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 September 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 November 15, 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 September 30, 2021	1

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

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

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

	Notes to Unaudited Condensed Financial Statements	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22

Item 4.	Controls and Procedures	22

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	23

Item 1A.	Risk Factors	23

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities	23

Item 3.	Defaults Upon Senior Securities	23

Item 4.	Mine Safety Disclosures	23

Item 5.	Other Information	24

Item 6.	Exhibits	25

SIGNATURES		26


Assets:
Current assets:
Cash	$	1,894,355
Prepaid expenses		952,550
Total current assets		2,846,905
Investments held in Trust Account		171,636,419
Total assets	$	174,483,324

Liabilities, Common Stock Subject to Possible Redemption and Stockholders' Deficit:
Current liabilities:
Accounts payable	$	34,745
Accrued expenses		630,291
Franchise tax payable		133,698
Total current liabilities		798,734
Derivative warrant liability		5,618,625
Deferred underwriting commissions in connection with the initial public offering		6,006,525
Total Liabilities		12,423,884

Commitments and Contingencies (Note 5)

Common stock subject to possible redemption; 17,161,500 shares at $10.00 per share		171,615,000

Stockholders' Deficit:
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; 4,291,375 shares issued and outstanding		429
Additional paid-in capital		—
Accumulated deficit		(9,555,989)
Total stockholders' deficit		(9,555,560)
Total Liabilities, Common Stock Subject to Possible Redemption and Stockholders' Deficit	$	174,483,324



			For the Period from
	For the Three		January 28, 2021
	Months Ended		(inception) through
	September 30, 2021		September 30, 2021
General and administrative expenses	$	692,224	$	905,032
General and administrative expenses - related party		45,000		63,387
Franchise tax expenses		66,825		133,698
Loss from operations		(804,049)		(1,102,117)

Other income (expenses):
Offering costs - derivative warrant liability		—		(34,474)
Change in fair value of derivative warrant liability		5,476,978		5,618,625
Income from investments held in Trust Account		21,283		21,419
Loss upon issuance of private placement warrants		—		(4,154,950)
Total other income		5,498,261		1,450,620

Net income	$	4,694,212	$	348,503

Weighted average shares outstanding of common stock, basic		21,452,875		13,584,991
Basic net income per share, common stock	$	0.22	$	0.03
Weighted average shares outstanding of common stock, diluted		21,452,875		13,841,555
Diluted net income per share, common stock	$	0.22	$	0.03


								Total
	Common Stock			Additional Paid-In		Accumulated		Stockholders'
	Shares	Amount		Capital		Deficit		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)
Common stock forfeited	(21,125)		(2)		2		—		—
Fair value of Public Warrants included in the Units sold in the Initial Public Offering	—		—		7,894,290		—		7,894,290
Offering costs associated with issuance of Public Warrants	—		—		(434,186)		—		(434,186)
Accretion to common stock subject to possible redemption amount	—		—		(7,484,675)		(9,904,492)		(17,389,167)
Net loss	—		—		—		(4,310,035)		(4,310,035)
Balance - June 30, 2021 (unaudited)	4,291,375		429		—		(14,250,201)		(14,249,772)
Net income	—		—		—		4,694,212		4,694,212
Balance - September 30, 2021 (unaudited)	4,291,375	$	429	$	—	$	(9,555,989)	$	(9,555,560)


Cash Flows from Operating Activities:
Net income	$	348,503
Adjustments to reconcile net income to net cash used in operating activities:
Change in fair value of derivative warrant liability		(5,618,625)
General and administrative expenses paid by related party in exchange for issuance of common stock		1,000
General and administrative expenses paid by related party under promissory note		1,981
Offering costs - derivative warrant liability		34,474
Income from investments held in Trust Account		(21,419)
Loss upon issuance of private placement warrants		4,154,950
Change in operating liabilities:
Prepaid expenses		(952,550)
Accrued expenses		531,367
Accounts payable		34,745
Franchise tax payable		133,698
Net cash used in operating activities		(1,351,876)

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		(69,809)
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		174,861,231

Net change in cash		1,894,355

Cash - beginning of the period		—
Cash - end of the period	$	1,894,355

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


Gross proceeds from Initial Public Offering	$	171,615,000
Less:
Fair value of Public Warrants at issuance		(7,894,290)
Offering costs allocated to common stock subject to possible redemption		(9,494,877)
Plus:
Accretion on common stock subject to possible redemption		17,389,167
Common stock subject to possible redemption	$	171,615,000


	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:

U.S. Treasury securities	$	171,636,419	$	—	$	—
Liabilities
Derivative Warrant liability- Private warrants	$	—	$	—	$	5,618,625


	At Issuance			September 30, 2021
Exercise price	$	11.50		$	11.50
Share price	$	9.93		$	9.69
Expected term (years)		6.59			6.23
Volatility		29.50	%		16.30	%
Risk-free rate		1.20	%		1.19	%
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 derivative warrant liability		(141,647)
Derivative warrant liability at June 30, 2021		11,095,603
Change in fair value of derivative warrant liability		(5,476,978)
Derivative warrant liability at September 30, 2021	$	5,618,625


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