RELATED PARTY TRANSACTIONS	9 Months Ended
Sep. 30, 2022
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares On February 3, 2021, the Sponsor paid $25,000 to cover certain offering costs of the Company in consideration for 5,031,250 shares of Class B common stock (the “Founder Shares”). The Founder Shares include an aggregate of up to 562,500 shares subject to forfeiture to the extent that the underwriter’s over-allotment is not exercised in full or in part, so that the Sponsor will own 20% of the Company’s issued and outstanding shares upon the completion of the Initial Public Offering. On June 8, 2021, the Sponsor surrendered 718,750 Founder Shares for no consideration. On June 16, 2021, the underwriters partially exercised the over-allotment option to purchase an additional 1,680,000 shares (see Note 6). On July 26, 2021, 142,500 Founder Shares were forfeited upon the expiration of the underwriters’ over-allotment option, resulting in an aggregate of 4,170,000 Founder Shares outstanding. The Sponsor has agreed that, subject to certain limited exceptions, the Founder Shares will not be transferred, assigned, sold or released from escrow until the earlier of (a) one year after the completion of a Business Combination or (b) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction after a Business Combination that results in all of the Company’s stockholders having the right to exchange their Class A common stock for cash, securities or other property. Notwithstanding the foregoing, if (i) the closing price of the Company’s Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Business Combination or (ii) if the Company consummates a transaction after the Business Combination which results in the Company’s stockholders having the right to exchange their shares for cash, securities or other property, the founder shares will be released from the lock-up. Reimbursable Expenses The Sponsor and an affiliate of the Sponsor paid $0 and $74,328 to cover certain operating costs on behalf of the Company during the three and nine months ended September 30, 2022. The Sponsor and an affiliate of the Sponsor paid $29,579 and $210,267 to cover certain operating and offerings costs on behalf of the Company during the three months ended September 30, 2021 and for the period from January 22, 2021 (inception) through September 30, 2021. As of September 30, 2022 and December 31, 2021, $317,333 and $163,715, respectively, was accrued in due to related parties in the condensed balance sheets. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds held in the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination is not completed, the Company may use a portion of the proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,000,000 of such Working Capital Loans may be convertible into shares of Class A common stock at a price of $10.00 per share. As of September 30, 2022 and December 31, 2021, the Company did not have any outstanding Working Capital Loans. Consulting Agreement The Company entered into an agreement with a related party on January 26, 2021, to pay the related party a total of $25,000 per month for research, financial analysis, due diligence, bookkeeping and other administrative services from formation through the Business Combination. For the three and nine months ended September 30, 2022, the Company incurred $75,000 and $225,000, respectively, in expenses under this agreement. For the three months ended September 30, 2021 and for the period from January 22, 2021 (inception) through September 30, 2021, the Company incurred $75,000 and $130,000, respectively, in expenses under this agreement. As of September 30, 2022 and December 31, 2021, $100,000 and $25,000, respectively, related to this agreement is recorded in due to related parties on the condensed balance sheets. Administrative Support Agreement The Company entered into an agreement, commencing on the effective date of the Initial Public Offering, to pay the Sponsor a total of $10,000 per month for office space, administrative and support services. Upon the completion of the Business Combination or the Company’s liquidation, the Company will cease paying these monthly fees. For the three and nine months ended September 30, 2022, the Company incurred $30,000 and $90,000, respectively, in expenses under this agreement. For the three months ended September 30, 2021 and for the period from January 22, 2021 (inception) through September 30, 2021, the Company did not incur any expenses under this agreement. As of September 30, 2022 and December 31, 2021, $157,333 and $67,333, respectively, related to this agreement is recorded in due to related parties on the condensed balance sheets. Convertible Note – Related Party On August 24, 2022, the Company issued two (2) unsecured promissory notes, in the aggregate principal amount of $395,000 (the “Notes”). The first note was issued in three separate payments (May 31, 2022 of $100,000, August 3, 2022 of $25,000, and August 18, 2022 of $20,000) totaling the amount of $145,000 by the Sponsor and the second note was issued on September 1, 2022 in the amount of $250,000 by Joshua L. Spear, the Company’s Chief Executive Officer. The Notes do not bear interest and mature upon closing of a Business Combination by the Company. In addition, the Notes may be converted by the holder into common stock of the Company at a price of $10.00 per share.

RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2022

NOTE 5. RELATED PARTY TRANSACTIONS

Founder Shares

On February 3, 2021, the Sponsor paid $25,000 to cover certain offering costs of the Company in consideration for 5,031,250 shares of Class B common stock (the “Founder Shares”). The Founder Shares include an aggregate of up to 562,500 shares subject to forfeiture to the extent that the underwriter’s over-allotment is not exercised in full or in part, so that the Sponsor will own 20% of the Company’s issued and outstanding shares upon the completion of the Initial Public Offering. On June 8, 2021, the Sponsor surrendered 718,750 Founder Shares for no consideration. On June 16, 2021, the underwriters partially exercised the over-allotment option to purchase an additional 1,680,000 shares (see Note 6). On July 26, 2021, 142,500 Founder Shares were forfeited upon the expiration of the underwriters’ over-allotment option, resulting in an aggregate of 4,170,000 Founder Shares outstanding.

The Sponsor has agreed that, subject to certain limited exceptions, the Founder Shares will not be transferred, assigned, sold or released from escrow until the earlier of (a) one year after the completion of a Business Combination or (b) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction after a Business Combination that results in all of the Company’s stockholders having the right to exchange their Class A common stock for cash, securities or other property. Notwithstanding the foregoing, if (i) the closing price of the Company’s Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Business Combination or (ii) if the Company consummates a transaction after the Business Combination which results in the Company’s stockholders having the right to exchange their shares for cash, securities or other property, the founder shares will be released from the lock-up.

Reimbursable Expenses

The Sponsor and an affiliate of the Sponsor paid $0 and $74,328 to cover certain operating costs on behalf of the Company during the three and nine months ended September 30, 2022. The Sponsor and an affiliate of the Sponsor paid $29,579 and $210,267 to cover certain operating and offerings costs on behalf of the Company during the three months ended September 30, 2021 and for the period from January 22, 2021 (inception) through September 30, 2021. As of September 30, 2022 and December 31, 2021, $317,333 and $163,715, respectively, was accrued in due to related parties in the condensed balance sheets.

Related Party Loans

In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds held in the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination is not completed, the Company may use a portion of the proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,000,000 of such Working Capital Loans may be convertible into shares of Class A common stock at a price of $10.00 per share. As of September 30, 2022 and December 31, 2021, the Company did not have any outstanding Working Capital Loans.

Consulting Agreement

The Company entered into an agreement with a related party on January 26, 2021, to pay the related party a total of $25,000 per month for research, financial analysis, due diligence, bookkeeping and other administrative services from formation through the Business Combination. For the three and nine months ended September 30, 2022, the Company incurred $75,000 and $225,000, respectively, in expenses under this agreement. For the three months ended September 30, 2021 and for the period from January 22, 2021 (inception) through September 30, 2021, the Company incurred $75,000 and $130,000, respectively, in expenses under this agreement. As of September 30, 2022 and December 31, 2021, $100,000 and $25,000, respectively, related to this agreement is recorded in due to related parties on the condensed balance sheets.

Administrative Support Agreement

The Company entered into an agreement, commencing on the effective date of the Initial Public Offering, to pay the Sponsor a total of $10,000 per month for office space, administrative and support services. Upon the completion of the Business Combination or the Company’s liquidation, the Company will cease paying these monthly fees. For the three and nine months ended September 30, 2022, the Company incurred $30,000 and $90,000, respectively, in expenses under this agreement. For the three months ended September 30, 2021 and for the period from January 22, 2021 (inception) through September 30, 2021, the Company did not incur any expenses under this agreement. As of September 30, 2022 and December 31, 2021, $157,333 and $67,333, respectively, related to this agreement is recorded in due to related parties on the condensed balance sheets.

Convertible Note – Related Party

On August 24, 2022, the Company issued two (2) unsecured promissory notes, in the aggregate principal amount of $395,000 (the “Notes”). The first note was issued in three separate payments (May 31, 2022 of $100,000, August 3, 2022 of $25,000, and August 18, 2022 of $20,000) totaling the amount of $145,000 by the Sponsor and the second note was issued on September 1, 2022 in the amount of $250,000 by Joshua L. Spear, the Company’s Chief Executive Officer. The Notes do not bear interest and mature upon closing of a Business Combination by the Company. In addition, the Notes may be converted by the holder into common stock of the Company at a price of $10.00 per share.