UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

GRAF ACQUISITION CORP. IV

(Exact name of registrant as specified in its charter)

Delaware

001-40427

86-2191918

(State or other jurisdiction of

incorporation or organization)

(Commission
File Number)

(I.R.S. Employer

Identification Number)

, Texas

1790 Hughes Landing Blvd., Suite 400

The Woodlands, Texas

77380

(Address of principal executive offices)

(Zip Code)

(346) 442-0819 (Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Units, each consisting of one share of common stock and one-fifth of one redeemable warrant	GFOR.U	The New York Stock Exchange
Common stock, par value $0.0001 per share	GFOR	The New York Stock Exchange
Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50 per share	GFOR WS	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	◻	Accelerated filer	◻
Non-accelerated filer	⌧	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ⌧ No ◻

As of August 13, 2021, 21,452,875 shares of common stock, par value $0.0001, were issued and outstanding.


		Page No.
PART I. FINANCIAL INFORMATION

Item 1.	Condensed Financial Statements	1

	Unaudited Condensed Balance Sheet as of June 30, 2021	1

	Unaudited Condensed Statements of Operations for the three months ended June 30, 2021 and for the period from January 28, 2021 (inception) through June 30, 2021	2

	Unaudited Condensed Statements of Changes in Stockholders’ Equity (Deficit) for the three months ended June 30, 2021 and for the period from January 28, 2021 (inception) through June 30, 2021	3

	Unaudited Condensed Statement of Cash Flows for the period from January 28, 2021 (inception) through June 30, 2021	4

	Notes to Unaudited Condensed Financial Statements	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24

Item 4.	Controls and Procedures	24

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	24

Item 1A.	Risk Factors	24

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities	24

Item 3.	Defaults Upon Senior Securities	25

Item 4.	Mine Safety Disclosures	25

Item 5.	Other Information	25

Item 6.	Exhibits	26

SIGNATURES		27


Assets:
Current assets:
Cash	$	2,011,777
Prepaid expenses		1,108,280
Total current assets		3,120,057
Investments held in Trust Account		171,615,136
Total assets	$	174,735,193

Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	17,222
Accrued expenses		165,354
Franchise tax payable		66,874
Accrued expenses - related party		18,387
Total current liabilities		267,837
Derivative warrant liability		11,095,603
Deferred underwriting commissions in connection with the initial public offering		6,006,525
Total Liabilities		17,369,965

Commitments and Contingencies

Common stock; 15,236,522 shares subject to possible redemption at $10.00 per share		152,365,220

Stockholders' Equity:
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; no shares issued and outstanding		—
Common stock, $0.0001 par value; 400,000,000 shares authorized; 6,216,353 shares issued and outstanding (excluding 15,236,522 shares subject to possible redemption)		622
Additional paid-in capital		9,345,095
Accumulated deficit		(4,345,709)
Total stockholders' equity		5,000,008
Total Liabilities and Stockholders' Equity	$	174,735,193


			For the Period from
	For the		January 28, 2021
	Three Months Ended		(inception) through
	June 30,		June 30,
	2021		2021
General and administrative expenses	$	211,156	$	212,808
General and administrative expenses - related party		18,387		18,387
Franchise tax expenses		32,851		66,873
Loss from operations		(262,394)		(298,068)

Other income (expenses):
Offering costs - derivative warrant liability		(34,474)		(34,474)
Change in fair value of derivative warrant liability		141,647		141,647
Income from investments held in Trust Account		136		136
Loss upon issuance of private placement warrants		(4,154,950)		(4,154,950)
Total other expenses		(4,047,641)		(4,047,641)

Net loss	$	(4,310,035)	$	(4,345,709)

Weighted average shares outstanding of redeemable common stock		16,567,088		16,567,088

Basic and diluted net income per share, redeemable common stock	$	0.00	$	0.00

Weighted average shares outstanding of non-redeemable common stock		3,922,526		3,863,767

Basic and diluted net loss per share, non-redeemable common stock	$	(1.10)	$	(1.12)


				Additional				Total
	Common Stock			Paid-In		Accumulated		Stockholders'
	Shares	Amount		Capital		Deficit		Equity (Deficit)
Balance - January 28, 2021 (inception)	—	$	—	$	—	$	—	$	—
Issuance of common stock to Sponsor	4,312,500		431		24,569		—		25,000
Net loss	—		—		—		(35,674)		(35,674)
Balance - March 31, 2021 (unaudited)	4,312,500		431		24,569		(35,674)		(10,674)
Sale of units in initial public offering, less fair value of derivative warrant liability	17,161,500		1,716		171,613,284		—		171,615,000
Offering costs	—		—		(9,929,063)		—		(9,929,063)
Common stock subject to possible redemption	(15,236,522)		(1,523)		(152,363,697)		—		(152,365,220)
Common stock forfeited	(21,125)		(2)		2		—		—
Net loss	—		—		—		(4,310,035)		(4,310,035)
Balance - June 30, 2021 (unaudited)	6,216,353	$	622	$	9,345,095	$	(4,345,709)	$	5,000,008


Cash Flows from Operating Activities:
Net loss	$	(4,345,709)
Adjustments to reconcile net loss to net cash used in operating activities:
General and administrative expenses paid by related party in exchange for issuance of common stock		(140,647)
General and administrative expenses paid by related party under promissory note		1,980
Offering costs - derivative warrant liability		34,474
Income from investments held in Trust Account		(136)
Loss upon issuance of private placement warrants		4,154,950
Change in operating liabilities:
Prepaid expenses		(1,108,280)
Accrued expenses		84,817
Accounts payable		17,222
Franchise tax payable		66,874
Net cash used in operating activities		(1,234,455)

Cash Flows from Investing Activities
Cash deposited in Trust Account		(171,615,000)
Net cash used in investing activities		(171,615,000)

Cash Flows from Financing Activities:
Proceeds from note payable to related party		500
Repayment of note payable to related party		(69,808)
Proceeds received from initial public offering, gross		171,615,000
Proceeds received from private placement		7,082,300
Offering costs paid		(3,766,760)
Net cash provided by financing activities		174,861,232

Net change in cash		2,011,777

Cash - beginning of the period		—
Cash - end of the period	$	2,011,777

Supplemental disclosure of noncash activities:
Offering costs paid by Sponsor in exchange for issuance of common stock	$	24,000
Offering costs included in accrued expenses	$	98,924
Offering costs paid by related party under promissory note	$	67,327
Deferred underwriting commissions in connection with the initial public offering	$	6,006,525
Initial value of common stock subject to possible redemption	$	132,282,160
Change in value of common stock subject to possible redemption	$	20,083,060


	For the Three Months Ended		For the Period from January 28, 2021
	June 30, 2021		(inception) through June 30, 2021
Redeemable common stock
Numerator: Income allocable to redeemable common stock
Income from investments held in Trust Account	$	136	$	136
Less: Company's portion available to be withdrawn to pay taxes		(136)		(136)
Net income attributable to redeemable common stock	$	—	$	—
Denominator: Weighted average redeemable common stock
Basic and diluted weighted average shares outstanding, redeemable common stock		16,567,088		16,567,088
Basic and diluted net income per share, redeemable common stock	$	0.00	$	0.00
Non-redeemable common stock
Numerator: Net loss minus net income allocable to redeemable common stock
Net loss	$	(4,310,035)	$	(4,345,709)
Net income allocable to redeemable common stock		—		—
Net loss attributable to non-redeemable common stock	$	(4,310,035)	$	(4,345,709)
Denominator: Weighted average non-redeemable common stock
Basic and diluted weighted average shares outstanding, non-redeemable common stock		3,922,526		3,863,767
Basic and diluted net loss per share, non-redeemable common stock	$	(1.10)	$	(1.12)


	Quoted Prices in		Significant Other		Significant Other
	Active Markets		Observable Inputs		Unobservable Inputs
Description	(Level 1)		(Level 2)		(Level 3)
Assets - Investments held in Trust Account:

Money market fund	$	171,615,136	$	—	$	—
Liabilities
Derivative Warrant liability- Private warrants	$	—	$	—	$	11,095,603


	At issuance			June 30, 2021
Exercise price	$	11.50		$	11.50
Share price	$	9.93		$	9.95
Expected term (years)		6.59			6.49
Volatility		29.50	%		29.60	%
Risk-free rate		1.20	%		1.12	%
Dividend yield (per share)		0.00	%		0.00	%


Derivative warrant liability at January 28, 2021 (inception)	$	—
Derivative warrant liability at March 31, 2021		—
Issuance of Private Warrants		10,551,330
Issuance of Private Warrants - over-allotment		685,920
Change in fair value of warrant liabilities		(141,647)
Derivative warrant liability at June 30, 2021	$	11,095,603


Exhibit Number		Description

31.1		Certification of Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit)


	GRAF ACQUISITION CORP. IV

	By:	/s/ James A. Graf
	Name:	James A. Graf
	Title:	Chief Executive Officer

SEC Form 10-Q filed by Graf Acquisition Corp. IV