Related Party Transactions

3 Months Ended

Mar. 31, 2023

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 5—RELATED PARTY TRANSACTIONS

Founder Shares

On March 20, 2020, the Sponsor purchased 3,593,750 shares of Class B convertible common stock (the “Founder Shares”) for an aggregate price of $25,000, or approximately $0.007 per share. As used herein, unless the context otherwise requires, “Founder Shares” shall be deemed to include the shares of Class A common stock issuable upon conversion thereof. On August 3, 2020, the Company effected a 1.4-for-1 forward stock split of its issued and outstanding shares of Class B convertible common stock, resulting in an aggregate of 5,031,250 Founder Shares being outstanding, of which an aggregate of up to 656,250 shares were subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment option was not exercised in full or in part so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering (assuming the Sponsor did not purchase any Public Shares in the Initial Public Offering).

The over-allotment option was not exercised, consequently 656,250 Founder Shares were forfeited on November 5, 2020. As of March 31, 2023 and December 31, 2022, the issued and outstanding shares of Class B convertible common stock is 1,175,000 shares.

On September 27, 2022, the Company’s Sponsor contributed to the Company for purposes of making a deposit into the Company’s IPO Trust Account an aggregate of 200,000 shares of Class B common stock (to be converted into Class C common stock) to extend the date by which the Company had to consummate a business combination for one year, from September 21, 2022 to September 21, 2023. Following the contribution, the Sponsor owned 4,175,000 shares of Class B common stock.

On October 17, 2022, the Sponsor elected to convert 3,000,000 shares of Class B common stock into 3,000,000 shares of Class A common stock. Following the conversion, the Sponsor owned 1,175,000 shares of Class B common stock.

The Founder Shares are identical to the Class A common stock included in the Units sold in the Initial Public Offering, except that the Founder Shares have the exclusive right to elect, replace and remove the directors of the Company. Holders of Founder Shares may also elect to convert their shares of Class B convertible common stock into an equal number of shares of Class A common stock, subject to adjustment as provided above, at any time.

Promissory Note—Related Party

On September 16, 2020, the Sponsor agreed to loan the Company up to an aggregate of $150,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Note”). This loan was non-interest bearing and payable on the earlier of (i) September 16, 2021, (ii) the completion of the Initial Public Offering, or (iii) the date on which the Company determines not to proceed with the Initial Public Offering. On October 13, 2020, the balance of $150,000 was repaid in full. As of March 31, 2023, and December 31, 2022, there was no outstanding balance under this promissory note.

Administrative Support Agreement

The Company entered into an agreement whereby, commencing September 24, 2020, the Company will pay an affiliate of the Sponsor a total of $10,000 per month for office space, utilities and secretarial and administrative support. For the three months ended March 31, 2023 and 2022, the Company incurred fees for these services of $30,000 and $30,000 respectively. Administrative support fees included in accrued expenses in the accompanying unaudited condensed balance sheets at March 31, 2023, and December 31, 2022, were $302,000 and $272,000, respectively.

Related Party Loans

In order to finance transaction costs in connection with a transaction, the Sponsor, the Company’s officers or directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. The notes would either be repaid upon consummation of a transaction, without interest, or, at the lender’s discretion, up to $1,500,000 of the notes may be converted upon consummation of a transaction into warrants at a price of $1.00 per warrant. Such warrants would be identical to the Private Warrants. In the event that a transaction does not close, the Company may use cash on hand to repay the Working Capital Loans. As of March 31, 2023 and December 31, 2022, there were no Working Capital Loans outstanding.

Cash and Cash Equivalents

At March 31, 2023, the Company invested $1,155,480 in the Gabelli U.S. Treasury Money Market Fund, which is recorded in cash and cash equivalents on the condensed balance sheets.