TruGolf Holdings, Inc 10-K, filed Jun 24, 2022

TruGolf Holdings, Inc. (TRUG)

10-K 2022-06-24 For: 2022-03-31

Added on April 08, 2026

About this 10-K

TruGolf Holdings, Inc filed this 10-K on June 24, 2022, covering the fiscal year ended March 31, 2022.

Headline figures

Fiscal year ended March 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Net loss: $414.05K

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595 Madison Avenue, 12th Floor, New York, NY		10017
(Address of principal executive offices)		(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $0.0001 per share	DMAQ	The Nasdaq Stock Market LLC
Rights, each exchangeable into one-tenth of one share of Class A Common Stock	DMAQR	The Nasdaq Stock Market LLC

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

		Page Numbers
PART I		1

Item 1.	Business	1

Item 1A.	Risk Factors	19

Item 1B.	Unresolved Staff Comments	50

Item 2.	Properties	50

Item 3.	Legal Proceedings	51

Item 4.	Mine Safety Disclosures	51

PART II		51

Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	51

Item 6.	Reserved	52

Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	52

Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	59

Item 8.	Financial Statements and Supplementary Data	59

Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosures	59

Item 9A.	Controls and Procedures	60

Item 9B.	Other Information	61

Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.	61

PART III		61

Item 10.	Directors, Executive Officers and Corporate Governance	61

Item 11.	Executive Compensation	70

Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	71

Item 13.	Certain Relationships and Related Transactions, and Director Independence	73

Item 14.	Principal Accounting Fees and Services	76

PART IV		77

Item 15.	Exhibits and Financial Statement Schedules	77

Item 16.	Form 10-K Summary	79

	Signatures	80

	•		Strong network: the diverse background of our team and their many years in the different areas in healthcare, including experience as clinicians at the highest level of clinical medicine at institutions such as the Mayo Clinic and with the top life science companies as McKinsey consultants, and investors in high-impact companies, means that sourcing companies and finding great talent for them, and helping them with connecting to the right clinical institutions will be a major source of competitive advantage.

	•		Deal experience: members of our team has been involved in some of the largest equity and M&A deals in healthcare and digital health over the last two decades, including the Pfizer acquisition of Wyeth pharmaceuticals, equity financing of digital health companies such as Castlight health and Acupera, and exists of companies such as Flatiron health.

	•		Operational value-add: given the experience of the team in commercializing digital solutions in healthcare, there will be significant lessons learned that can be used in ensuring product-market fit and faster adoption. This will also include a network of medical centers that can be used to generate evidence for the solutions that will eventually be the major driver for the adoption of such solutions.

	•		Sector focus: although AI in Medicine will touch almost every aspect of healthcare, the short- and medium-term applications that will yield significant growth and ROI will be in certain sectors that have certain characteristics. These include the presence of large amounts of structured data, current diagnostic or therapeutic challenges, current solutions with significant limitations, and available infrastructure and workflows to launch the solutions.

	•		Nature of products and solutions: experience to date in AI in Medicine shows that successfully developed algorithms with FDA approval have struggled to gain traction in clinical medicine due to a number of factors. These include the urgency of the issues they are tackling, complexity of their incorporation into the clinical workflows, reimbursement issues by payers, impact on medical center revenues and profits, and more. This vast experience with what it takes to reach clinical adoption and commercial success will guide our selection of potential targets.

	•		Opportunities for accelerating growth: innovative companies with algorithms in radiology, dermatology, pathology, drug discovery and so forth are encountering various barriers for the adoption of their solutions. Examination of the leadership of these companies shows great technical and product expertise but limited clinical experience or lack of familiarity with the process of generating evidence that leads to clinical adoption and insurance reimbursement. Given the depth and diversity of the experience in our team, we will look for innovative companies that have products that can gain clinical adoption and reimbursement if the right evidence is generated with a network of clinical partners.

	•		Strong management teams: given the complexity of healthcare and the blend of expertise that will be needed to develop strong products and incorporate them into the clinical workflows, we will look for teams that have a strong track record of developing products, strong data science expertise, digital application experience, with clinical experience preferred by not absolutely necessary as our team will be able to round out their data and digital experience with expertise in clinical and digital health, as well as commercial and corporate finance experience.

	•		subject us to negative economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact on the particular industry in which we operate after our initial business combination, and

	•		cause us to depend on the marketing and sale of a single product or limited number of products or services.

Type of Transaction		Whether Stockholder Approval is Required
Purchase of assets		No
Purchase of stock of target not involving a merger with the company		No
Merger of target into a subsidiary of the company		No
Merger of the company with a target		Yes

	•		any of our directors, officers or substantial stockholders (as defined by Nasdaq rules) has a 5% or greater interest (or such persons collectively have a 10% or greater interest), directly or indirectly, in the target business or assets to be acquired or otherwise and the present or potential issuance of common stock could result in an increase in outstanding common shares or voting power of 5% or more; or

	•		the issuance or potential issuance of common stock will result in our undergoing a change of control.

	•		conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and

	•		file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies.

	•		conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and

	•		file proxy materials with the SEC.

	•		a limited availability of market quotations for our securities;

	•		reduced liquidity for our securities;

	•		a determination that our Class A common stock is a “penny stock” which will require brokers trading in our Class A common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;

	•		a limited amount of news and analyst coverage; and

	•		a decreased ability to issue additional securities or obtain additional financing in the future.

	•		restrictions on the nature of our investments; and

	•		restrictions on the issuance of securities, each of which may make it difficult for us to complete our initial business combination.

	•		registration as an investment company;

	•		adoption of a specific form of corporate structure; and

	•		reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations.

	•		may significantly dilute the equity interest of investors in the IPO;

	•		may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded our common stock;

	•		could cause a change of control if a substantial number of shares of our common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; and

	•		may adversely affect prevailing market prices for our units, Class A common stock and/or rights.

	•		default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations;

	•		acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;

	•		our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;

	•		our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding;

	•		our inability to pay dividends on our common stock;

	•		using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our common stock if declared, our ability to pay expenses, make capital expenditures and acquisitions, and fund other general corporate purposes;

	•		limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;

	•		increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;

	•		limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution of our strategy; and

	•		other disadvantages compared to our competitors who have less debt.

	•		solely dependent upon the performance of a single business, property or asset, or

	•		dependent upon the development or market acceptance of a single or limited number of products, processes or services.

	•		prior offerings of those companies;

	•		our prospects for acquiring an operating business;

	•		a review of debt to equity ratios in leveraged transactions;

	•		our capital structure;

	•		an assessment of our management and their experience in identifying operating companies;

	•		general conditions of the securities markets at the time of the IPO; and

	•		other factors as were deemed relevant.

Public shares		12,650,000
Founder shares		3,162,500
Representative’s shares		101,200
Private placement shares		519,500
Total shares		16,433,200
Total funds in trust available for initial business combination (less business combination marketing fees)	$	123,337,500
Initial implied value per public share	$	10.10
Implied value per share upon consummation of initial business combination	$	7.51

	•		costs and difficulties inherent in managing cross-border business operations and complying with commercial and legal requirements of overseas markets;

	•		rules and regulations regarding currency redemption;

	•		complex corporate withholding taxes on individuals;

	•		laws governing the manner in which future business combinations may be effected;

	•		tariffs and trade barriers;

	•		regulations related to customs and import/export matters;

	•		longer payment cycles;

	•		tax consequences;

	•		currency fluctuations and exchange controls;

	•		rates of inflation;

	•		challenges in collecting accounts receivable;

	•		cultural and language differences;

	•		employment regulations;

	•		crime, strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars;

	•		deterioration of political relations with the United States;

	•		obligatory military service by personnel; and

	•		government appropriation of assets.

	•		may significantly dilute the equity interest of investors in the IPO, which dilution would increase if the anti-dilution provisions in the Class B common stock resulted in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the Class B common stock;

	•		may subordinate the rights of holders of our common stock if preferred stock is issued with rights senior to those afforded our common stock;

	•		could cause a change in control if a substantial number of shares of our common stock is issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors;

	•		may have the effect of delaying or preventing a change of control of us by diluting the stock ownership or voting rights of a person seeking to obtain control of us; and

	•		may adversely affect prevailing market prices for our Class A common stock and/or rights.

	•		limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution of our strategy; and

	•		other purposes and other disadvantages compared to our competitors who have less debt.

Name	Age	Position/Title
Humphrey P. Polanen	73	Chief Executive Officer and Chairman of the Board
Weixuan Luo	49	Chief Financial Officer
Ronald M. Razmi, MD	52	Director
Tina Spires	45	Director
HongLiang Ren	42	Director
Bryant E. Fong	49	Director
Marc A. Hamer	49	Director
Wanlei Miao	38	Director

	•		been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
	•		had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time;
	•		been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, by any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity;
	•		been found by a court of competent jurisdiction in a civil action or by the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;
	•		been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
	•		been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

	•		the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm engaged by us;

	•		pre-approving all audit and permitted non-audit services to be provided by the independent registered public accounting firm engaged by us, and establishing pre-approval policies and procedures;

	•		setting clear hiring policies for employees or former employees of the independent registered public accounting firm, including but not limited to, as required by applicable laws and regulations;

	•		setting clear policies for audit partner rotation in compliance with applicable laws and regulations;

	•		obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (i) the independent registered public accounting firm’s internal quality-control procedures, (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues and (iii) all relationships between the independent registered public accounting firm and us to assess the independent registered public accounting firm’s independence;
	•		reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and
	•		reviewing with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities.

	•		reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officers’ compensation, if any is paid by us, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation;

	•		reviewing and approving on an annual basis the compensation, if any is paid by us, of all of our other officers;

	•		reviewing on an annual basis our executive compensation policies and plans;

	•		implementing and administering our incentive compensation equity-based remuneration plans;

	•		assisting management in complying with our proxy statement and annual report disclosure requirements;

	•		approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees;

	•		if required, producing a report on executive compensation to be included in our annual proxy statement; and

	•		reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.

	•		None of our officers or directors is required to commit his or her full time to our affairs and, accordingly, may have conflicts of interest in allocating his or her time among various business activities.

	•		In the course of their other business activities, our officers and directors may become aware of investment and business opportunities which may be appropriate for presentation to us as well as the other entities with which they are affiliated. Our management may have conflicts of interest in determining to which entity a particular business opportunity should be presented.

	•		Our initial stockholders have agreed to waive their redemption rights with respect to any founder shares, any private placement shares and any public shares held by them in connection with the consummation of our initial business combination. Additionally, our initial stockholders have agreed to waive their redemption rights with respect to any founder shares or private placement shares held by them if we fail to consummate our initial business combination within 12 months (or 18 if extended). If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement units held in the trust account will be used to fund the redemption of our public shares, and the private placement rights (and the underlying securities) will expire worthless. Subject to certain limited exceptions, our initial stockholders have agreed not to transfer, assign or sell 50% of their founder shares until the earlier of (i) six months after the date of the consummation of our initial business combination or (ii) the date on which the closing price of our shares of common stock equals or exceeds $12.50 per share (as adjusted for stock sub-divisions, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after our initial business combination and the remaining 50% of the founder shares may not be transferred, assigned or sold until six months after the date of the consummation of our initial business combination, or earlier, in either case, if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property. With certain limited exceptions, the private units will not be transferable, assignable or saleable until 30 days after the completion of our initial business combination. Since our sponsor will own common stock and rights following the IPO and our officers and directors will be issued shares of common stock following our initial business combination, our officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination.

	•		We will issue to our officers and directors an aggregate of 300,000 post business combination shares within 10 days following the business combination, with the same lock-up restrictions and registration rights as the founder shares. As such, our officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination.

	•		Our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination.

	•		the corporation could financially undertake the opportunity;

	•		the opportunity is within the corporation’s line of business; and

	•		it would not be fair to our company and its stockholders for the opportunity not to be brought to the attention of the corporation.

Individual⁽¹⁾⁽²⁾	Entity	Entity’s Business	Affiliation
Humphrey P. Polanen	NeoVista Ventures LLC	Healthcare Holding Company	Chief Executive Officer and Managing Member
	TechFlow Inc.	Information Technology	Director

Weixuan Luo	L&L CPAs PA	Auditing	President
	Conceptual Consulting Inc.	Accounting	President
	American Aeolian Travel Inc.	Travel Agency	President
	Greentree Financial Group Inc.	Consulting and Financial Advisory Services	Partner

Ronald M. Razmi, MD	Kinders	Medical Artificial Intelligence Advisory and Development Company	Founder/CEO
	Acupera	Population Health Management Software Company	Founder/former CEO

Tina Spires	Hope Women’s Center	Medical Clinic	Director
	The Cleveland Clinic	Hospital	Physician
	Florida Tems	Education Centre	Medical Director
	Spires Cattle	Livestock	President
	Tina Spires Inc.	Insurance Adjusting	President


HongLiang Ren	Dong Fang Hui Jia Asset Management Co., Ltd.	Private Equity Investment	CEO
	FeiDi Technology (Shenzhen) Co., Ltd.	Ride-sharing Technology Company	Chairman of the Board


Bryant E. Fong	Biomark Capital Fund	Healthcare Venture Capital	Managing Director and General Partner
	i2Dx	Software Company	Co-Founder, Interim Chief Executive Officer, Director
	ADMA Biologics, Inc. (Nasdaq: ADMA)	Biopharmaceuticals	Director
	Eden Biologics, Inc.	Biotechnology	Director

Marc A. Hamer	Orgill	Retail, Distribution & Services	Executive Vice President, CTO and CIO

Wanlei Miao	SAIF AMC	Asset Management	Partner

(1)	Each of the entities listed in this table has priority and preference relative to our company with respect to the performance by each individual listed in this table of his obligations and the presentation by each such individual of business opportunities.
(2)	Each individual listed has a fiduciary duty with respect to each of the listed entities opposite from his name.

	Class A Common Stock					Class B Common Stock
Name, Position and Address of Beneficial Owner	No. of Shares Beneficially Owned		% of Common Stock			No. of Shares Beneficially Owned	% of Common Stock
Humphrey P. Polanen, Chief Executive Officer and Chairman of the Board⁽¹⁾		-		0	%	25,000	0.8%
Weixuan Luo, Chief Financial Officer		-		0	%	-	0%
Ronald M. Razmi, MD, Director⁽²⁾		-		0	%	50,000	1.6%
Tina Spires, Director		-		0	%	-	0%
HongLiang Ren, Director		-		0	%	-	0%
Bryant E. Fong, Director		-		0		-	0%
Marc A. Hamer, Director		-		0	%	-	0%
Wanlei Miao, Director		-		0	%	-	0%

All directors and executive officers as a group		-		0	%	75,000	2.4%
Five Percent Shareholders:
Bright Vision Sponsor LLC⁽³⁾		257,869		1.9	%	2,764,089	87.4%
Lighthouse Investment Partners, LLC⁽⁴⁾		894,934		6.7	%	-	0%
Saba Capital Management, L.P.⁽⁵⁾		907,141		6.8	%	-	0%
Mizuho Financial Group, Inc.⁽⁶⁾		806,210		6.1	%	-	0%
Yakira Capital Management, Inc.⁽⁷⁾		694,445		5.2	%	-	0%
Weiss Asset Management LP⁽⁸⁾		750,000		5.7	%	-	0%
Karpus Management, Inc.⁽⁹⁾		2,016,347		15.2	%	-	0%
XL Golden Stone Investment LLC⁽¹⁰⁾		20,720		0.2	%	212,750	6.7%

(1)	Pursuant to certain redemption agreement between Bright Vision Sponsor LLC (the "Sponsor") and Polanen and Nicodimos Family Trust (the "Trust"), a member of the Sponsor, shares of Class B common stock of the registrants were transferred by the Sponsor to the Trust in consideration for the redemption of such membership interest of the Sponsor entitling the Trust to receive such securities. Humphrey P. Polanen is the trustee. By virtue of the relationship, Mr. Polanen may be deemed to have or share beneficial ownership of the securities held of record by the Trust. Mr. Polanen disclaims any beneficial ownership of the reported shares other than to the extent of any pecuniary interest he may have therein, directly or indirectly.

(2)	Pursuant to certain redemption agreement between Bright Vision Sponsor LLC (the "Sponsor") and Ronald M. Razmi, a member of the Sponsor, shares of Class B common stock of the registrants were transferred by the Sponsor to Mr. Razmi in consideration for the redemption of such membership interest of the Sponsor entitling Mr. Razmi to receive such securities.

(3)	According to the Schedule 13D/A filed with the SEC on April 27, 2022 by Bright Vision Sponsor LLC (“Bright Vision”) and Ke Li. Mr. Li serves as the managing member of Bright Vision. Mr. Li disclaims beneficial ownership of these securities. The principal business address of each of Bright Vision and Mr. Li is 595 Madison Avenue, 12th Floor, New York, NY 10017.