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, 2022


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

For the transition period from to

Commission file number: 001-41281

SIGNAL HILL ACQUISITION CORP.

(Exact name of registrant as specified in its charter)


Delaware		86-2579543
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2810 N. Church Street, Suite 94644

Wilmington, DE 19802-8172


(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (646) 504-8172

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, which consist of one share of Class A common stock, par value $0.0001 per share, and one-half of one redeemable warrant to purchase one share of Class A common stock	SGHLU	The Nasdaq Global Market

Class A Common Stock, par value $0.0001 per share	SGHL	The Nasdaq Global Market

Warrants, each whole warrant exercisable for one share of Class A common stock, each at an exercise price of $11.50 per share	SGHLW	The Nasdaq Global Market

Securities registered pursuant to Section 12(g) of the Act: None.

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 9, 2022, there were 10,000,000 shares of Class A common stock, par value $0.0001 per share, and 2,500,000 shares of Class B common stock, par value $0.0001 per share, issued and outstanding.

Table of Contents

SIGNAL HILL ACQUISITION CORP.

FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2022

TABLE OF CONTENTS


		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Condensed Balance Sheets as of September 30, 2022 (Unaudited) and December 31, 2021	1
	Unaudited Condensed Statements of Operations for the Three and Nine Months Ended September 30, 2022, for the Three Months Ended September 30, 2021 and For the Period From February 18, 2021 (Inception) to September 30, 2021	2
	Unaudited Condensed Statements of Changes in Stockholders’ Equity for the Nine Months Ended September 30, 2022 and For the Period From February 18, 2021 (Inception) to September 30, 2021	3
	Unaudited Condensed Statements of Cash Flows for the Nine Months Ended September 30, 2022 and For the Period From February 18, 2021 (Inception) to 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	24
Item 4.	Controls and Procedures	24

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3.	Defaults Upon Senior Securities	25
Item 4.	Mine Safety Disclosures	25
Item 5.	Other Information	25
Item 6.	Exhibits	26
	Signatures	27

Table of Contents

CERTAIN TERMS

Unless otherwise stated in this Quarterly Report on Form 10-Q, or the context otherwise requires, references to:

●	“amended and restated certificate of incorporation” are to the Second Amended and Restated Certificate of the Company;

●	“B. Riley” are to B. Riley Securities, Inc., the representative of the underwriters in our initial public offering;

●	“common stock” are to our Class A common stock and our Class B common stock, collectively;

●	“founder shares” are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to our initial public offering, and the shares of our Class A common stock issuable upon the conversion thereof as provided herein;

●

 “initial public offering” or “IPO” means the initial public offering of 10,000,000 of our units, each unit consisting of one share of Class A common stock and one-half of one redeemable public warrant, where each whole public warrant entitles the holder to purchase one share of Class A common stock, which was consummated on February 15, 2022;

●	“initial stockholders” are to our sponsor and any other holders of our founder shares as of the closing of our initial public offering (or their permitted transferees);

●	“management” or our “management team” are to our officers and directors;

●	“private placement warrants” are to the warrants issued to our sponsor and certain of our initial stockholders in a private placement simultaneously with the closing of our initial public offering;

●	“public shares” are to shares of our Class A common stock sold as part of the units in our initial public offering (whether they are purchased in our initial public offering or thereafter in the open market);

●

 “public stockholders” are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder’s and member of our management team’s status as a “public stockholder” shall only exist with respect to such public shares;

●

 “public warrants” are to our redeemable warrants sold as part of the units in our initial public offering (whether they are purchased in our initial public offering or thereafter in the open market), to the private placement warrants if held by third parties other than our initial stockholders or the underwriters (or permitted transferees), and to any private placement warrants issued upon conversion of working capital loans that are sold to third parties that are not initial purchasers or executive officers or directors (or permitted transferees), in each case, following the consummation of our initial business combination;

●	“sponsor” are to Signal Hill Acquisition Sponsor, LLC, a Delaware limited liability company;

●	“warrants” are to our redeemable warrants, which includes the public warrants as well as the private placement warrants; and

●	“we,” “us,” “Company,” “the Company,” or “our Company” are to Signal Hill Acquisition Corp.

Table of Contents

SIGNAL HILL ACQUISITION CORP.

CONDENSED BALANCE SHEETS


		September 30,		December 31,
		2022		2021
		(Unaudited)
ASSETS
Current Assets:
Cash	$	590,291	$	1,170
Prepaid expenses		232,556		—
Total Current Assets		822,847		1,170
Prepaid expenses, non-current portion		78,932		—
Deferred offering costs		—		320,716
Cash and cash equivalents held in Trust Account		102,618,821		—
Total Assets	$	103,520,600	$	321,886

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	3,617	$	237,636
Accrued expenses		229,266		431
Accrued offering costs		—		25,000
Income taxes payable		147,247		—
Notes payable - related party		—		35,000
Accrued interest - related party		—		21
Total Current Liabilities		380,130		298,088
Total Liabilities		380,130		298,088

Commitments and Contingencies (Note 6)
Class A common stock subject to possible redemption; 10,000,000 and no shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively, at redemption value (at $10.23 per share)		102,321,143		—

Stockholders' Equity:
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; no shares issued and outstanding		—		—
Class A common stock, $0.0001 par value; 100,000,000 shares authorized; no shares issued and outstanding (excluding 10,000,000 shares subject to possible redemption)		—		—
Class B common stock, $0.0001 par value; 10,000,000 shares authorized; 2,500,000 and 2,875,000 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively (1)		250		288
Additional paid-in capital		1,000,038		24,712
Accumulated deficit		(180,961)		(1,202)
Total Stockholders' Equity		819,327		23,798
Total Liabilities, Temporary Equity and Stockholders’ Equity	$	103,520,600	$	321,886

(1) Balance at December 31, 2021 included 375,000 shares of Class B common stock that were subject to forfeiture if the option to purchase additional units was not exercised in full or in part by the underwriter. On April 2, 2022, the option expired unexercised, such that 375,000 shares of Class B common stock were forfeited by the Sponsor (see Note 5).

The accompanying notes are an integral part of these financial statements.

Table of Contents

SIGNAL HILL ACQUISITION CORP.

CONDENSED STATEMENTS OF OPERATIONS

(unaudited)


							For the Period
							From February 18,
	For the Three Months Ended				For the Nine		2021 (Inception)
	September 30,				Months Ended		Through
	2022		2021		September 30, 2022		September 30, 2021
Operating Expenses:
Formation and operating costs	$	156,605	$	—	$	467,462	$	370
Franchise tax expense		50,000		—		150,000		—
Total Operating Expenses		206,605		—		617,462		370
Loss From Operations		(206,605)		—		(617,462)		(370)

Other Income (Expenses):
Change in fair value of overallotment liability		—		—		603,284		—
Interest income		485,114		—		618,821		—
Interest expense		—		(8)		(39)		(8)
Offering costs		—		—		(16,511)		—
Bank fees		(75)		(70)		(554)		(95)
Total Other Income (Expense)		485,039		(78)		1,205,001		(103)

Income (loss) before provision for income taxes		278,434		(78)		587,539		(473)
Provision for income taxes		(147,247)		—		(147,247)		—
Net Income (Loss)	$	131,187	$	(78)	$	440,292	$	(473)

Basic and diluted weighted average shares outstanding, Class A common stock		10,000,000		—		8,321,168		—
Basic and diluted net income per common stock, Class A common stock	$	0.01	$	—	$	0.04	$	—
Basic and diluted weighted average shares outstanding, Class B common stock (1)		2,500,000		2,500,000		2,500,000		2,500,000
Basic and diluted net income (loss) per common stock, Class B common stock	$	0.01	$	(0.00)	$	0.04	$	(0.00)

(1) Excludes 375,000 shares of Class B common stock that were subject to forfeiture if the option to purchase additional units was not exercised in full or in part by the underwriter. On April 2, 2022, the option expired unexercised, such that 375,000 shares of Class B common stock were forfeited by the Sponsor (see Note 5).

On March 23, 2021, the Sponsor paid $25,000 in consideration for an aggregate of 3,750,000 founder shares. In December 2021, the Sponsor surrendered an aggregate of 875,000 founder shares for no consideration, thereby reducing the aggregate number of founder shares outstanding to 2,875,000. All shares and related amounts have been retroactively adjusted to reflect to the forfeiture.

The accompanying notes are an integral part of these financial statements.

Table of Contents

SIGNAL HILL ACQUISITION CORP.

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(unaudited)


	For the Nine Months Ended September 30, 2022
				Additional				Total
	Class B Common Stock			Paid-In		Accumulated		Stockholders'
	Shares	Amount		Capital		Deficit		Equity
Balance - January 1, 2022 (1)	2,875,000	$	288	$	24,712	$	(1,202)	$	23,798
Issuance of public warrants, net of offering costs allocated to public warrants of $136,842	—		—		4,863,158		—		4,863,158
Issuance of private placement warrants	—		—		6,000,000		—		6,000,000
Remeasurement of Class A common stock to redemption value	—		—		(9,887,870)		(298,908)		(10,186,778)
Net loss	—		—		—		(184,449)		(184,449)
Balance - March 31, 2022 (1)	2,875,000		288		1,000,000		(484,559)		515,729
Forfeiture of Class B common stock by Sponsor (2)	(375,000)		(38)		38		—		—
Accretion of Class A common stock to redemption value	—		—		—		(33,277)		(33,277)
Net income	—		—		—		493,554		493,554
Balance - June 30, 2022	2,500,000		250		1,000,038		(24,282)		976,006
Accretion of Class A common stock to redemption value	—		—		—		(287,866)		(287,866)
Net income	—		—		—		131,187		131,187
Balance - September 30, 2022	2,500,000	$	250	$	1,000,038	$	(180,961)	$	819,327


	For the Period From February 18, 2021 (Inception) Through September 30, 2021
				Additional				Total
	Class B Common Stock			Paid-In		Accumulated		Stockholders'
	Shares	Amount		Capital		Deficit		Equity
Balance - February 18, 2021 (Inception)	—	$	—	$	—	$	—	$	—
Issuance of Class B common stock to Sponsor (1)	2,875,000		288		24,712		—		25,000
Net loss	—		—		—		(370)		(370)
Balance - March 31, 2021	2,875,000		288		24,712		(370)		24,630
Net loss	—		—		—		(25)		(25)
Balance - June 30, 2021	2,875,000		288		24,712		(395)		24,605
Net loss	—		—		—		(78)		(78)
Balance - September 30, 2021	2,875,000	$	288	$	24,712	$	(473)	$	24,527

(1) Included 375,000 shares of Class B common stock that were subject to forfeiture if the option to purchase additional units was not exercised in full or in part by the underwriter. See note (2) below.

(2) On April 2, 2022, the option to purchase additional units expired unexercised, such that 375,000 shares of Class B common stock were forfeited by the Sponsor (see Note 5).

The accompanying notes are an integral part of these financial statements.

Table of Contents

SIGNAL HILL ACQUISITION CORP.

CONDENSED STATEMENTS OF CASH FLOWS

(unaudited)


			For the Period From
	For the Nine Months		February 18, 2021
	Ended		(Inception) Through
	September 30, 2022		September 30, 2021
Cash Flows from Operating Activities:
Net income (loss)	$	440,292	$	(473)
Non-cash offering costs		16,511		—
Interest earned on investments held in Trust Account		(618,821)		—
Change in fair value of overallotment liability		(603,284)		—
Changes in operating assets and liabilities:
Prepaid expenses		(311,488)		—
Accounts payable		3,247		370
Accrued expenses		228,835		—
Accrued interest - related party		(21)		8
Income taxes payable		147,247		—
Net Cash Used In Operating Activities		(697,482)		(95)

Cash Flows from Investing Activities:
Investment of cash in Trust Account		(102,000,000)		—
Net Cash Used In Investing Activities		(102,000,000)		—

Cash Flows from Financing Activities:
Proceeds from initial public offering		100,000,000		—
Proceeds from private placement warrants		6,000,000		—
Proceeds from issuance of Class B common stock to Sponsor		—		25,000
Proceeds from issuance of note payable - related party		335,000		25,000
Repayment of note payable - related party		(370,000)		—
Advance from related party		—		10,000
Repayment of advance to related party		—		(10,000)
Payment of offering costs		(2,678,397)		(43,450)
Net Cash Provided By Financing Activities		103,286,603		6,550

Net Increase in Cash		589,121		6,455

Cash - Beginning of the Period		1,170		—
Cash - End of the Period	$	590,291	$	6,455

Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for:
Interest	$	60	$	—
Income taxes	$	—	$	—

Non-cash investing and financing activities:
Reversal of deferred offering costs	$	(25,000)	$	24,208
(Reversal) accrual of deferred offering costs included in accounts payable	$	(237,266)	$	164,984
Remeasurement of Class A common stock	$	298,908		—
Accretion of Class A common stock to redemption value	$	321,143	$	—

The accompanying notes are an integral part of these financial statements.

Table of Contents

SIGNAL HILL ACQUISITION CORP.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

NOTE 1 — ORGANIZATION, PLAN OF BUSINESS OPERATIONS, GOING CONCERN AND MANAGEMENT’S PLANS, RISKS AND UNCERTAINTIES, AND BASIS OF PRESENTATION

Signal Hill Acquisition Corp. (the “Company”) was incorporated in Delaware on February 18, 2021. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (the “Business Combination”).

The Company is not limited to a particular industry or sector for purposes of consummating a Business Combination. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.

All activity for the period from February 18, 2021 (inception) through September 30, 2022 relates to the Company’s formation, the initial public offering (“IPO”), which is described below and, since the closing of the IPO, the search for a prospective initial Business Combination. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the IPO. The Company has selected December 31 as its fiscal year end.

The registration statement for the Company’s IPO was declared effective on February 10, 2022. On February 15, 2022, the Company consummated the IPO of 10,000,000 units (the “Units” and, with respect to the Class A common stock included in the Units sold, the “public shares” or the “Class A Common Stock”), generating gross proceeds of $100,000,000, which is described in Note 3.

Simultaneously with the closing of the IPO and in a second closing on February 28, 2022, the Company consummated the sale of an aggregate of 6,000,000 private placement warrants at a price of $1.00 per private placement warrant in a private placement to Signal Hill Acquisition Sponsor, LLC (the “sponsor”) and certain initial stockholders, generating gross proceeds to the Company of $6,000,000, which is described in Note 4.

Transaction costs related to the IPO amounted to $2,736,847, consisting of $2,000,000 of underwriting fees and $736,847 of other offering costs. In addition, cash of $1,012,777 was held outside of the Trust Account (as defined below) and is available for the payment of offering costs and for working capital purposes. As described in Note 6, $3,500,000 of business combination marketing fees become due and payable upon the consummation of the Business Combination. Transaction costs related to the private placement amounted to $7,483,893 as of February 15, 2022, which represented the estimated fair value of Class B common stock to be transferred to investors in the offering, which is described in Note 4.

Following the closing of the IPO on February 15, 2022, an amount of $102,000,000 ($10.20 per Unit) from the net proceeds of the sale of the Units in the IPO and the sale of the private placement warrants was placed in a U.S.-based trust account maintained by Continental Stock Transfer & Trust Company, acting as trustee (the “Trust Account”), to be invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less, or in any open-ended investment company that holds itself out as a money market fund meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the consummation of a Business Combination or (ii) the distribution of the funds in the Trust Account to the Company’s shareholders, as described below.

The Company’s management has broad discretion with respect to the specific application of the net proceeds of the IPO and the sale of private placement warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating one or more Business Combinations. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete one or more initial Business Combinations with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the Trust Account (as defined below) (excluding the taxes payable on the interest earned on the Trust Account). The Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act.

SEC Form 10-Q filed by Signal Hill Acquisition Corp.