其產品終身週期和客戶流失的估計。受益期間往往延伸至合同期限之外，因為續約支付金額與初始合同支付金額不相符。公司定期評估是否發生了業務、市場條件或其他事件的變化，這些事件表明其攤銷期應該更改，或者有潛在的損耗指標。
2023年結束日（繼承者）期間，$370萬、零和$360萬分別是延後的佣金成本資本化金額；在2022年12月21日至2022年12月31日（繼承者）及2022年1月1日至2022年12月20日（前身者）期間，資本化金額分別為零和$36百萬。至2023年12月31日（繼承者）結束日，延後的佣金成本攤提約為$38.8萬、零和$36百萬，分別包含在附帶的綜合損益綜述中的銷售和行銷費用。未有成本受損。
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艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
大寫以取得截至2023年12月31日（繼承者）年度的營業收入合約，以及繼承者期間從2022年12月21日至2022年12月31日，以及前身期間從2022年1月1日至2022年12月20日，分別為。
資產及設備
資產和設備按成本減累積折舊和攤銷後列示。折舊和攤銷採用相關資產預估使用壽命的直線法計算。作為資本租賃賬戶的資產將按照剩餘租期或預估使用壽命中較短的一者以直線法攤銷。維護和維修費用在發生時計入運營成本。
長壽資產減損
固定資產，如房地產和設備及無形資產，在事件或情況的變化表明資產帳面金額可能無法回收時，將對其進行減損審查。將持有和使用的資產的可回收性通過比較資產的帳面金額與預計未折現未來淨現金流量來衡量。如果資產或一組資產的帳面金額超過其預計未折現未來現金流量，則將根據資產的帳面金額超過資產公平價值的金額確認減損損失。
在繼任者或前任期間，皆未記錄任何財產和設備以及無形資產的減值費用。
商譽
公司記錄了由阿米莉亞業務組合造成的商認結果，詳情請參見下文第3條注。商認代表收購業務的公允價值超出收購的單獨識別淨資產的公允價值。商認不會攤銷，但會每年進行測試以判斷是否有損失，如果事件或情況的變化表明可能存在損失，則需要更頻繁地進行測試。公司評估定性因素，以判斷是否有必要為每個報告單位進行定量評估。如果需要進行定量評估，公司將確定每個報告單位的公允價值。如果報告單位的公允價值低於攜帶金額，公司將認列投資價值超出報告單位公允價值的金額。所認列的損失金額不得超過分配給報告單位的商認總金額。公司的年度測試日期為12月31日。確定公允價值需要作出重大判斷，包括對適當折扣率、長期增長率、相關可比公司盈利倍數以及預期未來現金流量的金額和時間的判斷。在截至2023年12月31日的年度測試中使用的折扣率和長期增長率分別為22.5%和3.0%。由此帶來的公允價值測量被認為是三級測量。為了測試商認是否有損失，公司已確定公司有一個單一的報告單位。在截至2023年12月31日的年份（繼任者）以及從2022年12月21日至2022年12月31日的繼任者期間，商認沒有任何商認損失。
軟件開發成本
在歷史上，前身曾為將要出售、出租或以其他方式推廣的軟件開發軟件開發成本。此類軟體開發成本在確定技術可行性之前按成本賬計提，一旦確定技術可行性後，這些成本將被資本化，直至產品可以提供給客戶進行一般發行為止。迄今為止，前身的軟件在建立技術可行性的同時可供一般發行，因此，前身沒有資本化任何開發成本。用於增強現有產品或在通過產品提供服務後的成本將按照發生時的期間賬計，主要包括於我們的合並綜合損益表中的員工相關成本。由於艾米利亞業務合併，公司收購了發展技術。 參見註釋3，該公司將主要利用來提供saas-云计算產品。因此，預計未來軟件開發成本將
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艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
為了滿足內部需求，並且在開發期間沒有實質計劃將這種軟件上市而產生的取得、開發或修改現有技術的相關費用。根據ASC 350-40規定， 內部使用軟件 （“ASC 350-40”）公司將會按照可資本化的軟件開發成本進行核算，其中包括在開發或取得內部使用計算機軟件時所產生的材料和服務相關費用，以及專門與該項目直接相關並投入時間的人員費用（包括相關福利和按股票給付的補償）。這些成本通常包括配置、編碼和測試過程中的內部勞動成本，這些活動發生在應用程序開發階段內，該階段始於初步項目階段完成之時，並且軟件能夠預計會完成並用於其預期功能；這部分成本應確定能夠將軟件的功能增加到一定程度時，方可進行資本化。當軟件基本完成準備投入使用，包括完成所有重要測試時，資本化即停止。公司將與特定升級和增強相關的成本進行資本化，當支出將可能導致增加功能時，否則此類成本將隨支出而支出。為數據轉換活動、培訓、維護、總務或與初期項目活動和後續操作活動有關的一般管理費用和間接成本所產生的成本將隨支出而支出。
截至2023年12月31日（繼承人）及2022年12月21日至2022年12月31日（繼承人）期間，公司認為其大部分開發工作不管是處於初步開發階段或操作階段（實施後），因此在這些期間未將任何成本資本化。
營收認證
公司從出售進入其 Amelia 和 AIOps 平台（「Amelia 軟體平台」）的授權、訂閱軟體的訪問權、訂閱服務的訪問權和專業服務方案中獲得營業收入。當我們將對承諾的產品和服務的控制轉移給客戶，並且合同下的履行義務得到滿足時，我們將認列反映我們預期從許可證的出售、訂閱服務的訪問權和專業服務方案中收到的對價的營業收入。
營業收入扣除從客戶處收取的任何稅金後予以確認，這些稅金後來要交付給政府機構（例如，銷售和其他間接稅）。
公司根據ASC 606要求的五步方法認識營業收入。 與客戶合同的營業收入 (ASC 606)要求公司識別與客戶的合約、辨認合約中的履行義務、判斷交易價格、將交易價格分配給辨認的履行義務，並在每個履行義務滿足時（或隨著其滿足）確認營業收入。
公司通常通過訂單形式與客戶簽訂合同，這些合同由主要銷售協議管轄。公司確定與客戶簽訂合同時，經批准的合同，雙方有關轉移許可證、訂閱或專業服務的權利以及這些產品和服務的付款條款都可辨認。公司已確定客戶具備支付能力和意願，且合同具有商業實質。公司在確定客戶的支付能力和意願時進行判斷，根據多種因素進行，包括客戶的過往支付經驗或新客戶的信貸、聲譽和與客戶有關的財務或其他信息。當簽訂合同時，公司評估合同是否屬於更大的安排，應該與其他合同一起核算，以及結合或單一合同是否包含多個履行義務。合同修改在執行我們的合同中是例行事項。合同通常會根據合同規格、要求或期限的變更進行修改。如果合同修改導致新增以單獨銷售價格定價的履行義務，或者如果修改後的服務與修改前提供的服務不同，則修改將單獨核算。如果修改後的服務不具有區分性，則將其視為現有合同的一部分核算。
履行義務是根據將轉移給客戶的許可、訂閱和專業服務來確定，這些許可、訂閱或專業服務既可獨立存在，客戶可以單獨或與其他來自第三方或公司提供的其他資源一起受惠，又在合同內是獨立的，轉讓許可、訂閱或
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艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
專業服務可以從合同中的其他承諾中單獨辨識。在合同中包含多個承諾的情況下，公司將進行判斷，以判定承諾的訂閱或服務是否能夠在合同的背景下被確定為獨立且独特的。如果這些標準未達到，或者如果履行的義務具有相同的確認模式，則將承諾的訂閱或服務作為一個結合的履行義務來核算。公司已經得出結論，其與客戶的合同中不包含導致單獨履行義務的保固。
支付條款與條件根據合同類型而異，儘管條款包括要求在30至60天內付款。它們通常不包括對所交付的產品或服務具有一般退換貨權的安排。在營業收入確認的時間不同於開具發票的時間時，我們的合同通常不包含重大融資組成部分。我們適用ASC 606中的實務簡化，並未就一年或更短期的支付條款評估是否存在重大融資組成部分。如存在重大融資組成部分，公司將據此調整承諾的考慮，以反映客戶對所承諾的商品或服務可能實際支付的現金銷售價格。
許可
與我們的Amelia軟體平台相關的許可證收入主要是授予客戶在特定時間內使用我們軟體產品的期限許可證，這種收入是在將許可證提供給客戶的時間點予以確認，即當將軟體許可證的控制權轉移給客戶時。對於許可證收入，我們會在提供許可證時或每年在合同週年紀念日開具發票。
訂閱
我們通過提供使用我們Amelia軟體平台（saas-云计算安排）相關的訂閱服務收入，來產生營業收入，對於這些安排，客戶沒有以重大懲罰的方式取得基礎軟體的合約權益，或者對客戶來說在自己的硬件上運行軟體或與第三方簽訂主機軟件的合約不可行。 saas產品是立即可展開履行的義務，提供對我們產品的訪問權，相關收入按照安排的合約期間以均速認列，從向客戶提供產品訪問權的日期開始並在服務控制轉移給客戶時。我們根據服務提供之前的每月、每年或一次性基礎來開具這些合同的發票。
訂閱服務收入還包括提供給許可和saas-云計算安排的持續客戶支持和維護，其中技術支持和提供未指定更新和升級以及按需提供的內容。持續的客戶支持和維護代表著現成的義務，將收入按照持續的客戶支持和維護期間分期認列。對於持續的客戶支持和維護服務，我們通常提前每年向客戶開具發票。
專業服務及其他
專業服務和其他營業收入包括我們通過軟體工程師使用Amelia軟體平台提供的托管服務的收入，該收入包括一系列相同的明顯服務，並且具有相同的轉移模式（即，明顯的服務日）。我們根據每月或每季的基礎向客戶開具托管服務發票，並在提供服務的期間內按比例確認收入。
此外，專業服務包括與許可證和訂閱服務一起出售的諮詢服務和實施服務。專業服務還可能包括測試/投入使用支援、用例的開發/部署和培訓。這些專業服務可基於按時間和材料計費或固定價格合同提供，並隨著服務的提供而隨時間承認營業收入。
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艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
具有多項履行義務的合同
我們與客戶的合約通常包含多個履約義務。若客戶合約涵蓋多項承諾的商品或服務，公司將運用判斷力以判斷承諾的商品或服務是否能夠被視為獨立且在合約內是獨立的，以便確定其履約義務。
我們根據合同提供的產品或服務預期收到的考慮來確定每個合同的交易價格。包含多個履約義務的合同需要按照相對獨立售價（SSP）將交易價格分配給每個履約義務。在適用時，公司根據履約義務之前通過過往交易出售的價格和與履約義務相關的內部批准價格指南來確定SSP。當因為交易數量有限或價格變動幅度很大而無法獲得這樣的可觀數據時，公司將使用剩餘法則估計獨立售價。專業服務的獨立售價通常是根據完成項目所需的工時估計，以專業服務按級別收取的標準費率卡來估算。
變量考量
如果交易價格包括變量考慮，公司會使用預期值方法估計變量考慮，考慮所有合理可得資訊，包括公司的歷史經驗和目前的期望。公司包括它預計收到的金額估計，如果有可能不會發生累計已認可的營業收入重大逆轉。公司已識別包含變量考慮的合同形式，以會話或基於使用情況的費用。這些費用與客戶可以使用Amelia的會話數量或我們Amelia軟體平台可以使用的設備數量有關。在這些情況下，客戶無義務支付超出最低購買義務的任何考慮，這將包含在最初交易價格中。基於使用情況的saas-云計算安排中的交易價格通常等於合同中的最低承諾，減去提供的任何折扣。與客戶簽訂的某些合同包含條款，如服務水平保證，以及各種潛在索賠，包括違反保證，可能導致變量考慮。此外，公司不時自行給予退款和信用。如果公司判斷，根據合同不會發生營業性未來重大累計收入逆轉，變量考慮將包括在交易價格中。
該公司對於軟體授權安排的最低購買義務以外的使用採用基於銷售或使用的特許金例外。
我們部分客戶安排中包含了便利終止條款，針對某些服務，如果客戶未使用的預付金額超出相應比例，將提供客戶相應比例的退款。
合約資產和負債
營業收入確認的時機可能與向客戶開具發票的時間不同，這些時間差異導致公司合併資產負債表上出現應收款項、合同資產（未開票的收入）或合同負債（預收收入）的情況。當公司具有無條件開具發票並從客戶收取款項的權利時，公司會記錄與營業收入相關的應收款項。當營業收入在開具發票之前確認，且公司沒有無條件開立發票或與滿足履行承擔風險的相關性仍存在時，公司將記錄未開票的收入。
這裡的延遲收入主要包括提前收取的客戶帳單或款項，以及從客戶合同中確認收入之前收到的款項，其中包括不可取消和不可退款的承諾基金以及可退款的客戶存款。預計於隨後十二個月內確認的延遲收入被記錄為當期的延遲收入，其餘部分則被記錄為非流動。
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艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
營業費用
公司的運營費用包括營收成本、研發、銷售和市場營銷、總務和行政以及折舊和攤銷。
公司的營業成本主要包括與Amelia的營業收入流向直接相關的成本，如上述所述。這主要包括與雲端服務的主機相關的成本，如網絡管理，某些與這些營業收入相關的人員費用，包括工資、福利和獎金，以及設施成本的分攤。
研究和開發活動包括與開發活動直接相關的人員相關費用，如持續改進和構想用例，以及用於研究和開發目的的技術用品和idc概念容量相關的成本。
業務和營銷活動旨在吸引新客戶並增加公司與現有客戶的業務。業務和營銷活動主要由與人員相關的成本和銷售人員以及銷售員工的佣金相關的設施成本所組成。
總務和行政活動包括專業費用、一般企業成本以及總部開支，包括行政、財務、法律和人力資源活動相關的人員費用。
折舊和攤銷包括公司資產和設備的折舊以及無形資產的攤銷。
所得稅
公司利用資產和負債方法核算所得稅，該方法要求就所包含於合併基本報表中的事件的預期未來稅後後果辨識递延所得稅資產和負債。根據此方法，递延所得稅資產和負債是基於資產和負債的財務報告和稅務基礎之間的差異，使用頒布的稅率確定的，在差異預計反轉的年份。
公司記錄淨递延稅資產，以其認為這些資產更可能能夠實現為界。在做出這種判斷時，公司考慮所有可用的正面和負面證據，包括現有可徵稅暫時性差額未來的逆轉、未來預測的可徵稅收入、稅務策略以及最近的財務業務。如果公司決定未來能夠實現超過其淨記錄金額的递延所得税資產，公司將對減值準備進行調整，這將減少所得稅提供。
公司根據所得稅會計準則來計算不確定稅務立場。公司每年辨識和分析每一個稅務立場，以判斷根據技術內容而言，是否可能是在被稅務機關挑戰時能被合理支持的（相對最優位機率）。一旦公司確認符合相對最優位機率閾值的稅務立場，公司便測算潛在風險情境的累積機率，以確定應記錄為不確定稅務立場負債的適當金額，該金額將包括在審查時如立場不能被支持所需的額外稅款、利息和罰款。我們將與不確定稅務立場相關的利息和罰款作為我們合併及合并營運報表中所得稅支出的一部分來列示。
外幣
公司各國際子公司的功能貨幣為其本地貨幣。外國營運的賬戶使用資產和負債的匯率在財務報表日期翻譯為美元，營業收入和費用賬戶的期間採用平均普遍匯率。
17
艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
翻譯所致之調整已包括在累積其他綜合收益（損失）中。
實現和未實現的交易收益和損失均包含在我們的綜合和合併營運報表中，分別在發生時期列示。公司在2023年12月31日結束的年度（新公司時期）、2022年12月21日到2022年12月31日的新公司時期以及2022年1月1日到2022年12月20日的舊公司時期分別承認了150萬美元、30.1萬美元和240萬美元的凈外幣損失。
公允價值衡量
公平價值被定義為資產或負債的交易價格，即在資產或負債的主要或最有利市場上，在衡量日期以市場參與者之間的有序交易中收到或支付的價格（退出價）。以公平價值計量的資產和負債使用優先考慮用於計量公平價值的輸入的三層公平價值層次分類報告。該層次最大化使用可觀察輸入，並將不可觀察輸入的使用降至最低。
衡量公平價值所使用的三個層次輸入如下：
•第1級——對於相同金融工具在活躍市場中報價。公平值層次給予第1級輸入最高優先級。
•第2級 - 在活躍市場中報價相似工具的價格；在不活躍市場中報價相同或相似工具的價格；以及當直接觀察到輸入數據或觀察到重要價值驅動因素時，由模型衍生的估值。
•第3級 - 儀器的重要價值驅動因素對第三方不可觀察。 公平價值層次給予第3級輸入最低的優先級。
財務資產和負債根據對公允值測量具有重要意義的最低級別進行整體歸類。公司對某一特定輸入對公允值測量的重要性進行評估需要判斷，並且可能影響這些被測量的資產和負債的估值，以及它們在公允值層級內的位置。
某些金融工具（包括現金及約當現金、應收帳款、預付款項及其他流動資產、應付帳款及應計費用以及工資負債）的公允價值近似成本，原因在於這些項目的短期性質。2023年12月31日和2022年的債務（繼承者）的公允價值，由於最近發行的性質，近似於攜帶價值，因此利率和基本條款近似公允價值。公司的非金融資產（包括不動產和設備）無需定期以公允價值測量。但是，如果發生某些觸發事件，或者需要進行年度減值測試，公司需要評估非金融資產是否存在減值。當攜帶價值超過資產公允價值時，將承認減值損失。
本公司持有發行和未發行的優先和普通股的認股權證，根據2023年和2022年12月31日（繼承人）合併資產負債表歸類為其他非流動負債。每個報告期間，認股權證的公允價值均使用期權定價模型（3級測量）進行衡量，對公允價值測量的影響在合併和綜合損益表中確認。如需更多資訊，請參考附註12。
信用風險集中和重要客戶
潛在使公司面臨重大信用風險的財務工具主要包括現金及現金等價物，以及應收款項。
18
艾米利亞控股公司及其附屬公司
合併及合併後基本報表附註
所有板塊的客戶都包括企業和政府實體。少數客戶佔到了公司迄今為止的一大部分營業收入和應收帳款。公司在業務正常運作過程中向客戶提供信用，並且不需要任何擔保來保證應收帳款。
On December 31, 2023 and 2022 (Successor), one customer accounted for 11.6% of the Company’s accounts receivable. No single customer accounted for more than 10% of the Company’s revenue for the year ended December 31, 2023 (Successor period). No single customer accounted for more than 10% of the Company’s revenue for the Successor period from December 21, 2022 through December 31, 2022, and for the Predecessor period from January 1, 2022, through December 20, 2022.
Recently Adopted Accounting Pronouncements
In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which changes how entities will recognize assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers. The provisions of ASU 2021-08 require acquiring entities to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic 606), as if it had originated the contracts. The provisions of ASU 2021-08 are effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company early adopted the standard and retrospectively applied it to all business combinations that occurred during the fiscal year 2022, as required by the standard in the year of adoption. As a result, the Company recorded the unbilled and deferred revenue assumed related to the Amelia Business Combination at their carrying amounts.
In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), as subsequently amended. ASU 2016-13 changes the methodology for measuring credit losses of financial instruments and the timing of when such losses are recorded. ASU 2016-13 is effective for private companies in fiscal years, and interim periods within those years, beginning after December 15, 2022, with early adoption permitted. Effective January 1, 2023, the Company adopted the requirements of ASU 2016-13, using the modified retrospective transition approach. The adoption of this standard did not have a material impact on the Company’s consolidated and combined financial statements.
NOTE 3. AMELIA BUSINESS COMBINATION
The Reorganization discussed in Note 1. Nature of Business and Organization was accounted for by Amelia Holdings in accordance with the acquisition method of accounting pursuant to ASC 805 as Amelia Holdings obtained a controlling financial interest in Amelia and Amelia constitutes a business with inputs, processes, and outputs. Topic 805 requires the Company to recognize acquired assets, including identifiable intangible assets and all assumed liabilities, at fair value on the acquisition date. Determining the fair value of assets acquired and liabilities assumed requires management’s judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash flows, discount rates and asset lives. The fair value of assets deemed acquired and liabilities assumed was determined based on assumptions that reasonable market participants would use in the principal (or most advantageous) market for the asset or liability. The excess of the fair value of purchase consideration over the values of these identifiable assets and liabilities is recorded as goodwill.
Acquisition costs, such as legal and consulting fees, are expensed as incurred and are recorded within general and administrative expenses. Acquisition costs of approximately $9.8 million incurred in connection with the Amelia Business Combination were expensed in the Successor period.
The Company’s management, with the assistance of a third-party valuation firm, estimated the fair value of the Company’s assets and liabilities as of the acquisition date of December 21, 2022. The Company finalized the fair values of the assets acquired and liabilities assumed during 2023 with no material adjustments.
The following represents the purchase price allocation for the Amelia Business Combination:
19
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
Fair Value | |||||
Successor | |||||
Fair value of Class B common stock issued | $ | 29,347,639 | |||
Cash consideration | 15,684,263 | ||||
Contingent value right issued | 10,568,268 | ||||
Convertible promissory note settled | 35,419,136 | ||||
Total purchase consideration | 91,019,306 | ||||
| Cash | 911,358 | ||||
Accounts receivable | 14,872,558 | ||||
Other current assets | 8,637,385 | ||||
Intangible assets | 66,000,000 | ||||
Other non-current assets | 1,703,155 | ||||
Total identifiable assets acquired | 92,124,456 | ||||
Accounts payable and accrued liabilities | 26,266,977 | ||||
Other liabilities | 29,503,041 | ||||
Deferred revenue | 39,901,014 | ||||
Deferred tax liabilities | 12,164,500 | ||||
Other non-current liabilities | 576,953 | ||||
Net identifiable assets acquired | (16,288,029) | ||||
| Goodwill | $ | 107,307,335 | |||
Acquired intangible assets are comprised of the following:
Description | Fair Value (Successor) | Useful Life in Years | |||||||||
Customer relationships | $ | 17,500,000 | 7 years | ||||||||
| Technology | 44,000,000 | 5 years | |||||||||
| Tradename | 4,500,000 | 7 years | |||||||||
Total intangible assets acquired | $ | 66,000,000 | |||||||||
The fair value of consideration transferred was determined using a combination of valuation methodologies including the subject company transaction method, discounted cash flow (DCF) method and guideline public company method. As a result of the acquisition the Company recorded $66.0 million of intangible assets, as well as goodwill of $107.3 million. The Goodwill recognized is due to the expected cost savings and growth opportunity associated with product development of our AI based products.
The fair value estimates for assets acquired and liabilities assumed were based on income valuation methods using primarily unobservable inputs developed by management, which are categorized as Level 3 in the fair value hierarchy. The fair value of tradenames was determined using an income approach based on the relief from royalty method. The fair value of technology was determined using multi-period excess earnings method. The fair value of customer relationships was determined using a with or without method. For the fair value estimates, the Company used: (i) projected discounted cash flows, (ii) historical and projected financial information, (iii) royalty rates and (iv) attrition rates, as relevant, that market participants would consider when estimating fair values. The Company is amortizing the acquired identifiable definite-lived intangible assets over their estimated useful lives from the acquisition date, which is consistent with the estimated useful life considerations used in determining their fair values. For the Successor periods from December 21, 2022 through
20
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
December 31, 2022 and for year ended December 31, 2023, the Company recorded approximately $321 thousand and $12 million of amortization expense on the acquired intangible assets, respectively. The estimated aggregate amortization expense for each of the five succeeding fiscal years is approximately $11.9 million in each year. The weighted-average amortization period is approximately 5.7 years. Accumulated amortization of intangible assets totaled $12.5 million and $0.3 million as of December 31, 2023 and 2022 (Successor), respectively, and were recorded within intangibles, net on the consolidated balance sheets. The Amelia Business Combination did not result in a material step-up in the tax basis of any of the acquired assets (including Goodwill) for U.S. federal income tax purposes.
As part of the purchase consideration transferred, the Company entered into a Contingent Value Right (“CVR”) Agreement (“CVR Agreement”) with the Predecessor Parent with a stated value of $40.0 million. The stated value of the CVR is reduced by lease payments that the Company will make on behalf of the Predecessor Parent until the earlier of the date a Qualified Financing, as defined in the CVR Agreement, occurs, or June 30, 2023. The remaining stated value of the CVR after any lease payments will be satisfied as follows:
1)Cash payment to the Predecessor Parent upon receipt of proceeds from any Qualified Financing.
2)If a Qualified Financing does not occur, the Company will issue Series A-4 Preferred Stock on June 30, 2023, based on the remaining stated value divided by $9.69.
The Company determined that the fair value of the CVR issued as part of the overall purchase consideration was $10.6 million as of December 21, 2022.
On June 30, 2023, the Company separately modified the CVR Agreement with its Predecessor Parent. The significant modifications were as follows:
1)The CVR stated valued was increased by $3.6 million.
2)The Company extended the period of time in which it funded the lease payments on behalf of the Predecessor Parent through December 31, 2023. These lease payments reduced the amended CVR balance through December 31, 2023.
3)The original conversion date of the CVR to Series A-4 of June 30, 2023, was modified to set a termination date at the earlier of the CVR amount reducing to zero or the date on which the Company issues either a promissory note or Series A-4 Preferred Stock to settle the CVR. The issuance of Series A-4 Preferred Stock was to occur thirty days after a Transaction Failure as defined in the agreements.
4)The agreement regarding subleasing of floors was reduced from three floors to two floors as of January 1, 2024, however no sublease has been executed.
5)The agreement regarding subleasing of floors was reduced to zero should a successful financing be completed that fully redeems the Series A Preferred Stock.
6)The requirement to utilized funds from sale of Series A-3 Preferred Stock, if any, for the redemption of CVR balances was terminated.
As of December 31, 2023, the stated balance of the CVR is approximately $36.5 million as the Company continued to make lease payments on behalf of the Predecessor Parent through December 31, 2023. The fair value has been recorded as $9.7 million.
The Company elected to account for the CVR under the fair value option as it believes this election best reflects changes in fair value of consideration that is expected to be transferred. The fair value estimate is considered a Level 3 measurement. Changes in fair value are recognized through earnings within other income (expense), net on the consolidated and combined statements of operations and comprehensive loss.
21
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
The following is a roll forward of the fair value of the CVR for the periods from January 1, 2022 through December 20, 2022 (Predecessor), December 21, 2022 through December 31,2022 (Successor) and for the year ended December 31, 2023:
| Balance on January 1, 2022 (Predecessor) | $ | — | |||
| Issuance of CVR at fair value on December 21, 2022 (Successor) | 10,568,268 | ||||
| Change in fair value | — | ||||
| Balance on December 31, 2022 (Successor) | 10,568,268 | ||||
| Paydowns of CVR | (6,998,129) | ||||
| Change in fair value | 6,097,187 | ||||
| Balance on December 31, 2023 | $ | 9,667,326 | |||
NOTE 4. REVENUE
Disaggregation of Revenue
The following table presents our revenues disaggregated in accordance with the timing of when performance obligations are satisfied:
Successor | Predecessor | ||||||||||||||||
Year ended December 31, 2023 | Period from December 21, 2022 to December 31, 2022 | Period from January 1, 2022 through December 20, 2022 | |||||||||||||||
| Revenue recognized at a point in time: | |||||||||||||||||
License | $ | 4,523,687 | $ | — | $ | 3,823,276 | |||||||||||
| Revenue recognized over time: | |||||||||||||||||
Services and other | 17,423,051 | 739,155 | 21,311,045 | ||||||||||||||
Subscription | 71,327,536 | 1,888,950 | 53,164,028 | ||||||||||||||
| Total revenue | $ | 93,274,273 | $ | 2,628,105 | $ | 78,298,349 | |||||||||||
22
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
Revenue by geographic region for the periods presented are summarized below:
Successor | Predecessor (Combined) | ||||||||||||||||
Year ended December 31, 2023 | Period from December 21, 2022 to December 31, 2022 | Period from January 1, 2022 through December 20, 2022 | |||||||||||||||
| Revenue by region: | |||||||||||||||||
United States of America | $ | 68,086,415 | $ | 1,897,864 | $ | 57,359,603 | |||||||||||
International | 25,187,858 | 730,241 | 20,938,746 | ||||||||||||||
| Total revenue | $ | 93,274,273 | $ | 2,628,105 | $ | 78,298,349 | |||||||||||
Contract Asset and Liability Balances
Unbilled revenue totaled $3.5 million and $4.6 million as of December 31, 2023 and 2022 (Successor), respectively, and were recorded within prepaid expenses and other current assets on the consolidated balance sheets. There were no impairments to contract assets in either the Successor or Predecessor periods.
Deferred revenue balances were $38.9 million and $41.1 million (net of deferred interest on significant financing component), as of December 31, 2023 and 2022 (Successor), respectively.
Revenues recognized included in the balances of the deferred revenue at the beginning of the reporting period for the year ended December 31, 2023 (Successor), for the period from December 21, 2022 through December 31, 2022 (Successor), and for the period from January 1, 2022 through December 20, 2022 (Predecessor) were $29.5 million, $2.6 million, and $18.8 million, respectively.
As of December 31, 2023, the aggregate amount of the transaction price allocated to the remaining performance obligations related to customer contracts that were unsatisfied or partially unsatisfied was $82.1 million. Given the applicable contract terms, $53.1 million is expected to be recognized as revenue within one year and $29.0 million is expected to be recognized between 2 to 5 years. This amount does not include contracts to which the customer is not committed, contracts for which the Company recognizes revenue equal to the amount the Company has the right to invoice for services performed, or future sales-based or usage-based royalty payments in exchange for access to the Company’s services. This amount is subject to change due to future revaluations of variable consideration, terminations, other contract modifications or currency adjustments. The estimated timing of the recognition of remaining unsatisfied performance obligations is subject to change and is affected by changes to scope, changes in the timing of delivery of products and services, or contract modifications.
23
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
NOTE 5. PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid expenses and other current assets consist of the following:
Successor | |||||||||||
| December 31, | |||||||||||
| 2023 | 2022 | ||||||||||
| Prepaid expenses | $ | 1,244,333 | $ | 1,157,698 | |||||||
| Other receivables | 2,471,602 | 2,798,687 | |||||||||
| Contracts assets | 3,500,000 | 4,598,369 | |||||||||
| Total prepaid expenses and other current assets | $ | 7,215,935 | $ | 8,554,754 | |||||||
NOTE 6. ACCRUED EXPENSES AND OTHER LIABILITIES
Accrued expenses and other liabilities consist of the following:
Successor | |||||||||||
| December 31, | |||||||||||
| 2023 | 2022 | ||||||||||
| Payroll liabilities | $ | 8,906,108 | $ | 10,138,398 | |||||||
| Accrued expenses | 5,361,655 | 6,237,470 | |||||||||
| Other tax liability and sales tax | 6,040,537 | 4,307,159 | |||||||||
| Total accrued expenses and other liabilities | $ | 20,308,300 | $ | 20,683,027 | |||||||
NOTE 7. DEBT AND CAPITAL LEASE OBLIGATIONS
The carrying amount of current and non-current debt, net of unamortized discounts, is as follows:
Successor | |||||||||||
| December 31, | |||||||||||
| 2023 | 2022 | ||||||||||
| Monroe Term Loan Facility, net of discounts | $ | 70,484,643 | $ | 71,350,820 | |||||||
| Monroe Delayed Draw Facility, net of discounts | 17,384,375 | — | |||||||||
| Monroe Revolving Loan Facility | 839,155 | — | |||||||||
| Total debt obligations | 88,708,173 | 71,350,820 | |||||||||
| Less: current portion of debt | (88,708,173) | — | |||||||||
| Non-current portion of debt | $ | — | $ | 71,350,820 | |||||||
At December 31, 2023 and 2022 (Successor) the Company’s consolidated balance sheet has $22.7 million and $26.2 million, respectively, of unamortized debt issuance costs related to the Company’s debt facilities which are presented as a direct reduction of the Company’s current and non-current debt, respectively, as discussed in the Monroe Credit Agreement section below. The carrying amount of the Company’s debt approximates fair value at each balance sheet date and is considered a Level 3 measurement.
24
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
Monroe Credit Agreement (Successor)
On December 21, 2022 the Company entered into an agreement with Monroe Capital whereby Monroe Capital extended credit to the Company in the form of (a) a term loan in the aggregate principal amount of $75 million on the closing date (the “Term Loan Facility”), (b) a $25 million committed delayed draw term loan facility (the “Delayed Draw Term Loan Facility”) and (c) a $5 million committed revolving loan facility (the “Revolving Loan Facility”). The Term Loan Facility proceeds was funded on December 21, 2022. There were no borrowings outstanding under the Delayed Draw Term Loan Facility and Revolving Loan Facility as of December 31, 2022. There were outstanding borrowings of $75.0 million on the Delayed Draw Term Loan Facility and Revolving Loan Facility, respectively, as of December 31, 2023. The Delayed Draw Term Loan has a termination date of June 21, 2024 to the extent any of the committed amounts remain undrawn. As of December 31, 2023, $6.0 million and $4.0 million of the Delayed Draw Term Loan and Revolving Loan Facility, respectively, remained undrawn. On December 31, 2023 and 2022, the future debt maturities of $110.8 million and $90.8 million (inclusive of Exit Fees discussed below). All credit facilities under the Monroe Credit Agreement have a maturity date of December 21, 2027, unless the Preferred Shareholders exercise their redemption rights prior to that in which case all amounts would be fully due to Monroe Capital at that time, or we fail a covenant without a waiver.
The Term Loan Facility carries a variable interest rate based on the secured overnight financing rate administered by the Federal Reserve Bank of New York (the “SOFR”), an applicable margin and monthly periodic interest period adjustment, totaling a rate of 14.6% and 13.8% as of December 31, 2023 and 2022, respectively.
Lender fees and third-party debt issuance costs in the total amount of $7.6 million were incurred associated with execution of the Monroe Credit Agreement. The Company also will incur an Exit Fee of $15.7 million payable to Monroe Capital upon the earlier of maturity or such other date as the obligations under the credit agreement are paid in full. Additionally, Monroe Capital received at no charge warrants to acquire shares of the Company’s Series A-2 Preferred Stock at an amount equal to 7.5% percent of the Total Commitments. The Series A-2 Preferred Stock warrants were determined to have a fair value of $2.9 million at the issuance date, which was recorded within other non-current liabilities on the consolidated balance sheet as of December 31, 2022 (Successor), refer to Note 12. Each of the above amounts, $26.2 million in total, are collectively treated as capitalized debt issuance costs related to each of the credit facilities and therefore allocated between the Term Loan Facility, Delayed Draw Term Loan Facility, and Revolving Loan Facility based on the commitment amount of each facility relative to the total commitments of $105.0 million. The Company amortizes deferred financing costs using a method that approximates the effective interest method over the term of the related financing.
In addition to the interest rates set forth above, prior to the Conversion Date, each loan shall accrue interest at 1% per annum (the “PIK Rate”) and the amount accrued shall be paid in kind monthly in arrears on the last business day of each calendar month, beginning with the month ending December 31, 2022. Any interest that is paid in kind under this provision shall be capitalized and added to the outstanding principal amount of such. The Company accrued $763 thousand related to paid in kind interest as of December 31, 2023.
Amortization of debt issuance costs across all three credit facilities amounted to approximately $3.4 million and $100 thousand for the year ended December 31, 2023 (Successor periods), and from December 21, 2022 through December 31, 2022 (Successor period), respectively, and is reflected in the consolidated and combined statements of operations and comprehensive loss, together with interest expense. Interest expense recorded in the consolidated statements of operations and comprehensive loss amounted to $12.3 million and $285 thousand for the year ended December 31, 2023 (Successor period), and from December 21, 2022 through December 31, 2022 (Successor period), respectively, related to Monroe Credit Agreement.
The Borrower shall repay the principal amount of the Term Loan Facility on the last business day of each quarter, beginning with the first fiscal quarter ending after the Conversion Date, in an amount equal to the product of (A) the original funded principal amount and (B) 0.25%. The loans are subject to mandatory prepayment upon receipt of certain proceeds, or excess cash flows, as defined, after the Conversion Date.
Under the terms of the relevant financing agreements with Monroe, the Company has granted Monroe a security interest in substantially all assets of the Company. In addition, the Company has pledged 100% of the stock and/or equity interests of
25
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
the following companies: Amelia Holding II LLC, Amelia Holding I LLC, Amelia US LLC, IPsoft Government Solutions, LLC, and Amelia NL BV.
The Monroe Credit Agreement also has an acceleration clause relating to a change in control in which the Preferred Stockholder would no longer exercise the same voting and other protective provisions as established as of December 21, 2022. In addition, if the Preferred Stockholder exercised its redemption rights under the Preferred Stock Agreement, as described in Note 12, all amounts due under the Monroe Credit Agreement (including the Exit Fee) would accelerate to Monroe Capital prior to any amounts due to the Preferred Stockholder as a result of exercising the redemption right.
Pursuant to the Monroe Credit Agreement, the Company agreed to certain restrictive covenants, including the following financial covenants:
Recurring Revenue Leverage Ratio
Prior to a conversion date, the Recurring Revenue Leverage Ratio, defined as the ratio of (a) Consolidated Total Debt to (b) Annualized Recurring Revenue as tested on a quarterly basis ranging from a ratio of 1.50: 1.00 to 0.75: 1.00 over the life of the debt facilities.
Minimum Liquidity
Prior to a conversion date, the Monroe Credit Agreement does not permit liquidity at any time to be less than $15,000,000. Liquidity is defined in the agreement as the combination of cash and cash equivalents, and the accessible but unused portion of the Revolving Loan Facility.
Total Net Leverage Ratio
From and after the Conversion Date, the Total Net Leverage Ratio, defined as the ratio of (a) Consolidated Total Debt as of such date minus the aggregate amount of unrestricted cash and Cash Equivalents held as of date in such deposit or securities accounts subject to Control Agreements up to a maximum of $5,000,000 (subject to certain adjustments) to (b) Consolidated EBITDA on a quarterly basis ranging from a ratio of 7.00 : 1. 00 to 4.00 : 1.00 over the life of the debt facilities.
On June 27, 2024, Monroe Capital exercised its rights under the Monroe Credit Agreement to convert Amelia Holdings II, LLC, the legal borrower and direct subsidiary through which the Company manages all other subsidiaries, from a member managed company to a manager managed company, appointing an independent manager.
On July 8, 2024, Monroe Capital and the Company entered a forbearance agreement such that the financial covenants described above are temporarily suspended through August 15, 2024, and access and ability to draw on the Revolving Loan Facility was confirmed. As part of the agreement, the Company agreed that any draw on the Revolving Loan Facility result in pro-forma cash of no more than $1 million after utilization of the drawn funds. Following the expiration of the forbearance agreement the Company would not likely be in compliance of its covenants and as a result the Company has classified all outstanding debt under the Monroe Credit Agreement as current.
Hewlett-Packard Factoring Agreement (Predecessor)
On October 16, 2019, an Amelia Component legal entity entered into a financing agreement with Hewlett Packard International Bank totaling approximately €9.9 million ($11 million). After debt issuance costs the Company received approximately €8.8 million ($9.7 million) of loan proceeds. The original repayment of the loan carried monthly installments of approximately €220 thousand ($260 thousand) commencing in February 2020 and ending in October 2023 and did not have a stated interest rate. During the last quarter of the year-ended December 31, 2020, certain terms of the loan were amended to extend the maturity date to October 2024 and modify the monthly payments to approximately €201 thousand ($238 thousand) commencing in March 2021.
26
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
The outstanding loan balance was paid in full on December 21, 2022, in conjunction with the Amelia Business Combination, resulting in a loss on settlement of approximately $279 thousand, recorded in other expense for the Successor period from December 21, 2022, through December 31, 2022.
Convertible Promissory Note (Predecessor)
On December 13, 2021, Amelia Holdings I LLC (a Predecessor legal entity), issued a convertible promissory note for an aggregate principal amount of $30.0 million (the Note) payable to BuildGroup LLC (BuildGroup). The note accrues interest at 11.00% per annum, is secured by a first lien on substantially all of the assets of the Predecessor Parent and is guaranteed by its Chief Executive Officer, Chetan Dube. The entire unpaid principal amount and all unpaid accrued interest was fully due and payable upon the earliest occurrence of the following:
•In the event that Amelia Holdings I LLC and Build Acquisition, 100% owned subsidiary of BuildGroup, enter into a definitive agreement to affect the Business Combination (Business Combination Agreement), the outstanding principal amount and all unpaid accrued interest thereon shall be due and payable on a date defined in the Business Combination Agreement,
•In the event that the Predecessor Parent and Build Acquisition have not entered into a Business Combination Agreement by March 31, 2022, outstanding principal amount and all unpaid accrued interest shall be due and payable on June 30, 2022, unless the Predecessor Parent and Build Acquisition are then continuing in good faith (as determined reasonably by Build Acquisition) to negotiate the Business Combination Agreement, in which case the Maturity Date shall be extended to September 30, 2022, or
•Irrespective of whether the Predecessor Parent and Build Acquisition have entered into a Business Combination Agreement, outstanding principal amount and all unpaid accrued interest shall be due and payable upon the occurrence of an event of default, in each case, unless sooner paid or converted in accordance with the terms herein.
In May 2022, the Company entered into an amendment to the Note such that the date by which the parties are to have entered into a Business Combination Agreement would be amended to June 30, 2022, and should that not be achieved, would establish a date upon which all outstanding principal and interest would be due of September 30, 2022. Additionally, the amendment requires the payment of a $2.0 million extension fee either upon maturity or repayment of the Note. The May 2022 amendment was accounted for as a modification and as such no gain or loss was recognized for this transaction. The $2.0 million extension fee payable to the lender was capitalized and amortized as a component of interest expense through the amended maturity date of September 30, 2022.
On September 30, 2022, the Note was extended as the Predecessor Parent and Build Group continued to negotiate the preferred share purchase agreement discussed in Note 12. On December 21, 2022, in conjunction with the Reorganization and Amelia Business Combination, Amelia Holdings and Build Group entered into a share purchase agreement whereby Build Group LLC was issued 3,654,170 shares of Series A-1 Preferred Stock of Amelia Holdings, based on a purchase price of $9.6928 per share, in exchange for contributing its note receivable from Amelia Holdings I LLC related to the Note and the note receivable received from Build Group effectively settled all amounts outstanding under the Note ($35.4 million) in conjunction with the Amelia Business Combination. As part of the share purchase agreement, Build Group was also granted Common Stock warrants for the purchase of 8,804,870 shares of the Company’s common stock at $9.6928 per share. The warrants carry an expiration date of December 21, 2032.
NOTE 8. LEASES
The Company has non-cancelable operating leases for several office spaces and technology-related equipment expiring through December 2025. Total rental expense for these office spaces and technology related equipment was $0.6 million, $30 thousand, and $0.9 million for the year ended December 31, 2023 (Successor period) and for the Successor period
27
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
from December 21, 2022 through December 31, 2022, and for the Predecessor period from January 1 through December 20, 2022, respectively.
The following table presents the consolidated balance sheet presentation of the Company’s right-of-use assets and related lease liabilities as of December 31, 2023 (Successor):
| Assets | ||||||||
Operating lease assets | Right of use assets, net | $ | 353,186 | |||||
Total lease assets | $ | 353,186 | ||||||
| Liabilities | ||||||||
| Current: | ||||||||
Operating lease liabilities | Short-term lease obligations | $ | 230,451 | |||||
Non-current | ||||||||
Operating lease liabilities | Other non-current liabilities | 139,691 | ||||||
Total lease liabilities | $ | 370,142 | ||||||
As of December 31, 2023, maturities of future operating lease liabilities are as follows:
| 2024 | $ | 259,087 | |||
| 2025 | 131,282 | ||||
| 2026 | 7,628 | ||||
| Thereafter | — | ||||
Total future lease payments | 397,997 | ||||
Less: imputed interest | (27,855) | ||||
| $ | 370,142 | ||||
Terms under the Company’s operating leases are recognized as rent expense in the consolidated and combined statements of operations and comprehensive loss on a straight-line basis. Amounts received from subleases are presented in other income (expense), net in the consolidated and combined statements of operations and comprehensive loss.
Subsequent to the Amelia Business Combination, the Company is expected to continue to occupy certain floors leased by the Predecessor Parent on a month-to-month basis until the landlord approves the sublease of these floors to the Company. Additionally, the Company continued to pay rent on behalf of the Predecessor Parent with all payments reducing amounts owed to the Predecessor Parent under the CVR Agreement in connection with the Amelia Business Combination (see Note 3) during 2023. The Company was charged $2.7 million, $0.1 million, and $7.1 million for the use of office space leased by the Predecessor Parent for the year ended December 31, 2023 (Successor), and from December 21, 2022 through December 31, 2022 (Successor), and from January 1 through December 20, 2022 (Predecessor), respectively.
NOTE 9. RETIREMENT PLANS
The Company offers defined contribution plans to eligible employees. These plans are offered in the following jurisdictions: US, Australia, Canada, France, Germany, Japan, Netherlands, Norway, Slovakia, Spain, Sweden, and the UK. The Company has no additional liability beyond its contributions. The participants in the plan can direct their contributions to numerous investment options. The Company’s contribution cost for the year ended December 31, 2023 (Successor period), and for the Successor period from December 21, 2022 through December 31, 2022, and or the Predecessor period from January 1 through December 20, 2022, amounted to $3.3 million, zero, and $2.4 million, respectively, and is included in the consolidated and combined statements of operations and comprehensive loss.
28
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
The Company is statutorily required to provide post-employee benefits for eligible employees in India. The annual cost of these benefits is based upon a specific actuarial computation which is followed consistently. The overall financial impact to the Company’s financial position, operations, and cash flows of this plan is immaterial.
NOTE 10. INCOME TAXES
The following is a geographical breakdown of income (loss) before income taxes:
| Successor | Predecessor | |||||||||||||||||||||||||
| Year ended December 31, 2023 | Period from December 21, 2022 to December 31, 2022 | Period from January 1, 2022 through December 20, 2022 | ||||||||||||||||||||||||
| Domestic | $ | (55,186,977) | $ | (11,910,609) | $ | (33,005,266) | ||||||||||||||||||||
| Foreign | (10,746,916) | 304,209 | (6,418,707) | |||||||||||||||||||||||
| $ | (65,933,893) | $ | (11,606,400) | $ | (39,423,973) | |||||||||||||||||||||
Income tax expense (benefit) consisted of the following for the following periods:
| Successor | Predecessor | |||||||||||||||||||
| Period from | Period from January 1, 2022 | |||||||||||||||||||
| Year Ended | December 21, 2022 | through | ||||||||||||||||||
| December 31, | to December 31, | December 20, | ||||||||||||||||||
| 2023 | 2022 | 2022 | ||||||||||||||||||
| Current tax expense (benefit): | ||||||||||||||||||||
US Federal | $ | — | $ | — | $ | — | ||||||||||||||
US State and Local | 33,903 | — | 203,043 | |||||||||||||||||
Foreign | 358,783 | — | 323,220 | |||||||||||||||||
| 392,686 | — | 526,263 | ||||||||||||||||||
| Deferred tax expense (benefit): | ||||||||||||||||||||
US Federal | — | — | — | |||||||||||||||||
US State and Local | — | — | (2) | |||||||||||||||||
Foreign | 102,614 | — | 23,078 | |||||||||||||||||
| 102,614 | — | 23,076 | ||||||||||||||||||
| Income tax expense | $ | 495,300 | $ | — | $ | 549,339 | ||||||||||||||
29
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
A reconciliation of the provision (benefit) for income taxes with amounts determined by applying the statutory U.S. federal income tax rate to income before income taxes is as follows:
| Successor | Predecessor | |||||||||||||||||||||||||
| Year ended December 31, 2023 | Period from December 21, 2022 to December 31, 2022 | Period from January 1, 2022 through December 20, 2022 | ||||||||||||||||||||||||
| Computed tax at the federal statutory rate of 21% | $ | (13,846,118) | $ | (2,437,344) | $ | (8,279,034) | ||||||||||||||||||||
| State taxes | 33,904 | — | 203,043 | |||||||||||||||||||||||
| Foreign rate differential | 2,718,248 | (63,884) | 1,694,224 | |||||||||||||||||||||||
| Non-deductible expenses | 27,062 | 1,575,797 | 180,203 | |||||||||||||||||||||||
Valuation allowance and other | 11,562,203 | 925,431 | 6,750,903 | |||||||||||||||||||||||
| Provision (benefit) for income taxes | $ | 495,300 | $ | — | $ | 549,339 | ||||||||||||||||||||
| Effective income tax rate | -1% | -% | -1% | |||||||||||||||||||||||
The difference between the federal statutory rate of 21% and the Successor’s effective tax rate for the year ended December 31, 2023, is primarily due to an increase in the valuation allowance. The difference between the federal statutory rate of 21% and the Successor’s effective tax rate for the period from December 21, 2022 to December 31, 2022 is primarily due certain permanent differences relating to transaction costs related to the Amelia Business Combination. The difference between the federal statutory rate of 21% and the Predecessor’s effective tax rate for the period from January 1, 2022 to December 20, 2022 is primarily due and an increase in the valuation allowance.
30
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
Deferred tax assets and liabilities are recognized for the expected future taxation of events that have been reflected in the Consolidated Financial Statements. Deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and the tax bases of reported assets and liabilities using tax rates in effect for the years in which the differences are expected to reverse. The tax effects of temporary differences that comprise the deferred income tax amounts shown on the consolidated balance sheet are as follows for the years ended December 31:
Successor | |||||||||||
| December 31, | |||||||||||
| 2023 | 2022 | ||||||||||
Deferred tax assets: | |||||||||||
Net operating losses | $ | 11,105,482 | $ | 5,682,559 | |||||||
Foreign credit carryforwards | 102,045 | — | |||||||||
Deferred revenue | 8,764,060 | 10,016,093 | |||||||||
Fixed assets | 1,978,364 | 2,127,448 | |||||||||
Capitalized R&D costs | 1,692,659 | 125,659 | |||||||||
| Interest | 3,873,444 | 536,652 | |||||||||
| Other | 6,014,429 | 1,518,498 | |||||||||
Total deferred tax assets | 33,530,484 | 20,006,909 | |||||||||
Less: valuation allowance | (27,574,672) | (14,229,074) | |||||||||
Deferred tax asset, net of valuation allowance | 5,955,812 | 5,777,835 | |||||||||
Deferred tax liabilities: | |||||||||||
| Reserves | (933,064) | (778,942) | |||||||||
| Intangibles | (17,740,409) | (17,200,484) | |||||||||
Total deferred tax liabilities | (18,673,474) | (17,979,426) | |||||||||
| Net deferred tax liability | $ | (12,717,662) | $ | (12,201,591) | |||||||
In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in those periods in which temporary differences become deductible and/or net operating loss carryforwards can be utilized. We consider the level of historical taxable income, scheduled reversal of temporary differences, tax planning strategies and projected future taxable income in determining whether a valuation allowance is warranted. Significant weight is given to positive and negative evidence that is objectively verifiable. The Company evaluates the realizability of deferred tax assets on a jurisdictional basis at each reporting date. The Company’s valuation allowance increased by $13,345,597 for the year ended December 31, 2023.
As of December 31, 2023, the Company has U.S. federal and state gross operating losses of $48.7 million and foreign gross operating losses of $95.7 million. As of December 31, 2022, the Company has U.S. federal and state gross operating losses of $5.5 million and foreign gross operating losses of $93.7 million. The U.S federal net operating losses have an indefinite carryforward period. The Company has various foreign net operating loss carryforwards and state net operating loss carryforwards that expire in various years beginning in tax year 2030.
As of December 31, 2023, and 2022 (Successor), there were recorded uncertain tax positions of $18.7 million and $18.7 million, respectively primarily related to an internal global restructuring that was effectuated in 2021. These unrecognized tax benefits, if recognized, would not affect the effective tax rate.
The Predecessor’s results are included in tax returns filed by the Predecessor Parent in the United States and various state and foreign jurisdictions with varying statute of limitations. Various domestic and foreign tax years remain open for examination by tax authorities.
31
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
No jurisdictions are currently under audit by the IRS, state, or foreign authorities.
U.S. income tax has not been recognized on the excess of the amount for financial reporting over the basis of investments in foreign subsidiaries that is reinvested outside the United States. This amount becomes taxable upon a repatriation of assets from the subsidiary of a sale or liquidation of the subsidiary. Determination of the amount of any unrecognized deferred income tax liability on the temporary differences is not practicable because of the complexities of the hypothetical calculation.
NOTE 11. COMMITMENTS AND CONTINGENCIES
Litigation and Legal Proceedings
The Company accrues contingent liabilities, including estimated legal costs, when the obligation is probable, and the amount is reasonably estimable. As facts concerning contingencies become known, the Company reassesses its position and makes appropriate adjustments to the consolidated financial statements. Estimates that are particularly sensitive to future changes include those related to tax, legal and other regulatory matters, changes in interpretation and enforcement of international laws, and the impact of local economic conditions and practices, which are all subject to change as events evolve and as additional information becomes available during the administrative and litigation process.
As of December 31, 2023, the Company was involved in litigation arising in the normal course of business that is pending. The results of the proceedings are not expected to have a material adverse effect on the Company’s consolidated financial position or results of operations and comprehensive loss. Actual outcomes of these legal and regulatory proceedings may differ materially from our current estimates. It is possible that resolution of one or more of the legal matters currently pending or threatened could result in losses material to our consolidated results of operations, liquidity, or financial condition.
Warranties
The Company’s offerings come with a warranty to perform in a manner consistent with general industry standards. We establish an accrual based on an evaluation of the known service disruptions. To date, the Company has not incurred material costs because of its warranties. There are no accrued liabilities related to these obligations on the consolidated financial statements.
NOTE 12. RELATED-PARTY TRANSACTIONS
During the Predecessor period from January 1 through December 20, 2022, the Company incurred $1.4 million of costs on behalf of a company controlled by the Class B stockholder (Predecessor Parent) for hosting corporate functions, organizing staff events, and providing serviced apartments. During the year ended December 31, 2023 (Successor Period) and for the Successor Period from December 21, 2022 through December 31, 2022, none of these costs were incurred.
During the Predecessor period from January 1 through December 20, 2022, the Company incurred $270 thousand of costs paid to entities owned by relatives of the Class B stockholder (Predecessor Parent) for commissions and advisory services in relation to the telecommunication industry. During the year ended December 31, 2023 (Successor period) and for the Successor Period from December 21, 2022 through December 31, 2022, none of these costs were incurred.
In connection with the Amelia Business Combination, the Successor and Predecessor entities entered into a transition service agreement to support the provision by the Successor entity of customer support services within the United Kingdom and Germany as well as certain administrative services related to the collection of trade receivables on behalf of the Predecessor entity. During the Successor periods from December 21, 2022 through December 31, 2022 and January 1, 2023 through December 31, 2023 the Company incurred charges of $0 and $2.8 million, which are recorded within cost of revenues in the consolidated and combined statements of operations and comprehensive loss. As of December 31, 2023 and 2022, $1.4 million and $0, respectively, was accrued related to these activities and is presented as due to related party on the consolidated balance sheets.
32
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
Employee loans totaled $472 thousand and $359 thousand as of December 31, 2023 and 2022 (Successor), respectively, and were recorded within prepaid expenses and other current assets on the consolidated balance sheets.
NOTE 13. FAIR VALUE MEASUREMENT
At December 31, 2023 and 2022 (Successor), the Company held Level 1 financial assets related to treasury bills measured at fair value on a recurring basis of $10.1 million and zero, respectively. There were no Level 1 financial liabilities measured or disclosed at fair value on a recurring basis as of December 31, 2023 and 2022.
The Company did not hold any Level 2 financial assets or liabilities that were measured or disclosed at fair value on a recurring basis as of December 31, 2023 and 2022.
At December 31, 2023 and 2022 (Successor), the Company held Level 3 financial liabilities related to the CVR and warrant liabilities measured at fair value on a recurring basis of $14.3 million and $13.7 million, respectively. There were no Level 3 financial assets measured or disclosed at fair value on a recurring basis as of December 31, 2023 and 2022.
NOTE 14. STOCKHOLDERS’ EQUITY AND PREFERRED STOCK
During December 2022, the Company entered into a share purchase agreement as a result of which the authorized and issued capital of the Company consists of:
Common Stock
The Company is authorized to issue 253,933,170 shares of Common Stock, of which 153,933,170 shares have been designated Class A Common Stock, $0.001 par value per share, none of which are issued and outstanding as of December 31, 2023 and 2022.
On December 21, 2022, 100,000,000 shares have been designated Class B Common Stock, $0.001 par value per share, 100,000,000 shares of which are issued and outstanding on December 31, 2023 and 2022, and are held by the Predecessor Parent.
Shares of Class A Common Stock and Class B Common Stock have the same rights and powers, rank equally; provided that the voting, dividend and liquidation rights of the holders of the Common Stock are subject to and qualified by the rights, powers and preferences of the holders of the Preferred Stock, as described below.
Each share of Class B Common Stock shall be automatically, without further action by the holder thereof, converted into one (1) fully paid and non-assessable share of Class A Common Stock, upon (i) the occurrence of a transfer of such share of Class B Common Stock or (ii) an initial public offering (“IPO”).
As described in Note 1, the Common Stockholder has the right, but not the obligation, to redeem all shares of Senior Series A Preferred Stock held at a per share purchase price equal to the 175% of the applicable stated value then in effect with respect to such share of Series A Preferred Stock on the one-year anniversary of the issuance date (Common Stockholder Call Option). Pursuant to agreement the call option closing date shall occur no later than 90 days from the date of the call notice. The Common Stockholder exercised the call option at the one-year anniversary date and the closing failed to occur within the 90 day period and as such the call right of the Common Stockholder Call Option terminated on March 31, 2024.
Preferred Stock
The Company is authorized to issue 16,034,483 shares of Preferred Stock, of which 3,654,170 shares have been designated Series A-1 Preferred Stock, 4,126,771 shares have been designated Series A-2 Preferred Stock, 4,126,771 shares have been designated Series A-3 Preferred Stock (together, “Senior Series A Preferred Stock”) and 4,126,771 shares have been designated Series A-4 Preferred Stock, $0.001 par value per share. On December 21, 2022, 3,654,170 series A-1 Preferred
33
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
Stock shares and 4,126,771 Series A-2 Preferred Stock shares were issued and are held by one shareholder (Build Group), which are outstanding at December 31, 2023 and 2022 (Successor). There are no shares of A-3 or A-4 Preferred Stock outstanding at December 31, 2023 and 2022 (Successor).
The Series A-1 Preferred Stock shareholder has an option to purchase on the same terms and conditions up to $40.0 million in aggregate original issue price of additional shares of Series A-3 Preferred Stock provided that a Qualified Financing is consummated before June 30, 2023. No Qualified Financing Event occurred resulting in the expiration of this option.
Preferred Stock shares are convertible into class A common shares at a conversion price equal to the stated value per share of Series A Preferred Stock (initial stated value of Series A Preferred Stock is $9.6928). The conversion price is subject to adjustment based on issuance of additional shares of Class A common stock for no consideration or consideration per share less than the applicable conversion price. The conversion price is also subject to adjustment for standard anti-dilution provisions, and potential adjustment based on an effective offering price underlying an initial public offering. The shares may become mandatorily convertible upon the closing of a qualified public offering.
The preferred stock do not have a mandatory redemption date and were assessed at issuance for classification and redemption features requiring bifurcation. The Company presents as temporary equity any stock which (i) the Company undertakes to redeem at a fixed or determinable price on the fixed or determinable date or dates; (ii) is redeemable at the option of the holders, or (iii) has conditions for redemption which are not solely within the control of the Company, as described below.
The Senior Series A Preferred Stock has the right, but not the obligation, to put the Senior Series A Preferred Stock held back to the Company at a per share purchase price equal to the 175% of the applicable stated value then in effect with respect to such share of Senior Series A Preferred Stock on the one-year anniversary of the issuance date (initial redemption) or to put all shares of Senior Series A Preferred Stock held at a per share purchase price equal to the 300% of the applicable stated value then in effect with respect to such share of Senior Series A Preferred Stock beginning on the fourth anniversary of the issuance date (full redemption). The holders of the Series A Preferred Stock did not exercise their put option at the one-year anniversary date of the Series A Preferred Stock issuance date.
The redeemable convertible preferred stock is redeemable at the option of the holders which the Company determined is not solely within its control and thus has classified shares of redeemable convertible preferred stock as temporary equity until such time as the conditions are removed or lapse. The preferred stock which includes redemption features that are exercisable solely based on the passage of time are probable of becoming redeemable. The Company has determined the redemption amount and measured the securities at the highest of those amounts.
Pursuant to the election of the Senior Series A Preferred Stockholders to exercise either the initial or full redemption, the Common Stockholder has the right, but not the obligation, to redeem all shares of Senior Series A Preferred Stock held at a per share purchase price equal to the 175% of the applicable stated value then in effect with respect to such share of Series A Preferred Stock on the one-year anniversary of the issuance date (initial redemption) or to redeem all shares of Series A-1, A-2 or A-3 Preferred Stock held at a per share purchase price equal to the 300% of the applicable stated value then in effect with respect to such share of Series A Preferred Stock beginning on the fourth anniversary of the issuance date (full redemption).
The Series A-4 shares may be redeemed beginning on the fifteenth anniversary of their issuance date based on the original issuance price of those Series A-4 shares.
Dividends for Senior Series A Preferred Stock compound annually and accrue at the rate per annum of eleven percent (11%) of the stated value of such share then in effect. Dividends accrue daily and are cumulative. Dividends are automatically deemed to be paid in kind, and the stated value with respect to each share of Senior Series A Preferred Stock is correspondingly increased by the accruing dividend, on a daily basis, and will not be paid by the Company in cash or in Common Stock. For the year ended December 31, 2023 (Successor), the stated value of the Senior Series A Preferred Stock increased by $9.2 million because of the accruing dividend.
34
AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
The holders of the Series A-4 Preferred Stock are entitled to receive, on a pari passu basis with the holders of the Common Stock, when, as, and if declared by the Board, out of any assets of the Corporation legally available therefore, such dividends as may be declared from time to time by the Board.
Voting Rights
Each holder of Class A Common Stock has the right to one (1) vote per share of Class A Common Stock held of record by such holder and each holder of Class B Common Stock has the right to ten (10) votes per share of Class B Common Stock held of record by such holder.
Each holder of outstanding shares of Senior Series A Preferred Stock is entitled to cast the number of votes equal to the number of whole shares of Class A Common Stock into which the shares of Senior Series A Preferred Stock held by such holder are convertible as of the record date for determining stockholders entitled to vote on such matter. Holders of Senior Series A Preferred Stock vote together with the holders of Common Stock as a single class and on an as converted to Class A Common Stock basis.
Each holder of outstanding shares of Series A-4 Preferred Stock shall have no voting right on any matter presented to the stockholders of the Company.
Right to Receive Liquidation Distribution
In the event of liquidation, dissolution or winding up of the Company, after the satisfaction of all amounts due under the Monroe Credit Agreement, holders of the Senior Series A Preferred Stock will be eligible for preferential payment out of the assets of the Company over the holders of the other share classes.
Common Stock Warrants
In connection with the conversion of the convertible promissory note to Series A-1 Preferred Stock and the purchase of Series A-2 Preferred Stock, the Company issued 8,804,870 of Common Stock warrants, $0.001 par value per share, which expire on December 31, 2032, to the Series A-1 Stockholder. The number of Common Stock warrants may increase by up 745,288 shares to 9,550,158 in total in the event that, and in proportion with, Series A-3 or Series A-4 Preferred Stock are subsequently issued. The Common Stock warrants each have an exercise price of $9.6928 per share, subject to certain adjustments, and may be exercised in whole or in part at any time prior to December 21, 2032, including on a cash or cashless exercise basis.
All Common Stock warrants remain unexercised and outstanding as of December 31, 2023 (Successor), and there were 8,804,870 Common Stock warrants outstanding as of December 31, 2023 (Successor).
The Common Stock warrants are classified within other non-current liabilities on the consolidated balance sheet as of December 31, 2023 (Successor) and were valued using an option pricing model. Changes in fair value are recognized through earnings within other income (expense), net on the consolidated and combined statements of operations and comprehensive loss.
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AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
The following is a roll forward of the fair value of the Common Stock warrants for the periods from January 1, 2022 through December 20, 2022 (Predecessor), December 21, 2022 through December 31,2022 (Successor) and for the year ended December 31, 2023:
| Balance on January 1, 2022 (Predecessor) | $ | — | |||
| Issuance of common stock warrants at fair value on December 21, 2022 (Successor) | 132,073 | ||||
| Change in fair value | — | ||||
| Balance on December 31, 2022 (Successor) | 132,073 | ||||
| Change in fair value | 924,511 | ||||
| Balance on December 31, 2023 | $ | 1,056,584 | |||
Preferred Stock Warrants
As part of the Monroe Credit Agreement, Monroe received 812,458 Series A-2 Preferred Stock warrants having a ten-year term that expires on December 21, 2032. The number of Series A-2 Preferred Stock shares that may be issued upon exercise is subject to increase based on adjustment to reduce the exercise price per share. The exercise price is equal to the lower of (a) the initial stated value of Series A Preferred Stock of $9.6928 per share and (b) 80% of the lowest price per share at which (i) the preferred equity of the Company is sold in the Company’s most recent Equity Financing (as defined in the preferred warrant agreement) or (ii) the common stock of the Company is being purchased in an Acquisition (as defined in the preferred warrant agreement). The Series A-2 Preferred Stock Warrants may be exercised in whole or in part at any time prior to December 21, 2032, including on a cash or cashless exercise basis.
All Series A-2 Preferred Stock warrants remain unexercised and outstanding as of December 31, 2023 (Successor), and there were 812,458 Preferred Stock warrants outstanding as of December 31, 2023 (Successor).
The Series A-2 Preferred Stock warrants were valued using a Monte-Carlo valuation method and recorded as preferred warrant liability within other non-current liabilities on the consolidated balance sheet. Changes in fair value are recognized through earnings within other income (expense), net on the consolidated and combined statements of operations and comprehensive loss.
The following is a roll forward of the fair value of the Series A-2 Preferred Stock warrants for the periods from January 1, 2022 through December 20, 2022 (Predecessor), December 21, 2022 through December 31,2022 (Successor) and for the year ended December 31, 2023:
| Balance on January 1, 2022 (Predecessor) | $ | — | |||
| Issuance of preferred stock warrants at fair value on December 21, 2022 (Successor) | 2,974,409 | ||||
| Change in fair value | — | ||||
| Balance on December 31, 2022 (Successor) | 2,974,409 | ||||
| Change in fair value | 608,531 | ||||
| Balance on December 31, 2023 | $ | 3,582,940 | |||
NOTE 15. SALE OF BUSINESS UNIT
On December 1, 2023, the Company completed a sale of its subsidiary in Slovakia along with certain employees from India. Total proceeds received from the sale amounted to $1.3 million. The Company derecognized net assets of $0.1 million and recognized a pre-tax gain on the sale in the amount of $1.2 million which is reported within other income (expense), net on the consolidated and combined statements of operations and comprehensive loss.
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AMELIA HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
NOTE 16. SUBSEQUENT EVENTS
In accordance with ASC 855, Subsequent Events, the Company evaluated subsequent events through October 22, 2024, the date these consolidated financial statements were available to be issued.
The Company utilized its Delayed Draw Term Loan Facility (Note 6) through March 31, 2024 and drew down on the facility in the amount of $6.0 million.
In January 2024, the Company instituted and adopted the 2024 Equity Incentive Plan (the 2024 Plan) whereby the Company may grant equity-based incentive awards to its employees, directors and consultants pursuant to the 2024 Plan. A total of 22,470,959 shares of the Company’s Class A Common Stock is reserved for sale and issuance under the 2024 Plan. In April 2024, pursuant to the 2024 Plan, the Company issued options to purchase 12,301,329 shares of the Common A shares of the Company with a strike price of $0.40 per share, and four-year vesting.
On June 30, 2024, the CVR was converted to 3,765,280 shares of Series A-4 Preferred Stock.
On August 6, 2024, SoundHound AI, Inc. (“SoundHound”) completed its acquisition of all the issued and outstanding shares of the Company pursuant to the stock purchase agreement by and among SoundHound, IPSoft Global Holdings, Inc., and BuildGroup, LLC. As a result of the acquisition, awards granted under the 2024 Plan were cancelled in exchange for no consideration.
Concurrent with the acquisition, the Company entered into a Second Amendment to the Monroe Credit Agreement and SoundHound paid $70 million to retire a majority of the Monroe Term Loan leaving a remaining balance of $39.69 million with a maturity date of June 30, 2026.
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