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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
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(State or other jurisdiction of incorporation or organization)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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Title of Each Class:
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Trading Symbol:
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Name of Each Exchange on Which Registered:
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Large accelerated filer ☐
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Accelerated filer ☐
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Smaller reporting company
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Emerging growth company
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Page
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2
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4
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ITEM 1.
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4
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ITEM 1A.
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39
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ITEM 1B.
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73
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ITEM 2.
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73 | ||
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ITEM 3.
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73 | ||
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ITEM 4.
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73 | ||
| 73 | |||
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ITEM 5.
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73 | ||
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ITEM 6.
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75 |
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ITEM 7.
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75 |
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ITEM 7A.
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83 |
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ITEM 8.
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83 |
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ITEM 9.
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83 |
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ITEM 9A.
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84 |
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ITEM 9B.
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84 | ||
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ITEM 9C.
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84 | ||
| 85 | |||
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ITEM 10.
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85 | ||
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ITEM 11.
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95
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ITEM 12.
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96
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ITEM 13.
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97
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ITEM 14.
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100 |
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ITEM 15.
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100
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ITEM 16.
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102
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| • |
our ability to complete our proposed business with DevvStream;
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our expectations around the performance of DevvStream or any other prospective target business or businesses;
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our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination;
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our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination, as a result of which they would then receive expense
reimbursements;
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our potential ability to obtain additional financing to complete our initial business combination;
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our pool of prospective target businesses;
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our public securities’ potential liquidity and trading;
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the lack of a market for our securities;
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the trust account not being subject to claims of third parties; or
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our financial performance following our initial public offering.
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| ITEM 1. |
BUSINESS
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| 1. |
prior to the effective time of the Amalgamation (as defined below) (the “Effective Time”), FIAC will continue (the “FIAC Continuance”) from the State of Delaware under the Delaware General
Corporation Law (“DGCL”) to the Province of Alberta under the Business Corporations Act (Alberta) (“ABCA”) and change its name to DevvStream Corp. (“New PubCo”).
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| 2. |
following the FIAC Continuance, and in accordance with the applicable provisions of the Plan of Arrangement and the Business Corporations Act (British Columbia) (the “BCBCA”), Amalco Sub and DevvStream
will amalgamate to form one corporate entity (“Amalco”) in accordance with the terms of the BCBCA (the “Amalgamation”), and as a result of the Amalgamation, (i) each multiple voting share of DevvStream, without par value
(the “Multiple Voting Company Shares”) and each subordinate voting share of DevvStream, without par value (the “Subordinated Voting Company Shares” and together with the Multiple Voting Company Shares, the “Company Shares”)
issued and outstanding immediately prior to the Effective Time will be automatically exchanged for that certain number of common shares of New PubCo (“New PubCo Common Shares”) equal to the applicable Per Common Share Amalgamation
Consideration (as defined below), (ii) each option to purchase Company Shares (each a “Company Option”) and each restricted stock unit representing the right to receive payment in Company Shares (a “Company RSU”) issued and
outstanding immediately prior to the Effective Time will be cancelled and converted into an option to purchase a number of New PubCo Common Shares (“Converted Options”) and New PubCo restricted stock units, representing the right
to receive a number of New PubCo Common Shares (“Converted RSUs”), respectively, in an amount equal to the Company Shares underlying such Company Option or Company RSU, respectively, multiplied by the Common Conversion Ratio (as
defined below, and, for Company Options, at an adjusted exercise price equal to the exercise price for such Company Option prior to the Effective Time divided by the Common Conversion Ratio), (iii) each warrant exercisable for Company
Shares (a “Company Warrant”) issued and outstanding immediately prior to the Effective Time shall become exercisable for New PubCo Common Shares in an amount equal to the Company Shares underlying such Company Warrant multiplied by
the Common Conversion Ratio (and at an adjusted exercise price equal to the exercise price for such Company Warrant prior to the Effective Time divided by the Common Conversion Ratio), (iv) each holder of convertible notes to be issued by
DevvStream (the “Company Convertible Notes”), if any, issued and outstanding immediately prior to the Effective Time will first receive Company Shares and then New PubCo Common Shares in accordance with the terms of such Company
Convertible Notes and (v) each common share of Amalco Sub issued and outstanding immediately prior to the Effective Time will be automatically exchanged for one common share of Amalco (the FIAC Continuance and the Amalgamation, together
with the other transactions related thereto, the “Proposed Transactions”).
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| 3. |
Simultaneously with the execution of the Business Combination Agreement, FIAC and the sponsor entered into a Sponsor Side Letter (as defined below), pursuant to which, among other things, the sponsor
agreed to forfeit (i) 10% of its founder shares effective as of the consummation of the FIAC Continuance at the closing of the Proposed Transactions and (ii) with the sponsor’s consent, up to 30% of its founder shares and/or private
placement warrants in connection with financing or non-redemption arrangements, if any, entered into prior to consummation of the Business Combination. Pursuant to the Sponsor Side Letter, the sponsor also agreed to (1) certain transfer
restrictions with respect to our securities, lock-up restrictions (terminating upon the earlier of: (A) 360 days after the closing date of the Business Combination (the “Closing Date”), (B) a liquidation, merger, capital stock
exchange, reorganization or other similar transaction that results in all of New PubCo’s stockholders having the right to exchange their equity for cash, securities or other property or (C) subsequent to the Closing Date, the closing
price of the New Pubco Common Shares equaling or exceeding $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period
commencing at least 150 days after the closing of the Business Combination (the “Closing”)) and (2) to vote any FIAC shares held by it in favor of the Business Combination Agreement, the arrangement resolution and the Proposed
Transactions, and provided customary representations and warranties and covenants related to the foregoing.
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| 4. |
In addition, contemporaneously with the execution of the Business Combination Agreement, DevvStream, FIAC and each of Devvio, Inc., the majority and controlling shareholder of DevvStream, and DevvStream’s
directors and officers (the “Core Company Securityholders”) entered into Company Support & Lock-Up Agreements (the “Company Support Agreements”), pursuant to which, among other things, (i) each of the Core Company
Securityholders agreed to vote any Company Shares held by him, her or it in favor of the Business Combination Agreement, the arrangement resolution and the Proposed Transactions, and provided customary representations and warranties and
covenants related to the foregoing, and (ii) each of the Core Company Securityholders has agreed to certain transfer restrictions with respect to DevvStream securities prior to the Effective Time and lock-up restrictions with respect to
the New PubCo Common Shares to be received by such Core Company Securityholder under the Business Combination Agreement, which lock-up restrictions are consistent with those agreed to by the sponsor in the Sponsor Side Letter.
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The (i) Company Specified Representations (as defined in the Business Combination Agreement) are true and correct (without giving any effect to any limitation as to “materiality” or “Material Adverse
Effect” or any similar limitation set forth therein) in all material respects as of the date of the Business Combination Agreement and on and as of the Closing Date immediately prior to the Effective Time as if made on the Closing Date
immediately prior to the Effective Time (except to the extent such representations and warranties expressly relate to an earlier date, and in such case, shall be true and correct in all material respects on and as of such earlier date),
(ii) representations and warranties set forth in Article V (other than Section 5.5), are true and correct (without giving any effect to any limitation as to “materiality” or “Material Adverse Effect” or any similar limitation set forth
therein) as of the date of the Business Combination Agreement and on and as of the Closing Date immediately prior to the Effective Time as if made on the Closing Date immediately prior to the Effective Time (except to the extent such
representations and warranties expressly relate to an earlier date, and in such case, shall be true and correct on and as of such earlier date), except, in each case, the failure of such representations and warranties to be so true and
correct, has not had a Company Material Adverse Effect (as defined in the Business Combination Agreement) and (iii) the representations and warranties of DevvStream contained in Section 5.5 shall be true and correct, except for any de
minimis failures to be so true and correct, as of the date of the Business Combination Agreement and on and as of the Closing Date as if made on the Closing Date (except to the extent such representations and warranties expressly relate
to an earlier date, and in such case, shall be true and correct, except for any de minimis failures to be so true and correct, on and as of such earlier date) (collectively, the “DevvStream Representation Condition”).
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DevvStream shall have performed or complied in all material respects with all agreements and covenants required by the Business Combination Agreement to be performed or complied with by it on or prior to
the Closing Date (the “DevvStream Covenant Condition”).
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There has been no event that is continuing that would, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect (the “DevvStream MAE Condition”).
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Each of the Key Employees (as defined in the Business Combination Agreement) shall be actively employed or engaged with DevvStream as of the Closing Date.
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DevvStream shall have delivered to FIAC a certificate, dated the Closing Date, signed by an executive officer of DevvStream, certifying as to the satisfaction of the DevvStream Representation Condition, the
DevvStream Covenant Condition and the DevvStream MAE Condition (as it relates to DevvStream).
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DevvStream shall have delivered a certificate, signed by the secretary of DevvStream, certifying that true, complete and correct copies of its organizational documents, as in effect on the Closing Date, and
the resolutions of DevvStream’s board of directors authorizing and approving the Proposed Transactions are attached to such certificate.
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DevvStream shall have delivered counterparts of the Registration Rights Agreement (as defined below) executed by each holder of shares, options or warrants of Devvstream.
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The Core Company Securityholders shall be party to a Company Support Agreement.
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DevvStream shall have delivered executed counterparts of all Key Employment Agreements (as defined in the Business Combination Agreement).
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DevvStream shall have delivered a properly executed certification, dated as of the Closing Date, that meets the requirements of U.S. Treasury Regulations Sections 1.897-2(h) and 1.1445-2(c)(3), certifying
that DevvStream is not and has not been a “United States real property holding corporation” (as defined in Section 897(c)(2) of the Code).
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The (i) SPAC Specified Representations (as defined in the Business Combination Agreement) are true and correct (without giving any effect to any limitation as to “materiality” or “Material Adverse Effect”
or any similar limitation set forth therein) in all material respects as of the date of the Business Combination Agreement and on and as of the Closing Date as if made on the Closing Date (except to the extent such representations and
warranties expressly relate to an earlier date, and in such case, shall be true and correct in all material respects on and as of such earlier date), (ii) representations and warranties set forth in Articles III and IV (other than the
SPAC Specified Representations and those contained in Section 3.5 and Section 4.5 of the Business Combination Agreement), without giving effect to materiality, Material Adverse Effect or similar qualifications, are true and correct in
all respects at and as of the Closing Date as though such representations and warranties were made at and as of the Closing Date (other than in the case of any representation or warranty that by its terms addresses matters only as of
another specified date, which will be so true and correct only as of such specified date), except to the extent the failure of such representations and warranties to be true and correct would not reasonably be expected to have,
individually or in the aggregate, a SPAC Material Adverse Effect (as defined in the Business Combination Agreement) and (iii) the representations and warranties of FIAC and Amalco Sub, respectively, contained in Section 3.5 and Section
4.5 shall be true and correct, except for any de minimis failures to be so true and correct, as of the date of the Business Combination Agreement and on and as of the Closing Date as if made on the Closing Date (except to the extent
such representations and warranties expressly relate to an earlier date, and in such case, shall be true and correct, except for any de minimis failures to be so true and correct, on and as of such earlier date) (the “FIAC
Representation Condition”).
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Each of FIAC and Amalco Sub, respectively, shall have performed or complied in all material respects with all agreements and covenants required by the Business Combination Agreement to be performed or
complied with by it on or prior to the Closing Date (the “FIAC Covenant Condition”).
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FIAC shall have delivered to DevvStream a certificate, dated the Closing Date, signed by an authorized officer of FIAC, certifying as to the satisfaction of the FIAC Representation Condition and the FIAC
Covenant Condition.
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FIAC shall have delivered to DevvStream, dated the Closing Date, signed by the Secretary of FIAC certifying certifying that true, complete and correct copies of its organizational documents (after giving
effect to the FIAC Continuance), as in effect on the Closing Date, and as to the resolutions of FIAC’s board of directors unanimously authorizing and approving the Proposed Transactions and respective stockholders or members, as
applicable, authorizing and approving the Proposed Transactions.
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DevvStream shall have received counterparts of the Registration Rights Agreement executed by New PubCo.
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FIAC and New PubCo shall have delivered to DevvStream resignations of certain directors and executive officers of FIAC and Amalco Sub.
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| (i) |
By FIAC or DevvStream, if (i) the Required Company Shareholder Approval (as defined in the Business Combination Agreement) is not obtained at Company Meeting (as defined in the Business Combination Agreement), (ii) if the required
approvals are not obtained at the SPAC Special Meeting (as defined in the Business Combination Agreement), (iii) a law or orders prohibits or enjoins the consummation of the arrangement and has become final and nonappealable, or (iv) the
Effective Time does not occur on or before June 12, 2024 subject to a one-time thirty (30)-day extension upon written agreement of the parties (provided, that, if the registration statement shall not have been declared effective by the
SEC as of the Outside Date, the FIAC shall be entitled to one sixty (60)-day extension upon notice to DevvStream) (the “Outside Date”) (provided, however, that the right to terminate the Business Combination Agreement under the
clause described in this clause will not be available to a party if the inability to satisfy such conditions was due to the failure of such party to perform any of its obligations under the Business Combination Agreement).
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By FIAC or DevvStream if DevvStream’s board of directors or any committee thereof has withdrawn or modified, or publicly proposed or resolved to withdraw, the recommendation that DevvStream shareholders
vote in favor of DevvStream shareholder approval or DevvStream enters into a Superior Proposal (as defined in the Business Combination Agreement).
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By DevvStream upon written notice to FIAC, in the event of a breach of any representation, warranty, covenant or agreement on the part of FIAC or Amalco Sub, such that the FIAC Representation Condition or
FIAC Covenant Condition would not be satisfied at the Closing, and which, (i) with respect to any such breach that is capable of being cured, is not cured by FIAC within 30 business days after receipt of written notice thereof, or (ii) is
incapable of being cured prior to the Outside Date; provided, that DevvStream will not have the right to terminate if it is then in material breach of the Business Combination Agreement.
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By FIAC upon written notice to DevvStream, in the event of a breach of any representation, warranty, covenant or agreement on the part of DevvStream, such that DevvStream Representation Condition or
DevvStream Covenant Condition would not be satisfied at the Closing, and which, (i) with respect to any such breach that is capable of being cured, is not cured by DevvStream within 30 business days after receipt of written notice
thereof, or (ii) is incapable of being cured prior to the Outside Date; provided, that FIAC will not have the right to terminate the Business Combination Agreement if it is then in material uncured breach of the Business Combination
Agreement.
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By FIAC upon written notice to DevvStream if there has been a Company Material Adverse Effect which is not cured by DevvStream within 30 business days after receipt of written notice thereof.
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If the Proposed Transactions are consummated, New PubCo will bear expenses of the parties, including the SPAC Specified Expenses (as defined in the Business Combination Agreement), all deferred expenses, including any legal fees of the FIAC initial public offering due upon consummation of a Business Combination and any Excise Tax Liability (as defined below). The Excise Tax Liability
was incurred in connection with two meetings of the stockholders of FIAC to extend the date upon which a business combination could occur, where upon holders of an aggregate of 21,282,422 public shares of FIAC properly exercised their
right to redeem their shares. This resulted in an excise tax liability in the amount of $2,235,006 as of December 31, 2023 (the “Excise Tax Liability”).
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If (a) FIAC or DevvStream terminate the Business Combination Agreement as a result of a mutual written consent, the Required SPAC Shareholder Approval (as defined in the Business Combination
Agreement) not being obtained, or the Effective Time not occurring by the Outside Date or (b) DevvStream terminates the Business Combination Agreement due to a breach of any representation or warranty
by FIAC or Amalco Sub, then all expenses incurred in connection with the Business Combination Agreement and the Proposed Transactions will be paid by the party incurring such expenses, and no party will have any liability to any other
party for any other expenses or fees.
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If (a) FIAC or DevvStream terminate the Business Combination Agreement due to the Required Company Shareholder Approval not being obtained or (b) DevvStream terminates the Business Combination Agreement due
to a change in recommendation, or the approval, or authorization by DevvStream’s board of directors or DevvStream entering into a Superior Proposal or (c) FIAC terminates the Business Combination Agreement due to a breach of any
representation or warranty by DevvStream or a Company Material Adverse Effect, DevvStream will pay to FIAC all expenses incurred by FIAC in connection with the Business Combination Agreement and the Proposed Transactions up to the date of
such termination (including (i) SPAC Specified Expenses incurred in connection with the transactions, including SPAC Extension Expenses (as defined in the Business Combination Agreement) and (ii) any Excise Tax Liability provided that,
solely with respect to Excise Tax Liability, notice of such termination is provided after December 1, 2023).
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Sourcing, structuring, acquiring, integrating and selling businesses in and adjacent to our target sectors;
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Operating sophisticated business and non-profit organizations and executing complex transactions;
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Identifying, recruiting and developing promising talent;
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Accessing the capital markets and marketing organizations; and,
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Advising companies and boards on diverse corporate matters, including but not limited to the integration of socially positive concerns into business operations for value creation.
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Passion to fulfill our mission to develop as a successful public company using our Social-Forward criteria.
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Compelling sourcing opportunities and strategic relationships, including our highly differentiated sourcing engine provided via our relationship with secondaries investment firm Auldbrass Partners, as well as the collective networks of
our officers, directors, and advisory board members.
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Extensive influence and reach through a broad network that spans a range of leaders in business, entertainment, government and philanthropy.
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Successful track record of investing, transaction and capital markets experience that demonstrates a strong ability to source, select and execute.
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Deep insights into and subject matter expertise in a target-rich universe that provides a large total addressable market.
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Values-based leadership attractive to target businesses and with the ability to amplify and validate the efforts of a Social-Forward Company.
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Are motivated to fulfill our mission and be positioned as, or further developed as, a Social-Forward Company.
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Are excited about working with our company to realize in parallel both shareholder and social value.
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Are positioned to materially benefit from our officers’ and directors’ knowledge of the target industry and relationships.
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Have strong management teams with a clear vision to either maintaining or, if an early-stage business, creating sustainable cash flows.
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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
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cause us to depend on the marketing and sale of a single product or limited number of products or services.
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Type of Transaction
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Whether Stockholder Approval is Required
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Purchase of assets
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No
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Purchase of stock of target not involving a merger with the Company
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No
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Merger of target into a subsidiary of the Company
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No
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Merger of the Company with a target
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Yes
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we issue (other than in a public offering) shares of Class A common stock that will be equal to or in excess of 20% of the number of shares of our Class A common stock then outstanding;
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any of our directors, officers or substantial stockholders (as defined by the 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 shares of common stock or voting power of 5% or more; or
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the issuance or potential issuance of common stock will result in our undergoing a change of control.
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the timing of the transaction, including in the event we determine stockholder approval would require additional time and there is either not enough time to seek stockholder approval or doing so would place the company at a
disadvantage in the transaction or result in other additional burdens on the company;
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the expected cost of holding a stockholder vote;
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the risk that the stockholders would fail to approve the proposed business combination;
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other time and budget constraints of the company; and
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additional legal complexities of a proposed business combination that would be time-consuming and burdensome to present to stockholders.
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conduct the redemptions pursuant to Rule 143e‑4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and
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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.
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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
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file proxy materials with the SEC.
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| ITEM 1A. |
RISK FACTORS
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restrictions on the nature of our investments; and
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restrictions on the issuance of securities, each of which may make it difficult for us to complete our business combination.
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registration as an investment company;
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adoption of a specific form of corporate structure; and
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reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations.
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we have a board that includes a majority of “independent directors,” as defined under the rules of Nasdaq;
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we have a compensation committee of our board that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and
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director nominations be made, or recommended to the full board, by our independent directors or by a nominating committee of our board that is composed entirely of independent directors with a written charter or resolution addressing
the committee’s purpose and responsibilities.
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may significantly dilute the equity interest of investors in our securities;
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may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded our common stock;
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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
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may adversely affect prevailing market prices for our units, Class A common stock and/or warrants.
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default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations;
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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;
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our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;
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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;
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our inability to pay dividends on our common stock;
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other disadvantages compared to our competitors who have less debt.
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solely dependent upon the performance of a single business, property or asset; or
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| • |
dependent upon the development or market acceptance of a single or limited number of products, processes or services
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| • |
higher costs and difficulties inherent in managing cross-border business operations and complying with different commercial and legal requirements of overseas markets;
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rules and regulations regarding currency redemption;
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| • |
complex corporate withholding taxes on individuals;
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laws governing the manner in which future business combinations may be effected;
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| • |
tariffs and trade barriers;
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regulations related to customs and import/export matters;
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| • |
longer payment cycles and challenges in collecting accounts receivable;
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| • |
tax issues, such as tax law changes and variations in tax laws as compared to the United States;
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currency fluctuations and exchange controls;
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rates of inflation;
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cultural and language differences;
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| • |
employment regulations;
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crime, strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars;
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| • |
deterioration of political relations with the United States; and
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| • |
government appropriations of assets.
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a limited availability of market quotations for our securities;
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reduced liquidity for our securities;
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| • |
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;
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a limited amount of news and analyst coverage; and
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a decreased ability to issue additional securities or obtain additional financing in the future.
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| ITEM 1B. |
UNRESOLVED STAFF COMMENTS
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| Item 1C. |
CYBERSECURITY
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| ITEM 2. |
PROPERTIES
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| ITEM 3. |
LEGAL PROCEEDINGS
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| ITEM 4. |
MINE SAFETY DISCLOSURES
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| ITEM 5. |
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
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(a)
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Market Information
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(b)
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Holders
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(c)
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Dividends
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(d)
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Securities Authorized for Issuance Under Equity Compensation Plans
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(e)
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Performance Graph
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(f)
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Recent Sales of Unregistered Securities; Use of Proceeds from Registered Offerings
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(g)
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Purchases of Equity Securities by the Issuer and Affiliated Purchasers
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| ITEM 6. |
[RESERVED]
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| ITEM 7. |
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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| • |
If the Proposed Transactions are consummated, New PubCo will bear Expenses of the parties, including the SPAC Specified Expenses all deferred expenses, including any legal fees of the Initial Public Offering due upon consummation of a
Business Combination and any Excise Tax Liability.
|
| • |
If (a) FIAC or DevvStream terminate the Business Combination Agreement as a result of a mutual written consent, the Required SPAC Shareholder Approval not being obtained, or the Effective Time not occurring by the Outside Date or (b)
DevvStream terminates the Business Combination Agreement due to a breach of any representation or warranty by FIAC or Amalco Sub, then all expenses incurred in connection with the Business Combination Agreement and the Proposed
Transactions will be paid by the party incurring such expenses, and no party will have any liability to any other party for any other expenses or fees.
|
| • |
If (a) FIAC or DevvStream terminate the Business Combination Agreement due to the Required Company Shareholder Approval not being obtained or (b) DevvStream terminates the Business Combination Agreement due to a change in
recommendation, or the approval, or authorization by DevvStream’s board of directors or DevvStream entering into a Superior Proposal or (c) FIAC terminates the Business Combination Agreement due to a breach of any representation or
warranty by DevvStream or a Company Material Adverse Effect, DevvStream will pay to FIAC all expenses incurred by FIAC in connection with the Business Combination Agreement and the Proposed Transactions up to the date of such termination
(including (i) SPAC Specified Expenses incurred in connection with the transactions, including SPAC Extension Expenses and (ii) any Excise Tax Liability provided that, solely with respect to Excise Tax Liability, notice of such
termination is provided after December 1, 2023).
|
| ITEM 7A. |
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
| ITEM 8. |
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
| ITEM 9. |
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
| ITEM 9A. |
CONTROLS AND PROCEDURES
|
| (1) |
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company,
|
| (2) |
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with
authorizations of our management and directors, and
|
| (3) |
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
|
| ITEM 9B. |
OTHER INFORMATION
|
| ITEM 9C. |
DISCLOSURE REGARDING FOREIGN JURISDICTION THAT PREVENT INSPECTIONS
|
| ITEM 10. |
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
|
Name
|
Age
|
Position
|
||
|
Carl Stanton
|
55
|
Chief Executive Officer and Director
|
||
|
Ernest Lyles
|
45
|
Chief Financial Officer
|
||
|
Wray Thorn
|
52
|
Chief Investment Officer
|
||
|
Howard Sanders
|
57
|
Lead Director
|
||
|
Troy Carter
|
51
|
Director
|
||
|
Dawanna Williams
|
55
|
Director
|
||
|
Dia Simms
|
48
|
Director
|
| • |
the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm and any other 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 or any other registered public accounting firm engaged by us, and establishing pre-approval policies and
procedures;
|
| • |
reviewing and discussing with the independent registered public accounting firm all relationships they have with us in order to evaluate their continued independence;
|
| • |
setting clear hiring policies for employees or former employees of the independent registered public accounting firm;
|
| • |
setting clear policies for audit partner rotation in compliance with applicable laws and regulations;
|
| • |
reviewing and approving on an annual basis the corporate goals and objectives relevant to our Executive Officers’ compensation, evaluating our Executive Officers’ performance in light of such goals and objectives and determining and
approving the remuneration (if any) of our Executive Officers based on such evaluation;
|
| • |
reviewing and approving on an annual basis the compensation 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;
|
| • |
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 (i) to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination and a stockholder vote to
approve an amendment to our amended and restated certificate of incorporation (A) that would modify the substance or timing of our obligation to provide holders of shares of Class A common stock the right to have their shares redeemed in
connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by the Termination Date or (B) with respect to any other provision relating to the rights of
holders of our Class A commons stock and (ii) to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination by the
Termination Date (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame).
If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and
the private placement warrants will expire worthless. With certain limited exceptions, the founder shares will not be transferable, assignable by our sponsor until the earlier of: (A) one year after the completion of our initial
business combination; or (B) subsequent to our initial business combination, (x) if the closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations,
recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock
exchange, reorganization or other similar transaction that 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
placement warrants and the Class A common stock underlying such warrants, will not be transferable, assignable or saleable by our sponsor or its permitted transferees until 30 days after the completion of our initial business
combination. Since our sponsor and officers and directors may directly or indirectly own common stock and warrants following our initial public offering, 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.
|
| • |
Our sponsor, officers or directors may have a conflict of interest with respect to evaluating a business combination and financing arrangements as we may obtain loans from our sponsor or an affiliate of our sponsor or any of our
officers or directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender.
Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period.
|
| • |
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
|
|
Entity
|
|
Entity’s Business
|
|
Affiliation
|
|
Carl Stanton
|
|
Westwood Estate Wines
|
|
Food and Beverage
|
|
Managing Partner
|
|
|
cbGrowth Partners
|
|
Investments
|
|
Founder
|
|
|
Focus Impact BH3 Acquisition Company
|
Blank Check Company
|
Chief Executive Officer and Director
|
||||
|
Skipper Pets, Inc.
|
Consumer and Pet Services |
Director
|
||||
|
Ernest Lyles
|
|
The HiGro Group
|
|
Private Equity
|
|
Founder and Managing Partner
|
|
Focus Impact BH3 Acquisition Company
|
Blank Check Company
|
Chief Financial Officer and Director
|
||||
|
Wray Thorn
|
|
Clear Heights Capital
|
|
Private Equity and Venture Capital
|
|
Founder and Chief Executive Officer
|
|
|
Youth, Inc.
|
|
Nonprofit Organization
|
|
Co-Chair of Board of Directors
|
|
|
Futures and Options
|
Nonprofit Organization
|
Director and Chair of Investment Committee of Board
|
||||
|
|
Sailfish Productions
|
|
Entertainment and Media
|
|
General Manager
|
|
|
Focus Impact BH3 Acquisition Company
|
Blank Check Company
|
Chief Investment Officer and Director
|
||||
|
Skipper Pets, Inc.
|
Consumer and Pet Services |
Director
|
|
Howard Sanders
|
|
Auldbrass Partners L.P.
|
|
Private Equity
|
|
Founder and Managing Member
|
|
Troy Carter
|
|
Q&A
|
|
Technology and Multimedia
|
|
Founder and Chief Executive Officer
|
|
|
The Aspen Institute
|
|
Nonprofit Organization
|
|
Executive Member on the Board of Trustees
|
|
|
|
Los Angeles County Museum of Art
|
|
Museum
|
|
Executive Member on the Board of Trustees
|
|
|
Focus Impact BH3 Acquisition Company
|
Blank Check Company
|
Director
|
||||
|
Dawanna Williams
|
|
Dabar Development Partners
|
|
Real Estate
|
|
Managing Principal
|
|
ACRES Commercial Realty Corp.
|
Real Estate
|
Director
|
||||
|
Ares Industrial Real Estate Income Trust Inc.
|
Real Estate
|
Director
|
||||
|
Compass, Inc.
|
Real Estate
|
Director
|
||||
|
Dia Simms
|
|
Lobos 1707 Tequila & Mezcal
|
|
Food and Beverages
|
|
Chief Executive Officer
|
|
|
Tilt Holdings Inc.
|
|
Cannabis-Focused Holding Company
|
|
Director
|
|
|
Focus Impact BH3 Acquisition Company
|
Blank Check Company
|
Director
|
| ITEM 11. |
EXECUTIVE COMPENSATION
|
| ITEM 12. |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
| • |
each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock;
|
| • |
each of our executive officers and directors that beneficially owns our shares of common stock; and
|
| • |
all our executive officers and directors as a group.
|
|
Class B common stock
|
Class A common stock
|
|||||||||||||||||||
|
Name of Beneficial Owners(1)
|
Number of Shares
Beneficially
Owned(2)
|
Approximate
Percentage
of Class
|
Number of Shares
Beneficially
Owned(2)
|
Approximate
Percentage of
Class
|
Approximate
Percentage of
Common
Stock
|
|||||||||||||||
|
Five Percent Holders
|
||||||||||||||||||||
|
Focus Impact Sponsor, LLC(3) (our sponsor)
|
750,000
|
100
|
%
|
5,000,000
|
74.4
|
%
|
77.0
|
%
|
||||||||||||
|
Directors and Executive Officers
|
||||||||||||||||||||
|
Carl Stanton(4)
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
|
Ernest Lyles(4)
|
—
|
—
|
—
|
—
|
||||||||||||||||
|
Howard Sanders(4)
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
|
Troy Carter(4)
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
|
Dawanna Williams(4)
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
|
Wray Thorn(4)
|
—
|
—
|
—
|
—
|
||||||||||||||||
|
Dia Simms(4)
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
|
All officers and directors as a group (seven individuals)
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||
| (1) |
Unless otherwise noted, the business address of each of the following entities or individuals is 1345 Avenue of the Americas, 33rd Floor, New York, NY
10105.
|
| (2) |
Interests shown consist of 5,000,000 shares of Class A common stock and 750,000 shares of Class B common stock. Such shares of Class B common stock are convertible into shares of Class A common stock on a one-for-one basis, subject to
adjustment, as more fully described under the heading “Description of Securities-Founder Shares” of our final prospectus (File No. 333-255448), filed in connection with our initial public offering.
|
| (3) |
Our sponsor is governed by a four-member board of managers composed of Carl Stanton, Ernest Lyles, Howard Sanders and Wray Thorn. Each manager has one vote, and the approval of a majority of the managers is required to approve an
action of our sponsor. Under the so-called “rule of three,” if voting and dispositive decisions regarding an entity’s securities are made by three or more individuals, and a voting and dispositive decision requires the approval of a
majority of those individuals, then none of the individuals is deemed a beneficial owner of the entity’s securities. This is the situation with regard to our sponsor. Based upon the foregoing analysis, no individual manager of our
sponsor exercises voting or dispositive control over any of the securities held by our sponsor, even those in which such manager directly holds a pecuniary interest. Accordingly, none of them will be deemed to have or share beneficial
ownership of such shares. Carl Stanton, Ernest Lyles, Howard Sanders and Wray Thorn, individually and together with their controlled affiliates, collectively, have contributed approximately 40% of the capital in the sponsor.
|
| (4) |
Does not include any shares indirectly owned by this individual as a result of his membership interest in our sponsor.
|
| ITEM 13. |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
| • |
repayment of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses;
|
| • |
payment to an affiliate of our sponsor of $10,000 per month, until the Termination Date, for office space, utilities and secretarial and administrative support;
|
| • |
reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and
|
| • |
repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which
have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.00 per warrant at the option of the lender.
|
| ITEM 14. |
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
| ITEM 15. |
EXHIBITS, FINANCIAL STATEMENTS SCHEDULES
|
|
(1)
|
Financial Statements:
|
|
Page
|
|
|
Report of Independent Registered Public Accounting Firm (PCAOB ID 688)
|
F-2
|
|
Financial Statements:
|
|
|
Consolidated Balance Sheets
|
F-3
|
|
Consolidated Statements of Operation
|
F-4
|
|
Consolidated Statement of Changes in Stockholders’ Deficit
|
F-5
|
|
Consolidated Statement of Cash Flows
|
F-6
|
|
Notes to Consolidated Financial Statements
|
F-7 to F-21
|
|
(2)
|
Financial Statement Schedules:
|
|
(3)
|
Exhibits
|
|
Exhibit
|
Description
|
|
|
Business Combination Agreement, dated September 12, 2023, among the Registrant, Focus Impact Amalco Sub Ltd. and DevvStream Holdings Inc.(1)
|
||
|
Amended and Restated Certificate of Incorporation.(2)
|
||
|
Amendment to Amended and Restated Certificate of Incorporation (Extension Amendment).(3)
|
||
|
Amendment to Amended and Restated Certificate of Incorporation (Redemption Limitation Amendment).(3)
|
||
|
Amendment to Amended and Restated Certificate of Incorporation (Extension Amendment).(4)
|
||
|
Amended and Restated Bylaws.(5)
|
||
|
Warrant Agreement between Continental Stock Transfer & Trust Company and the Company.(2)
|
||
|
Description of Company’s Securities.*
|
||
|
Private Placement Warrants Purchase Agreement between the Company and the Sponsor.(2)
|
||
|
Investment Management Trust Agreement between Continental Stock Transfer & Trust Company and the Company.(2)
|
||
|
Registration and Shareholder Rights Agreement among Company and the Sponsor and certain other equityholders named therein.(2)
|
||
|
Letter Agreement between the Company, the Sponsor and the Company’s officers and directors. (2)
|
||
|
Administrative Services Agreement between the Registrant and the Sponsor.(2)
|
||
|
Promissory Note, dated May 9, 2023, between the Registrant and the Sponsor.(6)
|
||
|
Promissory Note, dated December 1, 2023, between the Registrant and the Sponsor.(7)
|
||
|
Sponsor Side Letter, dated September 12, 2023, between the Registrant and the Sponsor.(1)
|
||
|
Form of Company Support & Lock-up Agreement, dated September 12, 2023, among the Registrant, DevvStream Holdings Inc. and other parties thereto.(1)
|
||
|
Form of Amended and Restated Registration Rights Agreement.(1)
|
||
|
List of Subsidiaries.*
|
||
|
Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).*
|
||
|
Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).*
|
||
|
Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350**
|
||
|
Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350**
|
||
|
Clawback Policy.*
|
||
|
101.INS
|
iXBRL Instance Document
|
|
|
101.SCH
|
iXBRL Taxonomy Extension Schema
|
| Exhibit |
Description
|
|
|
101.CAL
|
iXBRL Taxonomy Extension Calculation Linkbase
|
|
|
101.DEF
|
iXBRL Taxonomy Extension Definition Linkbase
|
|
|
101.LAB
|
iXBRL Taxonomy Extension Label Linkbase
|
|
|
101.PRE
|
iXBRL Taxonomy Extension Presentation Linkbase
|
|
|
104
|
Cover Page Interactive Data File embedded within the iXBRL document and contained in Exhibit 101
|
| (1) |
Incorporated by reference to the registrant’s Current Report on Form 8-K, filed with the SEC on September 13, 2023.
|
| (2) |
Incorporated by reference to the registrant’s Current Report on Form 8-K, filed with the SEC on November 1, 2021.
|
| (3) |
Incorporated by reference to the registrant’s Current Report on Form 8-K, filed with the SEC on April 27, 2023.
|
| (4) |
Incorporated by reference to the registrant’s Current Report on Form 8-K, filed with the SEC on January 5, 2024.
|
| (5) |
Incorporated by reference to the registrant’s Registration Statement on Form S-1, filed with the SEC on June 3, 2021.
|
| (6) |
Incorporated by reference to the registrant’s Current Report on Form 8-K, filed with the SEC on May 9, 2023.
|
| (7) |
Incorporated by reference to the registrant’s Current Report on Form 8-K, filed with the SEC on December 7, 2023.
|
| ITEM 16. |
FORM 10-K SUMMARY
|
|
April 5, 2024
|
||
|
FOCUS IMPACT ACQUISITION CORP.
|
||
|
By:
|
/s/ Carl Stanton
|
|
|
Name: Carl Stanton
|
||
|
Title: Chief Executive Officer
|
||
|
Name
|
Position
|
Date
|
||
|
/s/ Carl Stanton
|
Chief Executive Officer and Director
|
April 5, 2024
|
||
| Carl Stanton | (Principal Executive Officer) | |||
| /s/ Ernest Lyles | Chief Financial Officer |
April 5, 2024
|
||
|
Ernest Lyles
|
(Principal Financial and Accounting Officer)
|
|||
|
/s/ Wray Thorn
|
Chief Investment Officer
|
April 5, 2024
|
||
|
Wray Thorn
|
||||
|
/s/ Howard Sanders
|
Lead Director
|
April 5, 2024
|
||
|
Howard Sanders
|
||||
|
/s/ Troy Carter
|
Director
|
April 5, 2024
|
||
| Troy Carter | ||||
|
/s/ Dawanna Williams
|
Director
|
April 5, 2024
|
||
| Dawanna Williams | ||||
|
/s/ Dia Simms
|
Director
|
April 5, 2024
|
||
|
Dia Simms
|
|
F-2
|
||||
|
Financial Statements:
|
||||
|
F-3
|
||||
|
F-4
|
||||
|
F-5
|
||||
|
F-6
|
||||
| F-7 to F-21 |
|
December 31,
|
||||||||
|
2023
|
2022
|
|||||||
|
Assets:
|
||||||||
|
Current assets:
|
||||||||
|
Cash
|
$
|
|
$
|
|
||||
| Restricted cash |
||||||||
| Income tax receivable |
||||||||
|
Prepaid expenses
|
|
|
||||||
|
Total current asset
|
|
|
||||||
|
Cash and Investment held in Trust Account
|
|
|
||||||
|
Total assets
|
$
|
|
$
|
|
||||
|
Liabilities and Stockholders’ Deficit
|
||||||||
|
Current liabilities:
|
||||||||
|
Accounts payable and accrued expenses
|
$
|
|
$
|
|
||||
|
|
||||||||
|
Franchise taxes payable
|
|
|
||||||
|
Income taxes payable
|
|
|
||||||
| Excise tax payable |
||||||||
| Redemption payable |
||||||||
|
Total current liabilities
|
|
|
||||||
|
Warrant liability
|
|
|
||||||
|
Marketing agreement
|
|
|
||||||
|
Deferred underwriting fee
|
|
|
||||||
|
Total liabilities
|
|
|
||||||
|
Commitments and Contingencies (Note 6)
|
||||||||
|
Class A common stock subject to possible redemption,
|
|
|
||||||
|
Stockholders’ Deficit:
|
||||||||
|
Preferred stock, $
|
|
|
||||||
|
Class A common stock, $
|
|
|
||||||
|
Class B common stock, $
|
|
|
||||||
|
Additional paid-in capital
|
|
|
||||||
|
Accumulated deficit
|
(
|
)
|
(
|
)
|
||||
|
Total stockholders’ deficit
|
(
|
)
|
(
|
)
|
||||
|
Total Liabilities, Class A Common Stock Subject to Possible Redemption and Stockholders’ Deficit
|
$
|
|
$
|
|
||||
|
For the Year Ended
December 31,
|
||||||||
|
2023
|
2022
|
|||||||
|
Operating costs
|
$
|
|
$
|
|
||||
|
Marketing service fee
|
|
|
||||||
|
Loss from operations
|
(
|
)
|
(
|
)
|
||||
|
Other Income
|
||||||||
|
Change in fair value of warrant liabilities
|
|
|
||||||
|
Recovery of offering costs allocated to warrants
|
||||||||
|
Operating account interest income
|
|
|
||||||
|
Income from Trust Account
|
|
|
||||||
|
Total other income
|
|
|
||||||
|
Income before provision for income taxes
|
|
|
||||||
|
Provision for income taxes
|
(
|
)
|
(
|
)
|
||||
|
Net income
|
$
|
|
$
|
|
||||
|
|
||||||||
|
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption
|
|
|
||||||
|
Basic and diluted net income per share, Class A common stock subject to possible redemption
|
$
|
|
$
|
|
||||
|
Basic and diluted weighted average shares outstanding, Class A (non-redeemable) and Class B common stock
|
|
|
||||||
|
Basic and diluted net income per share, Class A (non-redeemable) and Class B common stock
|
$
|
|
$
|
|
||||
| Class A Common Stock |
Class B Common Stock
|
Additional
|
Accumulated
|
Stockholders’
|
||||||||||||||||||||||||
| Shares | Amount |
Shares
|
Amount
|
Paid-in Capital | Deficit | Deficit | ||||||||||||||||||||||
|
Balance as of December 31, 2021
|
$ |
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
|||||||||||||||
|
Accretion for Class A common stock to redemption amount
|
— | — | ( |
) | ( |
) | ||||||||||||||||||||||
|
Net income
|
— |
—
|
|
|
|
|
||||||||||||||||||||||
|
Balance as of December 31, 2022
|
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||||||||||
|
Excise tax payable in connection with redemptions
|
— | — | ( |
) | ( |
) | ||||||||||||||||||||||
|
Extension funding of Trust Account
|
— | — | ( |
) | ( |
) | ||||||||||||||||||||||
|
Waiver of Deferred Underwriting Fee
|
— | — | ||||||||||||||||||||||||||
|
Conversion of Class B common stock to Class A common stock
|
( |
) | ( |
) | ||||||||||||||||||||||||
|
Accretion for Class A common stock to redemption amount
|
— | — | ( |
) | ( |
) | ||||||||||||||||||||||
|
Net income
|
— | — | ||||||||||||||||||||||||||
|
Balance as of December 31, 2023
|
$ |
|
$ | $ | $ | ( |
) | $ | ( |
) | ||||||||||||||||||
|
For the Year Ended
December 31,
|
||||||||
|
|
2023
|
2022
|
||||||
|
Cash flows from operating activities:
|
||||||||
|
Net income
|
$
|
|
$
|
|
||||
|
Adjustments to reconcile net income to net cash used in operating activities:
|
||||||||
|
Change in fair value of warrant liability
|
(
|
)
|
(
|
)
|
||||
|
Recovery of offering costs allocated to warrants
|
( |
) | ||||||
|
Income from investments held in Trust Account
|
(
|
)
|
(
|
)
|
||||
|
Changes in assets and liabilities:
|
||||||||
|
Prepaid expenses
|
|
|
||||||
|
Accounts payable and accrued expenses
|
|
|
||||||
|
Franchise tax payable
|
(
|
)
|
|
|||||
|
Marketing service fee
|
|
|
||||||
|
Due to related party
|
||||||||
|
Income taxes payable
|
(
|
)
|
(
|
)
|
||||
|
Net cash used in operating activities
|
(
|
)
|
(
|
)
|
||||
|
|
||||||||
|
Cash flows from investing activities:
|
||||||||
|
Trust extension funding
|
( |
) | ||||||
|
Cash withdrawn from Trust Account in connection with redemption
|
||||||||
|
Cash withdrawn from Trust Account to pay taxes obligation
|
||||||||
|
Net cash provided by investing activities
|
|
|
||||||
|
|
||||||||
|
Cash flows from financing activities:
|
||||||||
|
Redemption of common stock
|
( |
) | ||||||
|
Proceeds from issuance of promissory note to related party
|
||||||||
|
Net cash used in financing activities
|
(
|
)
|
|
|||||
|
|
||||||||
|
Net change in cash
|
(
|
)
|
|
|||||
|
Cash, beginning of the year
|
|
|
||||||
|
Cash, end of the year
|
$
|
|
$
|
|
||||
|
|
||||||||
|
Supplemental disclosure of cash flow information:
|
||||||||
|
Remeasurement adjustment of carrying value of Class A common stock to redemption amount
|
$ |
$ |
||||||
|
Conversion of Class B common stock to Class A common stock
|
$ |
$ |
||||||
|
Excise tax payable in connection with redemption
|
$ |
$ |
||||||
|
Impact of the waiver of deferred commission by the underwriters
|
$ |
$ |
||||||
|
Payable to redeemable shareholders
|
$ |
$ |
||||||
|
Income taxes paid
|
$ |
$ |
||||||
| (a) |
prior to the Effective Time, FIAC will continue (the “FIAC Continuance”) from the State of Delaware under the Delaware General Corporation Law (“DGCL”) to the Province of Alberta under the Business Corporations Act (Alberta)
(“ABCA”) and change its name to DevvStream Corp. (“New PubCo”).
|
| (b) |
following the FIAC Continuance, and in accordance with the applicable provisions of the Plan of Arrangement and the Business Corporations Act (British Columbia) (the “BCBCA”), Amalco Sub and DevvStream will amalgamate to form
one corporate entity (“Amalco”) in accordance with the terms of the BCBCA (the “Amalgamation”), and as a result of the Amalgamation, (i) each Company Share issued and outstanding immediately prior to the Effective Time will be
automatically exchanged for that certain number of New PubCo Common Shares equal to the applicable Per Common Share Amalgamation Consideration, (ii) each Company Option and Company RSU issued and outstanding immediately prior to
the Effective Time will be cancelled and converted into Converted Options and Converted RSUs, respectively, in an amount equal to the Company Shares underlying such Company Option or Company RSU, respectively, multiplied by the
Common Conversion Ratio (and, for Company Options, at an adjusted exercise price equal to the exercise price for such Company Option prior to the Effective Time divided by the Common Conversion Ratio), (iii) each Company Warrant
issued and outstanding immediately prior to the Effective Time shall become exercisable for New PubCo Common Shares in an amount equal to the Company Shares underlying such Company Warrant multiplied by the Common Conversion Ratio
(and at an adjusted exercise price equal to the exercise price for such Company Warrant prior to the Effective Time divided by the Common Conversion Ratio), (iv) each holder of Company Convertible Notes, if any, issued and
outstanding immediately prior to the Effective Time will first receive Company Shares and then New PubCo Common Shares in accordance with the terms of such Company Convertible Notes and (v) each common share of Amalco Sub issued
and outstanding immediately prior to the Effective Time will be automatically exchanged for
|
| (c) |
Simultaneously with the execution of the Business Combination Agreement, FIAC and Focus Impact Sponsor, LLC, a Delaware limited liability company (“FIAC Sponsor”) entered into a Sponsor Side Letter, pursuant to which, among
other things, FIAC Sponsor agreed to forfeit (i)
|
| (d) |
In addition, contemporaneously with the execution of the Business Combination Agreement, DevvStream, FIAC and each of Devvio, Inc., the majority and controlling shareholder of DevvStream, and DevvStream’s directors and officers
(the “Core Company Securityholders”) entered into Company Support & Lock-Up Agreements (the “Company Support Agreements”), pursuant to which, among other things, (i) each of the Core Company Securityholders agreed to vote any
Company Shares held by him, her or it in favor of the Business Combination Agreement, the Arrangement Resolution and the Proposed Transactions, and provided customary representations and warranties and covenants related to the
foregoing, and (ii) each of the Core Company Securityholders has agreed to certain transfer restrictions with respect to DevvStream securities prior to the Effective Time and lock-up restrictions with respect to the New PubCo
Common Shares to be received by such Core Company Securityholder under the Business Combination Agreement, which lock-up restrictions are consistent with those agreed to by FIAC Sponsor in the Sponsor Side Letter.
|
| • |
If the Proposed Transactions are consummated, New PubCo will bear Expenses of the parties, including the SPAC Specified Expenses and any Excise Tax Liability (as defined below).
|
| • |
If (a) FIAC or DevvStream terminate the Business Combination Agreement as a result of a mutual written consent, the Required SPAC Shareholder Approval not being obtained, or the Effective Time not occurring by the Outside Date
or (b) DevvStream terminates the Business Combination Agreement due to a breach of any representation or warranty by FIAC or Amalco Sub, then all Expenses incurred in connection with the Business Combination Agreement and the
Proposed Transactions will be paid by the party incurring such Expenses, and no party will have any liability to any other party for any other expenses or fees.
|
| • |
If (a) FIAC or DevvStream terminate the Business Combination Agreement due to the Required Company Shareholder Approval not being obtained or (b) DevvStream terminates the Business Combination Agreement due to a Change in
Recommendation by DevvStream’s board of directors or DevvStream entering into a Superior Proposal or (c) FIAC terminates the Business Combination Agreement due to a breach of any representation or warranty by DevvStream or a
Company Material Adverse Effect, DevvStream will pay to FIAC all Expenses incurred by FIAC in connection with the Business Combination Agreement and the Proposed Transactions up to the date of such termination (including (i) SPAC
Specified Expenses incurred in connection with the transactions, including SPAC Extension Expenses and (ii) any Excise Tax Liability provided that, solely with respect to Excise Tax Liability, notice of such termination is
provided after December 1, 2023).
|
|
For the Year Ended December 31,
|
||||||||||||||||
|
2023
|
2022 |
|||||||||||||||
|
Redeemable Class A
|
Non-redeemable Class A and Class B
|
Redeemable Class A | Non-redeemable Class A and Class B | |||||||||||||
|
Basic and diluted net income per share
|
||||||||||||||||
|
Numerator:
|
||||||||||||||||
|
Allocation of net income
|
$
|
|
$
|
|
$ | $ | ||||||||||
|
Denominator:
|
||||||||||||||||
|
Weighted average shares outstanding
|
|
|
||||||||||||||
|
Basic and diluted net income per share
|
$
|
|
$
|
|
$ |
$ |
||||||||||
|
December 31, 2023
|
December 31, 2022
|
|||||||
|
As of beginning of the period
|
$ | $ | ||||||
|
Less:
|
||||||||
|
Redemptions
|
(
|
)
|
||||||
|
Plus:
|
||||||||
|
Extension funding of Trust Account
|
||||||||
|
Remeasurement adjustment of carrying value to redemption value
|
|
|||||||
|
Class A common stock subject to possible redemption
|
$
|
|
$ | |||||
| • |
in whole and not in part;
|
| • |
at a price of $
|
| • |
upon a minimum of
|
| • |
if, and only if, the closing price of the Class A common stock equals or exceeds $
|
| • |
in whole and not in part;
|
| • |
at $
|
| • |
if, and only if, the closing price of the Company’s Class A common stock equals or exceeds $
|
| • |
if the closing price of the Class A common stock for any
|
| December 31, 2023 |
||||||||||||
|
Level 1
|
Level 2
|
Level 3
|
||||||||||
|
Assets
|
||||||||||||
|
Investments held in Trust Account
|
$
|
|
$
|
|
$
|
|
||||||
|
Liabilities
|
||||||||||||
|
Public Warrants
|
$
|
|
$
|
|
$
|
|
||||||
|
Private Warrants
|
$
|
|
$
|
|
$
|
|
||||||
| Working Capital Loan Conversion Option |
$ |
$ |
$ |
|||||||||
| December 31, 2022 |
||||||||||||
|
Level 1
|
Level 2
|
Level 3
|
||||||||||
|
Assets
|
||||||||||||
|
Investments held in Trust Account
|
$
|
|
$
|
|
$
|
|
||||||
|
Liabilities
|
||||||||||||
|
Public Warrants
|
$
|
|
$
|
|
$
|
|
||||||
|
Private Warrants
|
$
|
|
$
|
|
$
|
|
||||||
|
Input
|
December 31, 2023
|
December 31, 2022 | ||||||
|
Risk-free interest rate
|
|
%
|
% | |||||
|
Expected term to initial Business Combination (years)
|
|
|||||||
|
Expected volatility
|
de minimis
|
% | de minimis | |||||
|
Common stock price
|
$
|
|
$ |
|||||
|
Dividend yield
|
|
%
|
% | |||||
| Fair value of the Private Placement Warrants measured with level 3 |
||||
|
December 31, 2021
|
$
|
|
||
|
|
(
|
)
|
||
|
December 31, 2022
|
$
|
|
||
|
December 31, 2022
|
$
|
|
||
|
|
(
|
)
|
||
|
December 31, 2023
|
$
|
|
| December 31, | December 31, | |||||||
|
2023
|
2022
|
|||||||
|
Deferred tax asset
|
||||||||
|
Federal net operating loss
|
$
|
|
$ | |||||
|
Organizational costs/Startup expenses
|
|
|||||||
|
Total deferred tax asset
|
|
|||||||
|
Valuation allowance
|
(
|
)
|
( |
) | ||||
|
Deferred tax asset, net of allowance
|
$
|
|
$ | |||||
| December 31, | December 31, | |||||||
|
2023
|
2022
|
|||||||
|
Federal
|
||||||||
|
Current
|
$
|
|
$ | |||||
|
Deferred
|
(
|
)
|
( |
) | ||||
|
State and Local
|
||||||||
|
Current
|
|
|||||||
|
Deferred
|
(
|
)
|
||||||
|
Change in valuation allowance
|
|
|||||||
|
Income tax provision
|
$
|
|
$ | |||||
| December 31, | December 31, | |||||||
|
2023
|
2022
|
|||||||
|
Statutory federal income tax rate
|
|
%
|
% | |||||
|
State taxes, net of federal tax benefit
|
|
%
|
% | |||||
|
Tax penalty
|
% | % | ||||||
|
Change in fair value of warrant liability
|
(
|
)%
|
( |
)% | ||||
|
Warrant transaction costs
|
( |
)% | % | |||||
|
Business Combination expenses
|
% | % | ||||||
|
Change in valuation allowance
|
|
%
|
% | |||||
|
Income tax provision
|
|
%
|
% | |||||
| • |
“Auldbrass Partners” are to Auldbrass Partners, L.P., an investment management fund and investor in our sponsor;
|
| • |
“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 the offering, and the shares of our Class A common stock issued upon the conversion thereof;
|
| • |
“initial public offering” are to our initial public offering consummated on November 1, 2021.
|
| • |
“initial stockholders” are to holders of our founder shares prior to our initial public offering;
|
| • |
“management” or our “management team” are to our officers and directors, and “directors” are to our current directors;
|
| • |
“private placement warrants” are to the warrants issued to our sponsor in a private placement simultaneously with the closing of the offering;
|
| • |
“public shares” are to shares of our Class A common stock sold as part of the units in the 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;
|
| • |
“sponsor” are to Focus Impact Sponsor, LLC, a Delaware limited liability company;
|
| • |
“trust account” are to the trust account established in connection with our initial public offering;
|
| • |
“we,” “us,” “our,” “company,” or the “company” are to Focus Impact Acquisition Corp.
|
| • |
in whole and not in part;
|
| • |
at a price of $0.01 per warrant;
|
| • |
upon a minimum of 30 days’ prior written notice of redemption to each warrant holder; and
|
| • |
if, and only if, the closing price of the Class A common stock equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading
“—Warrants—Public Stockholders’ Warrants—Anti-dilution Adjustments”) for any 20 trading days within a 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders.
|
| • |
in whole and not in part;
|
| • |
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by
reference to the table below, based on the redemption date and the “fair market value” of our Class A common stock (as defined below) except as otherwise described below;
|
| • |
if, and only if, the closing price of our Class A common stock equals or exceeds $10.00 per public share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the
heading “—Warrants—Public Stockholders’ Warrants—Anti-dilution Adjustments”) for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders; and
|
| • |
if the closing price of the Class A common stock for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders is less than $18.00
per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “—Warrants—Public Stockholders’ Warrants—Anti-dilution Adjustments”), the private
placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above.
|
|
Redemption Date
|
Fair Market Value of Class A Common Stock
|
||||||||
|
(period to expiration of warrants)
|
≤$10.00
|
11.00
|
12.00
|
13.00
|
14.00
|
15.00
|
16.00
|
17.00
|
≥18.00
|
|
60 months
|
0.261
|
0.281
|
0.297
|
0.311
|
0.324
|
0.337
|
0.348
|
0.358
|
0.361
|
|
57 months
|
0.257
|
0.277
|
0.294
|
0.310
|
0.324
|
0.337
|
0.348
|
0.358
|
0.361
|
|
54 months
|
0.252
|
0.272
|
0.291
|
0.307
|
0.322
|
0.335
|
0.347
|
0.357
|
0.361
|
|
51 months
|
0.246
|
0.268
|
0.287
|
0.304
|
0.320
|
0.333
|
0.346
|
0.357
|
0.361
|
|
48 months
|
0.241
|
0.263
|
0.283
|
0.301
|
0.317
|
0.332
|
0.344
|
0.356
|
0.361
|
|
45 months
|
0.235
|
0.258
|
0.279
|
0.298
|
0.315
|
0.330
|
0.343
|
0.356
|
0.361
|
|
42 months
|
0.228
|
0.252
|
0.274
|
0.294
|
0.312
|
0.328
|
0.342
|
0.355
|
0.361
|
|
39 months
|
0.221
|
0.246
|
0.269
|
0.290
|
0.309
|
0.325
|
0.340
|
0.354
|
0.361
|
|
36 months
|
0.213
|
0.239
|
0.263
|
0.285
|
0.305
|
0.323
|
0.339
|
0.353
|
0.361
|
|
33 months
|
0.205
|
0.232
|
0.257
|
0.280
|
0.301
|
0.320
|
0.337
|
0.352
|
0.361
|
|
30 months
|
0.196
|
0.224
|
0.250
|
0.274
|
0.297
|
0.316
|
0.335
|
0.351
|
0.361
|
|
27 months
|
0.185
|
0.214
|
0.242
|
0.268
|
0.291
|
0.313
|
0.332
|
0.350
|
0.361
|
|
24 months
|
0.173
|
0.204
|
0.233
|
0.260
|
0.285
|
0.308
|
0.329
|
0.348
|
0.361
|
|
21 months
|
0.161
|
0.193
|
0.223
|
0.252
|
0.279
|
0.304
|
0.326
|
0.347
|
0.361
|
|
18 months
|
0.146
|
0.179
|
0.211
|
0.242
|
0.271
|
0.298
|
0.322
|
0.345
|
0.361
|
|
15 months
|
0.130
|
0.164
|
0.197
|
0.230
|
0.262
|
0.291
|
0.317
|
0.342
|
0.361
|
|
12 months
|
0.111
|
0.146
|
0.181
|
0.216
|
0.250
|
0.282
|
0.312
|
0.339
|
0.361
|
|
9 months
|
0.090
|
0.125
|
0.162
|
0.199
|
0.237
|
0.272
|
0.305
|
0.336
|
0.361
|
|
6 months
|
0.065
|
0.099
|
0.137
|
0.178
|
0.219
|
0.259
|
0.296
|
0.331
|
0.361
|
|
3 months
|
0.034
|
0.065
|
0.104
|
0.150
|
0.197
|
0.243
|
0.286
|
0.326
|
0.361
|
|
0 months
|
—
|
—
|
0.042
|
0.115
|
0.179
|
0.233
|
0.281
|
0.323
|
0.361
|
| • |
if we are unable to complete our initial business combination within 30 months from the closing of our initial public offering, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible
but not more than ten business days thereafter subject to lawfully available funds therefor, redeem 100% of the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including
interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public
shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably
possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and
the requirements of other applicable law;
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prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote as a class with our public shares (a) on our
initial business combination or on any other proposal presented to stockholders prior to or in connection with the completion of an initial business combination or (b) to approve an amendment to our amended and restated certificate of
incorporation to (x) extend the time we have to consummate a business combination beyond 30 months from the closing of our initial public offering or (y) amend the foregoing provisions;
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although we do not intend to enter into a business combination with a target business that is affiliated with or related to Auldbrass Partners or our sponsor, officers, directors or members of our advisory board we are not prohibited from
doing so. In the event we enter into such a transaction, a committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation
opinions that such a business combination is fair to our company from a financial point of view;
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if a stockholder vote on our initial business combination is not required by law and we do not decide to hold a stockholder vote for business or other legal reasons, we will offer to redeem our public shares pursuant to Rule 143e‑4 and
Regulation 14E of the Exchange Act, and will file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about our initial business
combination and the redemption rights as is required under Regulation 14A of the Exchange Act. Whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq, we will provide our public stockholders with the
opportunity to redeem their public shares by one of the two methods listed above;
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| • |
our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of our assets held in the trust account (excluding the deferred underwriting commissions and
taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination;
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| • |
if our stockholders approve an amendment to our amended and restated certificate of incorporation that would affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our business
combination within 30 months from the closing of our initial public offering or with respect to any other provisions relating to the rights of holders of our Class A common stock, we will provide our public stockholders with the opportunity
to redeem all or a portion of their shares of Class A common stock upon such approval at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in
the trust account and not previously released to us to pay our franchise and income taxes, divided by the number of then outstanding public shares; and
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we will not effectuate our initial business combination with another blank check company or a similar company with nominal operations.
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prior to such time, our board of directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
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| • |
upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of our voting stock outstanding at the time the transaction commenced, excluding
certain shares; or
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| • |
at or subsequent to that time, the business combination is approved by our board of directors and by the affirmative vote of holders of at least 66 2⁄3% of the outstanding voting stock that is not owned by the interested stockholder.
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1% of the total number of shares of common stock then-outstanding, which equals 17,175 shares as of December 31, 2023; or
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| • |
the average weekly reported trading volume of the common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.
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| • |
the issuer of the securities that was formerly a shell company has ceased to be a shell company;
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| • |
the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act; and
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| • |
the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding twelve months (or such shorter period that the issuer was required to file such reports and materials),
other than Form 8-K reports; and at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company.
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Name of Subsidiary
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Jurisdiction of Organization
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Focus Impact Amalco Sub Ltd.
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British Columbia, Canada
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Date: April 5, 2024
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By:
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/s/ Carl Stanton
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Name: Carl Stanton
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||
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Title: Chief Executive Officer
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||
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(Principal Executive Officer)
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Date: April 5, 2024
|
By:
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/s/ Ernest Lyles
|
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Name: Ernest Lyles
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||
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Title: Chief Financial Officer
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||
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(Principal Financial Officer and Accounting Officer)
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Date: April 5, 2024
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By:
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/s/ Carl Stanton
|
|
Name: Carl Stanton
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||
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Title: Chief Executive Officer
|
||
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(Principal Executive Officer)
|
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Date: April 5, 2024
|
By:
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/s/ Ernest Lyles
|
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Name: Ernest Lyles
|
||
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Title: Chief Financial Officer
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||
|
(Principal Financial Officer and Accounting Officer)
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| • |
requiring reimbursement of cash Incentive-Based Compensation previously paid;
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| • |
seeking recovery of any gain realized on the vesting, exercise, settlement, sale, transfer, or other disposition of any equity-based awards granted as Incentive-Based Compensation;
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| • |
offsetting any or all of the Overpayment from any compensation otherwise owed by the Company to the Covered Executive;
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| • |
cancelling outstanding vested or unvested equity awards; and/or
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| • |
taking any other remedial or recovery action permitted by law, as determined by the Compensation Committee.
|
Organization and Business Operations |
12 Months Ended | |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2023 | ||||||||||||||||||||||
| Organization and Business Operations [Abstract] | ||||||||||||||||||||||
| Organization and Business Operations |
Note 1 - Organization and Business
Operations
Organization and General
Focus Impact Acquisition Corp. (the “Company”) is a blank check company incorporated in Delaware on February 23, 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 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.
As of December 31, 2023, the Company had not commenced any operations. All activity for the period from February 23, 2021 (inception)
through December 31, 2023 relates to the Company’s formation and the Initial Public Offering (“IPO”) (as defined 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 on cash and cash equivalents from the proceeds
derived from the IPO.
Sponsor and Financing
The Company’s sponsor is Focus Impact Sponsor, LLC, a Delaware limited liability company (the “Sponsor”).
The registration statement for the Company’s IPO was declared effective on October 27, 2021 (the “Effective Date”). On November 1, 2021, the
Company consummated its IPO of 23,000,000 units (the “Units”) which included the exercise of the underwriters’ option to purchase
an additional 3,000,000 Units at the IPO price to cover over-allotments. Each Unit consists of one share of Class A common stock, $0.0001
par value per share (the “Class A common stock”), and of one redeemable warrant (the “Public Warrants”), each whole
Public Warrant entitling the holder thereof to purchase one share of Class A Common Stock at an exercise price of $11.50 per share, subject to adjustment. The Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $230,000,000,
which is discussed in Note 3.
Simultaneously with the closing of IPO the Company completed the private sale of 11,200,000 warrants (the “Private Placement Warrants”) at a purchase price of $1.00 per Private Placement Warrant to the Sponsor, generating gross proceeds to the Company of $11,200,000.
Upon the closing of the IPO (including the full exercise of the underwriters’ over-allotment option) and the private placement, $234,600,000 has been placed in a trust account (the “Trust Account”), representing the redemption value of the Class A common stock sold in the
IPO, at their redemption value of $10.20 per share.
Nasdaq rules provide that the Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the value of the assets held in the Trust Account (as defined below) (excluding the deferred underwriting commissions and taxes payable) at the time of the Company signing a definitive agreement in
connection with the Business Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the
Investment Company Act of 1940, as amended (the “Investment Company Act”). There is no assurance that the Company will be able to successfully effect a Business Combination.
Upon the closing of the IPO, $10.20
per Unit sold in the IPO (including the full exercise of the underwriters’ over-allotment option) and the proceeds of the sale of the Private Placement Warrants, are held in a trust account (“Trust Account”) and will be invested only in U.S.
government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. The trust account
is intended as a holding place for funds pending the earliest to occur of: (a) the completion of the initial Business Combination, (b) the redemption of any public shares properly tendered in connection with a stockholder vote to amend the
Company’s amended and restated certificate of incorporation (i) to modify the substance or timing of the Company’s obligation to provide holders of the Company’s Class A common stock the right to have their shares redeemed in connection with
the initial Business Combination or to redeem 100% of the Company’s public shares if the Company does not complete the initial
Business Combination by May 1, 2024, which can be extended to November 1, 2024 (with required funding in the Trust Account) or (ii) with respect to any other provisions relating to the rights of holders of the Company’s Class A common stock,
and (c) the redemption of the Company’s public shares if the Company has not consummated the initial Business Combination by May 1, 2024, which can be extended to November 1, 2024 (with required funding in the Trust Account) subject to
applicable law.
The Company will provide its public stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock
upon the completion of the initial Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek
stockholder approval of a proposed Business Combination or conduct a tender offer will be made by the Company, solely in the Company’s discretion, and will be based on a variety of factors such as the timing of the transaction and whether the
terms of the transaction would require the Company to seek stockholder approval under the law or stock exchange listing requirement. The public stockholders will be entitled to redeem their shares at a per-share price, payable in cash, equal
to the aggregate amount then on deposit in the Trust Account as of business days prior to the consummation of the initial
Business Combination including interest earned on the funds held in the Trust Account and not previously released to the Company to pay its franchise and income taxes, divided by the number of then outstanding public shares, subject to the
limitations. The amount in the Trust Account is initially anticipated to be approximately $10.20 per public share. All of the
Public Shares contain a redemption feature which allows for the redemption of such Public Shares in connection with the Company’s liquidation, if there is a stockholder vote or tender offer in connection with an initial Business Combination
and in connection with certain amendments to the amended and restated certificate of incorporation. In accordance with SEC and its guidance on redeemable equity instruments, which has been codified in ASC 480-10-S99, redemption provisions not
solely within the control of a company require common stock subject to redemption to be classified outside of permanent equity. Given that the Public Shares will be issued with other freestanding instruments (i.e., public warrants), the
initial carrying value of Class A common stock classified as temporary equity will be the allocated proceeds determined in accordance with ASC 470-20. The Class A common stock is subject to ASC 480-10-S99. If it is probable that the equity
instrument will become redeemable, the Company has the option to either (i) accrete changes in the redemption value over the period from the date of issuance (or from the date that it becomes probable that the instrument will become
redeemable, if later) to the earliest redemption date of the instrument or (ii) recognize changes in the redemption value immediately as they occur and adjust the carrying amount of the instrument to equal the redemption value at the end of
each reporting period. The Company has elected to recognize the changes immediately. The accretion or remeasurement will be treated as a deemed dividend (i.e., a reduction to retained earnings, or in absence of retained earnings, additional
paid-in capital). While redemptions cannot cause the Company’s net tangible assets to fall below $5,000,001, the Public Shares are
redeemable and will be classified as such on the balance sheet until such date that a redemption event takes place. In such case, the Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the issued and
outstanding shares voted are voted in favor of the Business Combination.
The Company’s amended and restated certificate of incorporation provides that the Company will have until the Termination Date (as defined
below) to complete the initial Business Combination. If the Company does not complete the initial Business Combination by the Termination Date, the Company will: (i) cease all operations except for the purpose of winding up; (ii) as promptly
as reasonably possible but not more than business days thereafter, redeem the public shares, at a per-share price, payable in
cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay the Company’s franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely
extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law; and (iii) as promptly as reasonably possible following such redemption, subject to
the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of
other applicable law.
The Sponsor, officers and directors entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their
redemption rights with respect to any founder shares and public shares held by them in connection with the completion of the initial Business Combination and a stockholder vote to approve an amendment to the Company’s amended and restated
certificate of incorporation (A) that would modify the substance or timing of the Company’s obligation to provide holders of shares of Class A common stock the right to have their shares redeemed in connection with the initial Business
Combination or to redeem 100% of the Company’s public shares if the Company does not complete the initial Business Combination by
May 1, 2024, which can be extended to November 1, 2024 (with required funding in the Trust Account) or (B) with respect to any other provision relating to the rights of holders of the Company’s Class A commons stock and (ii) to waive their
rights to liquidating distributions from the trust account with respect to any founder shares they hold if the Company fails to consummate an initial Business Combination by May 1, 2024, which can be extended to November 1, 2024 (with
required funding in the Trust Account) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if the Company fails to complete the initial Business Combination within
the prescribed time frame). Further, the Company has agreed not to enter into a definitive agreement regarding an initial Business Combination without the prior consent of the Sponsor. If the Company submits the initial Business Combination
to the Company’s public stockholders for a vote, the Company will complete the initial Business Combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial Business Combination.
The Sponsor has agreed that it will be liable to the Company if and to the extent any claims by a vendor for services rendered or products
sold to the Company, or by a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.20 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in
the value of the trust assets, in each case net of the interest which may be withdrawn to pay the Company’s franchise and income taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and
all rights to seek access to the trust account and except as to any claims under the Company’s indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event
that an executed waiver is deemed to be unenforceable against a third party, then the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company has not independently verified whether the Sponsor
has sufficient funds to satisfy its indemnity obligations and believes that the Sponsor’s only assets are securities of the Company. The Company has not asked the Sponsor to reserve for such indemnification obligations. None of the Company’s
officers will indemnify the Company for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
Extension of Combination Period
On April 25, 2023, the Company held a special meeting of stockholders (the “Extension Meeting”) to amend the Company’s amended and restated
certificate of incorporation to (i) extend the date (the “Termination Date”) by which the Company has to consummate a Business Combination from May 1, 2023 (the “Original Termination Date”) to August 1, 2023 (the “Charter Extension Date”) and
to allow the Company, without another shareholder vote, to elect to extend the Termination Date to consummate a Business Combination on a monthly basis for up to nine times by an additional one month each time after the Charter Extension Date, by resolution
of the Company’s board of directors if requested by the Sponsor, and upon five days’ advance notice prior to the applicable
Termination Date, until May 1, 2024, or a total of up to twelve months after the Original Termination Date, unless the closing of
the Company’s initial Business Combination shall have occurred prior to such date (such amendment, the “Extension Amendment” and such proposal, the “Extension Amendment Proposal”) and (ii) remove the limitation that the Company may not redeem
shares of public stock to the extent that such redemption would result in the Company having net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Securities Exchange Act of 1934, as amended, of less than $5,000,000 (such amendment, the “Redemption Limitation Amendment” and such proposal, the “Redemption Limitation Amendment Proposal”). The
shareholders of the Company approved the Extension Amendment Proposal and the Redemption Limitation Amendment at the Extension Meeting and on April 26, 2023, the Company filed the Extension Amendment and the Redemption Limitation Amendment
with the Secretary of State of Delaware.
In connection with the vote to approve the Extension Amendment Proposal and the Redemption Limitation Amendment Proposal, the holders of 17,297,209 shares of Class A common stock, par value $0.0001
per share, of the Company properly exercised their right to redeem their shares for cash at a redemption price of approximately $10.40
per share, for an aggregate redemption amount of $179,860,588.
As disclosed in the proxy statement relating to the Extension Meeting, the Sponsor agreed that if the Extension Amendment Proposal is
approved, it or one or more of its affiliates, members or third-party designees (the “Lender”) will contribute to the Company as a loan, within ten (10)
business days of the date of the Extension Meeting, of the lesser of (a) an aggregate of $487,500 or (b) $0.0975 per share that is not redeemed in connection with the Extension Meeting, to be deposited into the Trust Account. In addition, in the event
the Company does not consummate an initial business combination by August 1, 2023, the Lender may contribute to the Company the lesser of (a) $162,500
or (b) $0.0325 per each share of public stock that is not redeemed in connection with the Extension Meeting as a loan to be
deposited into the Trust Account for each of nine one-month extensions following August 1, 2023. On October 31, 2023, the Company deposited an additional $162,500
in the Trust Account to extend the Termination Date to December 1, 2023. On December 1, 2023, the Company deposited an additional $162,500
in the Trust Account to extend the Termination Date to January 1, 2024. As of December 31, 2023 a total of $1,300,000 has been paid
regarding the extensions.
In association with the approval of the Extension Amendment Proposal, on May 9, 2023, the Company issued an unsecured promissory note in the
total principal amount of up to $1,500,000 (the “Promissory Note”) to the Sponsor and the Sponsor funded deposits into the Trust
Account. The Promissory Note does not bear interest and matures upon closing of the Company’s initial Business Combination. In the event that the Company does not consummate a Business Combination, the Promissory Note will be repaid only from
amounts remaining outside of the Trust Account, if any. Up to the total principal amount of the Promissory Note may be converted, in whole or in part, at the option of the Lender into warrants of the Company at a price of $1.00 per warrant, which warrants will be identical to the Private Placement Warrants issued to the Sponsor at the time of the IPO.
On December 29, 2023, the Company held a special meeting of stockholders (the “Extension Meeting 2”) to amend the Company’s amended and
restated certificate of incorporation to (i) extend the Termination Date from January 1, 2024 to April 1, 2024 (the “Charter Extension Date 2”) and to allow the Company, without another stockholder vote, to elect to extend the Termination
Date to consummate a business combination on a monthly basis for up to seven times by an additional one month each time after the Charter Extension Date 2, by resolution of the Company’s board of directors if requested by the Sponsor, and upon five days’ advance notice prior to the applicable Termination Date, until November 1, 2024, or a total of up to ten months after January 1, 2024, unless the closing of the Company’s initial Business Combination shall have occurred prior to such date (such
amendment, the “Extension Amendment 2” and such proposal, the “Extension Amendment Proposal 2”). The stockholders of the Company approved the Extension Amendment Proposal 2 at the Extension Meeting 2 and on December 29, 2023, the Company
filed the Extension Amendment 2 with the Secretary of State of Delaware.
In connection with the vote to approve the Extension Amendment Proposal 2, the holders of 3,985,213 shares of Class A common stock properly exercised their right to redeem their shares for cash at a redemption price of approximately $10.95 per share, for an aggregate redemption amount of approximately $43,640,022. As of December 31, 2023, funds related to these redemptions have not been distributed and are reported on the consolidated balance sheet as redemption
payable.
Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard
On October 16, 2023, the Company, received a written notice (the “Notice”) from the Listing Qualifications Department of the Nasdaq Stock
Market LLC (“Nasdaq”) notifying the Company that it was no longer in compliance with Nasdaq Listing Rule 5450(a)(2), which requires a minimum of 400
total holders for continued listing on the Nasdaq Global Market (the “Minimum Public Holders Rule”).
Based on the Company’s plan of compliance submitted to Nasdaq on November 17, 2023, Nasdaq granted the Company an extension until April 15,
2024 to regain compliance with the Minimum Public Holders Rule. In the event the Company does not regain compliance with the Minimum Public Holders Rule, Nasdaq will provide written notification that the Company’s securities will be delisted.
At that time, the Company may appeal Nasdaq’s determination to a Listing Qualifications Panel.
Additionally, on December 21, 2023, the Sponsor, converted 5,000,000 shares of the company’s Class B common stock to Class A common stock. The converted shares of Class A common stock hold no interest in the Trust Account and are non-redeemable.
Proposed Business Combination
On September 12, 2023, Focus Impact Acquisition Corp., a Delaware corporation (“FIAC”) entered into a Business Combination Agreement (as may
be amended, supplemented or otherwise modified from time to time, the “Business Combination Agreement” and the transactions contemplated thereby, collectively, the “Business Combination”), by and among FIAC, Focus Impact Amalco Sub Ltd., a
wholly-owned subsidiary of FIAC and a company existing under the laws of the Province of British Columbia (“Amalco Sub”) and DevvStream Holdings Inc., a company existing under the Laws of the Province of British Columbia (“Devvstream”).
Pursuant to the Business Combination Agreement, among other things FIAC will acquire DevvStream for consideration of shares in FIAC following its continuance to the Province of Alberta (as further explained below). The terms of the Business
Combination Agreement, which contains customary representations and warranties, covenants, closing conditions and other terms relating to the mergers and the other transactions contemplated thereby, are summarized below.
Structure of the Business Combination
The
acquisition is structured as a continuance followed by an amalgamation transaction, resulting in the following:
Consideration
The aggregate consideration to be paid to DevvStream shareholders and securityholders is that number of New PubCo Common Shares (or, with
respect to Company Options, Company RSUs and Company Warrants, a number of Converted Options, Converted Options and Converted Warrants consistent with the aforementioned conversion mechanics) equal to (a) (i) $145 million plus (ii) the aggregate exercise price of all in-the-money options and warrants immediately prior to the Effective Time (or exercised
in cash prior to the Effective Time) divided by (b) $10.20 (the “Share Consideration”). The Share Consideration is allocated among
DevvStream shareholders and securityholders as set forth in the Business Combination Agreement.
Closing
The Closing will be on a date no later than
Business Days following the satisfaction or waiver of all of the closing conditions. It is expected that the Closing will occur on or before June 12, 2024. The Business Combination Agreement contains customary representations, warranties and
covenants of (a) DevvStream and (b) FIAC and Amalco Sub relating to, among other things, their ability and authority to enter into the Business Combination Agreement and their capitalization and operations.
Expenses
The Business
Combination Agreement provides for the following with respect to expenses related to the Proposed Transactions
Sponsor Side Letter
In
connection with signing the Business Combination Agreement, FIAC and FIAC Sponsor entered into a letter agreement, dated September 12, 2023 (the “Sponsor Side Letter”), pursuant to which FIAC Sponsor agreed to forfeit (i) 10% of its SPAC Class B Shares effective as of the consummation of the Continuance at the closing of the Proposed Transactions and (ii) with
FIAC Sponsor’s consent, up to 30% of its SPAC Class B Shares and/or warrants in connection with financing or non-redemption
arrangements, if any, entered into prior to consummation of the Business Combination if any, negotiated by the Effective Date. Pursuant to the Sponsor Side Letter, FIAC Sponsor also agreed to (1) certain transfer restrictions with respect
to SPAC securities, lock-up restrictions (terminating upon the earlier of: (A) 360 days after the Closing Date, (B) a
liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of New PubCo’s stockholders having the right to exchange their equity for cash, securities or other property or (C) subsequent to
the Closing Date, the closing price of the New Pubco Common Shares equaling or exceeding $12.00 per share (as adjusted for
stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period commencing at least 150
days after the Closing) and (2) to vote any SPAC Shares held by it in favor of the Business Combination Agreement, the Arrangement Resolution and the Proposed Transactions, and provided customary representations and warranties and
covenants related to the foregoing.
Company Support & Lock-up Agreement
In connection
with signing the Business Combination Agreement, Devvstream, FIAC and the Core Company Securityholders entered into the Company Support Agreements, dated September 12, 2023, pursuant to which (i) each of the Core Company Securityholders
agreed to vote any Company Shares held by him, her or it in favor of the Business Combination Agreement, the Arrangement Resolution and the Proposed Transactions, and provided customary representations and warranties and covenants related
to the foregoing, and (ii) each of the Core Company Securityholders has agreed to certain transfer restrictions with respect to DevvStream securities prior to the Effective Time and lock-up restrictions with respect to the New PubCo Common
Shares to be received by such Core Company Securityholder under the Business Combination Agreement, which lock-up restrictions are consistent with those agreed to by FIAC Sponsor in the Sponsor Side Letter.
Financial and
Capital Market Advisors
The Company has
engaged (the “Engagement”) J.V.B. Financial Group, LLC, acting through its Cohen & Company Capital Markets division (“CCM”), to act as its (i) its financial advisor and capital markets advisor in connection with a possible acquisition
of DevvStream (“Target”) (the “Sale Transaction”) and (ii) its placement agent in connection with a private placement of debt, equity, equity-linked or convertible securities (the “Securities”) or other capital or debt raising transaction
in connection with the Sale Transaction (the “Offering”, and, together with the Sale Transaction, each a “Transaction” and collectively the “Transactions”).
The
Company will pay CCM the sum of (i) an advisory fee in an amount equal to $2,500,000 simultaneously with the closing of the
Sale Transaction plus (ii) a transaction fee in connection with the Offering of an amount equal to 4.0% of the sum of (A) the
gross proceeds raised from investors and received by Company or Target simultaneously with or before the closing of the Offering and (B) the proceeds released from the Trust Account in connection with the Business Combination with respect
to any stockholder of Client that (x) entered into a non-redemption or other similar agreement or (y) did not redeem the Company’s common stock, in each instance to the extent such stockholder was identified to the Company by CCM
(collectively, the “Offering Fee” and together with the Advisory Fee, the “Transaction Fee”); provided, however, CCM shall receive no fee for any gross proceeds received from, or non-redemptions obtained from any investors holding capital
stock of Target (other than any investor who acquired their capital stock of Target in open market activities). The Transaction Fee shall be payable to CCM simultaneously with the closing of the Transaction. In addition, the Company may,
in its sole discretion, pay to CCM a discretionary fee in an amount up to $500,000 (the “Discretionary Fee”), simultaneously
with the closing of the Sale Transaction, if the Company determines in its discretion and reasonable judgment that the performance of CCM in connection with its leadership role in connection with the Transaction warrants such additional
fee, taking into account, without limitation, (a) timing of the Transaction, (b) quality and delivery of services and advice hereunder, and (c) overall valuation attributable to the Transaction. No Advisory Fee, Offering Fee or Discretionary Fee shall be due to CCM if the Company does not complete the Sale Transaction.
Risks and Uncertainties
The Company’s results of operations and ability to complete an initial Business Combination may be adversely affected by various factors that could cause
economic uncertainty and volatility in the financial markets, many of which are beyond the Company’s control. The Company’s business could be impacted by, among other things, downturns in the financial markets or in economic conditions,
increases in oil prices, inflation, increases in interest rates, supply chain disruptions, declines in consumer confidence and spending and geopolitical instability, such as the military conflict in the Ukraine. The Company cannot at
this time fully predict the likelihood of one or more of the above events, their duration or magnitude or the extent to which they may negatively impact our business and the Company’s ability to complete an initial business combination.
Consideration of Inflation Reduction Act Excise Tax
On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed
into federal law. The IR Act provides for, among other things, a new U.S. federal 1% excise tax on certain repurchases of stock by publicly traded U.S. domestic corporations and certain U.S. domestic subsidiaries of publicly traded
foreign corporations occurring on or after January 1, 2023. The excise tax is imposed on the repurchasing corporation itself, not its shareholders from which shares are repurchased. The amount of the excise tax is generally 1% of the fair
market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the
fair market value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the excise tax. The U.S. Department of the Treasury (the “Treasury”) has been given authority to provide regulations and other
guidance to carry out and prevent the abuse or avoidance of the excise tax.
On December 27, 2022, the Treasury published Notice 2023-2, which provided
clarification on some aspects of the application of the excise tax. The notice generally provides that if a publicly traded U.S. corporation completely liquidates and dissolves, distributions in such complete liquidation and other
distributions by such corporation in the same taxable year in which the final distribution in complete liquidation and dissolution is made are not subject to the excise tax. Although such notice clarifies certain aspects of the excise
tax, the interpretation and operation of aspects of the excise tax (including its application and operation with respect to SPACs) remain unclear and such interim operating rules are subject to change.
Because the application of this excise tax is not entirely clear, any redemption or other repurchase effected by the Company, in connection
with a Business Combination, extension vote or otherwise, may be subject to this excise tax. Because any such excise tax would be payable by the Company and not by the redeeming holders, it could cause a reduction in the value of the
Company’s Class A common stock, cash available with which to effectuate a Business Combination or cash available for distribution in a subsequent liquidation. Whether and to what extent the Company would be subject to the excise tax in
connection with a Business Combination will depend on a number of factors, including (i) the structure of the Business Combination, (ii) the fair market value of the redemptions and repurchases in connection with the Business Combination,
(iii) the nature and amount of any “PIPE” or other equity issuances in connection with the Business Combination (or any other equity issuances within the same taxable year of the Business Combination) and (iv) the content of any subsequent
regulations, clarifications, and other guidance issued by the Treasury. Further, the application of the excise tax in respect of distributions pursuant to a liquidation of a publicly traded U.S. corporation is uncertain and has not been
addressed by the Treasury in regulations, and it is possible that the proceeds held in the Trust Account could be used to pay any excise tax owed by the Company in the event the Company is unable to complete a Business Combination in the
required time and redeem 100% of the remaining Class A common stock in accordance with the Company’s amended and restated certificate of incorporation, in which case the amount that would otherwise be received by the public stockholders in
connection with the Company’s liquidation would be reduced.
Liquidity and Capital Resources, Going Concern
In connection
with the Company’s assessment of going concern considerations in accordance with Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management believes that
the funds which the Company has available following the completion of the IPO may not enable it to sustain operations for a period of at least one-year from the issuance date of these financial statements. Based on the foregoing, management
believes that the Company may not have sufficient working capital to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, the Company will be using these funds
for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to
merge with or acquire, and structuring, negotiating and consummating the Business Combination.
In connection with the Company’s assessment of going concern considerations in accordance with FASB’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures of
Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that the mandatory liquidation, working capital deficiency, and subsequent dissolution, should the Company be unable to complete a Business
Combination, raises substantial doubt about the Company’s ability to continue as a going concern. The Company has until May 1, 2024, which can be extended to November 1, 2024 (with required funding in the Trust Account) to consummate a Business Combination.
It is uncertain that the Company will be able to consummate a Business Combination by this time. If a Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution. No adjustments
have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after May 1, 2024, which can be extended to November 1, 2024 (with required funding in the Trust Account).
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Significant Accounting Policies |
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| Significant Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Significant Accounting Policies |
Note 2 - Significant Accounting Policies
Basis of Presentation
The accompanying consolidated financial statement is presented in conformity with accounting principles generally accepted in the United
States of America (“GAAP”) and pursuant to the rules and regulations of the SEC.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and it may
take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the
independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and
exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised
financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required
to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies
but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or
private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial
statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences
in accounting standards used.
Use of Estimates
The preparation of the consolidated financial statements in conformity with US GAAP requires the Company’s management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting
period. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash
equivalents. As of December 31, 2023 and 2022, the Company had cash of $224,394 and $1,426,006, respectively, and no
cash equivalents. At December 31, 2023, the Company also had $75,773 of restricted cash related to funds withdrawn from
the Trust Account reserved to the payment of taxes.
Cash and Investment Held in Trust Account
As of December 31, 2023, funds held in Trust Account consisted of interest bearing demand deposits and generally have a
readily determinable fair value. Interest on the demand deposit account is included in income from cash and investments held in Trust Account in the accompanying statements of operations.
At December 31, 2022, investments held in the Trust Account are held in a money market fund characterized as Level 1
investments within the fair value hierarchy under ASC 820 (as defined below).
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentration of credit risk consist of a cash account in a financial
institution which, at times may exceed the Federal depository insurance coverage of $250,000. As of December 31, 2023 and 2022, the Company had not experienced losses on this account and management believes the Company was not exposed to
significant risks on such account.
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under the FASB ASC 820, “Fair Value
Measurements and Disclosures,” approximates the carrying amounts represented in the consolidated balance sheet, primarily due to its short-term nature.
The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at
each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have
received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In
connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal
assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the
assets and liabilities:
Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the
ability to access. Valuation adjustments and block discounts are not being applied. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a
significant degree of judgment.
Level 2—Valuations based on (i) quoted prices in active markets for similar assets and liabilities, (ii) quoted prices in markets that
are not active for identical or similar assets, (iii) inputs other than quoted prices for the assets or liabilities, or (iv) inputs that are derived principally from or corroborated by market through correlation or other means.
Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
Net Income Per Common Stock
The Company has two classes of common stock, which are referred to as Class A common stock and Class B common stock. Earnings and losses are shared pro rata between the two classes of stockholders. Private and
public warrants to purchase 22,700,000 Class A common stock at $11.50 per share were issued on November 1, 2021. No warrants were
exercised during the year ended December 31, 2023 and 2022. The calculation of diluted income per common stock does not consider the effect of the warrants issued in connection with (i) the Initial Public Offering, (ii) the exercise of the
over-allotment and (iii) the Private Placement since the exercise of the warrants is contingent upon the occurrence of future events. As a result, diluted net income per common stock is the same as basic net income per common stock for the periods. Accretion associated with the redeemable Class A common stock is excluded from
income per common stock as the redemption value approximates fair value.
Derivative Financial Instruments
The Company evaluates its financial
instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. Derivative instruments are initially recorded at fair value on
the grant date and re-valued at each reporting date, with changes in the fair value reported in the consolidated statement of operations. Derivative assets and liabilities are classified in the consolidated balance sheet as current or
non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the consolidated balance sheet date.
Warrant Liability
The Company accounted for the 22,700,000
warrants issued in connection with the IPO and Private Placement in accordance with the guidance contained in FASB ASC 815 “Derivatives and Hedging” whereby under that provision the warrants do not meet the criteria for equity treatment
and must be recorded as a liability. Accordingly, the Company classified the warrant instrument as a liability at fair value and will adjust the instrument to fair value at each reporting period. This liability will be re-measured at each
balance sheet date until the warrants are exercised or expire, and any change in fair value will be recognized in the Company’s consolidated statement of operations. The fair value of privately-held warrants was estimated using an
internal valuation model. Our valuation model utilized inputs such as assumed share prices, volatility, discount factors and other assumptions and may not be reflective of the price at which they can be settled. Such warrant
classification is also subject to re-evaluation at each reporting period.
Income Taxes
The Company accounts for income taxes under ASC 740, “Income Taxes.” ASC 740, Income Taxes, requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized. As of December 31, 2023 and 2022, the Company’s deferred tax asset had a full valuation allowance recorded against it. Our effective tax rate was 97.9% and 5.3% for the year ended December 31, 2023 and 2022, respectively. The effective tax rate differs from the statutory tax rate of 21% for the year ended December 31, 2023 and 2022, primarily due to changes in fair value in warrant liability, warrant transaction costs, business combination expenses and the valuation allowance on the deferred tax assets. ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a
recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be
more-likely-than-not to be sustained upon examination by taxing authorities. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no
amounts accrued for interest and penalties as of December 31, 2023. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
The Company has identified the United States as its only “major” tax jurisdiction.
The Company is subject to income taxation by major taxing authorities since inception. These examinations may include questioning the
timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with federal and state tax laws. The Company’s management does not expect that the total amount of unrecognized tax benefits will
materially change over the next twelve months.
Common Stock Subject to Possible Redemption
All of the common stock sold as part of the Units in the IPO contain a redemption feature which allows for the redemption of such
Public Shares in connection with the Company’s liquidation, if there is a stockholder vote or tender offer in connection with the Business Combination and in connection with certain amendments to the Company’s amended and restated
certificate of incorporation. In accordance with SEC and its staff’s guidance on redeemable equity instruments, which has been codified in ASC 480-10-S99, redemption provisions not solely within the control of the Company require common
stock subject to redemption to be classified outside of permanent equity. Therefore, all shares of Class A common stock have been classified outside of permanent equity.
The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock
to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid in capital and accumulated deficit.
As of December 31, 2023 and 2022, the Class A common stock subject to possible redemption reflected on the consolidated balance sheet are reconciled in the
following table:
At December 31,
2023, an excess of $75,773 was withdrawn from the interest earned in the Trust Account related to the timing of payments of taxes.
As of the date of this filing, the Company has repaid the excess withdrawals from the Trust Account.
Recent Accounting Pronouncements
In August 2020, FASB issued Accounting Standards Update (“ASU”) 2020-06, Debt – Debt with
Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify
accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception
guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s
own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. The Company adopted ASU 2020-06 on January 1, 2022 and the standard was
applied on a full retrospective basis. There was no material impact on the Company’s financial position, results of operations or cash flows.
In December
2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of
income taxes paid, among other disclosure requirements. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company’s management does not believe the adoption of ASU 2023-09 will
have a material impact on its financial statements and disclosures.
The Company’s management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently
adopted, would have a material effect on the Company’s consolidated financial statements.
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Initial Public Offering |
12 Months Ended | ||||||||||||||||||||||||
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Dec. 31, 2023 | |||||||||||||||||||||||||
| Initial Public Offering [Abstract] | |||||||||||||||||||||||||
| Initial Public Offering |
Note 3 - Initial Public Offering
On November 1, 2021, the Company sold 23,000,000
Units at a purchase price of $10.00 per Unit which included the exercise of the underwriters’ option to purchase an
additional 3,000,000 Units at the initial public offering price to cover over-allotments. Each Unit had an offering price of
$10.00 and consists of one
share of Class A common stock of the Company, par value $0.0001 per share, and of one warrant of the Company. Each full Warrant entitles the holder thereof to purchase one share of Class A Common Stock at a price of $11.50 per share.
Following the closing of the IPO on November 1, 2021, $234,600,000 ($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 deposited into the Trust Account. The net proceeds deposited into the Trust Account will be invested in United States “government securities” within the meaning of Section
2(a)(16) of the Investment Company Act with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury
obligations.
Public Warrants
Each whole warrant entitles the registered holder to purchase one whole share of the Class A common stock at a price of $11.50 per
share, subject to adjustment, at any time commencing on the later of twelve months from the closing of the IPO and 30 days after the completion of the initial Business Combination. The warrants will expire five years after the completion of the initial Business Combination, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation.
The Company has agreed that as soon as practicable, but in no event later than business days after the closing of the initial Business Combination, the Company will use commercially reasonable efforts to file with the SEC a registration statement for
the registration, under the Securities Act, of the shares of Class A common stock issuable upon exercise of the warrants, and the Company will use commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of the initial Business Combination, and to maintain the effectiveness of such registration statement and
a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement; provided that if the Company’s Class A common stock is at the time of any exercise
of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at the Company’s option, require holders of public
warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, will not be required to file or maintain in effect a registration
statement, but will use commercially reasonably efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. If a registration statement covering the shares of Class A common
stock issuable upon exercise of the warrants is not effective by the 60th day after the closing of the initial Business Combination, warrant holders may, until such time as there is an effective registration statement and during any
period when the Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption, but will use commercially
reasonably efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. In such event, each holder would pay the exercise price by surrendering the warrants for that number of
shares of Class A common stock equal to the lesser of (A) the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the excess of the “fair market value”
(defined below) less the exercise price of the warrants by (y) the fair market value and (B) the product of 0.361 and the
number of whole warrants being exercised by such holder. The “fair market value” as used in this paragraph shall mean the volume weighted average price of the Class A common stock for the 10 trading days ending on the trading day prior to the date on which the notice of exercise is received by the warrant agent.
Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00.
Once the warrants become exercisable, the Company may redeem the outstanding warrants (except as described herein with respect to the
private placement warrants):
The Company will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance
of the shares of Class A common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period. If and when the
warrants become redeemable by the Company, the Company may exercise the Company’s redemption right even if the Company are unable to register or qualify the underlying securities for sale under all applicable state securities laws.
Redemption of
warrants when the price per share of Class A common stock equals or exceeds $10.00.
Once the warrants become exercisable, we may redeem the outstanding warrants:
|
Private Placement |
12 Months Ended |
|---|---|
Dec. 31, 2023 | |
| Private Placement [Abstract] | |
| Private Placement |
Note 4 - Private Placement
On November 1, 2021, simultaneously with the closing of the IPO, the Company completed the private sale of 11,200,000 warrants (the “Private Placement Warrants”) at a purchase price of $1.00 per Private Placement Warrant to the Sponsor, generating gross proceeds to the Company of $11,200,000.
A portion of the proceeds from the Private Placement Warrants has been added to the proceeds from the IPO to be held in the Trust Account.
If the Company does not complete a Business Combination by the Termination Date, the proceeds of the sale of the Private Placement Warrants will be used to fund the redemption of the public shares (subject to the requirements of applicable
law), and the Private Placement Warrants will expire worthless.
The Private Placement Warrants (including the Class A common stock issuable upon exercise of the Private Placement Warrants) will not be
transferable, assignable or salable until 30 days after the completion of the initial Business Combination and they will not be
redeemable by the Company so long as they are held by the Sponsor or its permitted transferees. The Sponsor, or its permitted transferees, has the option to exercise the Private Placement Warrants on a cashless basis.
The Sponsor, officers and directors have entered into a letter agreement with the Company, pursuant to which they have agreed (i) to waive
their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of the initial Business Combination and a stockholder vote to approve an amendment to the Company’s amended and
restated certificate of incorporation (A) that would modify the substance or timing of the Company’s obligation to provide holders of shares of Class A common stock the right to have their shares redeemed in connection with the initial
Business Combination or to redeem 100% of the Company’s public shares if the Company does not complete the initial Business
Combination until May 1, 2024, which can be extended to November 1, 2024 (with required funding in the Trust Account) or (B) with respect
to any other provision relating to the rights of holders of the Company’s Class A commons stock and (ii) to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if the Company
fails to consummate an initial Business Combination until May 1, 2024, which can be extended to November 1, 2024 (with required funding in
the Trust Account) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if the Company fails to complete the initial Business Combination within the prescribed time
frame). Further, the Company has agreed not to enter into a definitive agreement regarding an initial Business Combination without the prior consent of the Sponsor.
|
Related Party Transactions |
12 Months Ended |
|---|---|
Dec. 31, 2023 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions |
Note 5 - Related Party Transactions
Founder Shares
The Sponsor paid $25,000
to the Company in consideration for 5,750,000 shares of Class B common stock.
The founder shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 8.
Pursuant to the Sponsor Side Letter, the Sponsor agreed to (1) certain transfer restrictions with respect to the Company's
securities, lock-up restrictions (terminating upon the earlier of: (A) 360 days after the Closing Date, (B) a liquidation,
merger, capital stock exchange, reorganization or other similar transaction that results in all of New PubCo's stockholders having the right to exchange their equity for cash, securities or other property or (C) subsequent to the
Closing Date, the closing price of the New Pubco Common Shares equaling or exceeding $12.00 per share (as adjusted for
stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period commencing at least 150
days after the Closing) and (2) to vote any Company shares held by it in favor of the Business Combination Agreement, the Arrangement Resolution and the Proposed Transactions, and provided customary representations and warranties and
covenants related to the foregoing.
Related Party Loans
In order to finance transaction costs in connection with an intended initial 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 (the “Working Capital Loans”). If the Company completes an initial Business Combination, the Company would
repay such loaned amounts out of the proceeds of the Trust Account released to the Company. Otherwise, such loans would be repaid only out of funds held outside the Trust Account. In the event that the initial Business Combination does not
close, the Company may use a portion of the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from the Trust Account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the Private Placement Warrants, including as to exercise price, exercisability and
exercise period. On May 9, 2023, the Company issued an unsecured promissory note in the total principal amount of up to $1,500,000
(the “Promissory Note”) to the Sponsor. At December 31, 2023 and 2022, $1,500,000 and $0 was outstanding and reported on the consolidated balance sheets as Promissory note - related party.
On December 1, 2023, the Company issued an unsecured promissory note in the total principal amount of up to $1,500,000 (the “Promissory Note”) to the Sponsor. The Promissory Note does not bear interest and matures upon closing of the Company’s initial Business Combination. In the event that the Company does not consummate a Business Combination, the Promissory Note will be repaid only from amounts remaining outside of the Trust Account, if any. As of December 31, 2023, $375,000 was outstanding and reported on the consolidated balance sheets as Promissory note - related party. Administrative Fees
The Company agreed to pay the Sponsor a total of $10,000 per month for office space, utilities and secretarial and administrative support provided to the Company. Upon completion of the initial Business Combination or the Company’s liquidation, the
Company will cease paying these monthly fees. For the year ended December 31, 2023 and 2022, the Company incurred $120,000
in administrative support fees. No amounts have been paid for the administrative fee. At December 31, 2023 and 2022, $240,000
and $120,000 is reported on the consolidated balance sheets under due to related party for this fee, respectively.
|
Commitments and Contingencies |
12 Months Ended |
|---|---|
Dec. 31, 2023 | |
| Commitments and Contingencies [Abstract] | |
| Commitments and Contingencies |
Note 6 - Commitments and Contingencies
Registration and Stockholder Rights
The holders of the founder shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital
Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the founder shares) will be
entitled to registration rights pursuant to a registration rights and stockholder agreement to be signed prior to the consummation of the IPO, requiring the Company to register such securities for resale (in the case of the
founder shares, only after conversion to the Class A common stock). The holders of the majority of these securities are entitled to make up to three demands, excluding short form demands, that the Company registers such securities. In addition, the holders have certain “piggy-back” registration rights with respect
to registration statements filed subsequent to the completion of the initial Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act.
Underwriter Agreement
The underwriters were entitled to a deferred underwriting fee of approximately $0.376 per
unit sold in the IPO, or $8,650,000 in the aggregate (including the fee related to the underwriters’ exercise of
the over-allotment option) upon the completion of the Company’s initial Business Combination. In the third quarter 2023, the underwriters waived any right to receive the deferred underwriting fee and will therefore receive no
additional underwriting fee in connection with the Closing. As a result, the Company recognized $309,534 of income
and $8,340,466 was recorded to accumulated deficit in relation to the reduction of the deferred underwriting fee.
As of December 31, 2023 and 2022, the deferred underwriting fee is $0 and $8,650,000, respectively.
The Company complies with ASC 405 “Liabilities” and derecognized the deferred underwriting fee liability upon being released of the obligation by the underwriters. To account for the waiver of the
deferred underwriting fee, the Company reduced the deferred underwriting fee liability to $0 and reversed the
previously recorded cost of issuing the instruments in the IPO, which included recognizing a contra-expense of $309,534,
which is the amount previously allocated to liability classified warrants and expensed upon the IPO, and reduced the accumulated deficit and increased income available to Class B common stock by $8,650,000, which was previously allocated to the Class A common stock subject to redemption and accretion recognized at the IPO
date.
Marketing Fee Agreement
The Company engaged advisors to assist the Company in validating existing acquisition strategies and providing recommendations or potential amendments and refinements to said strategy. The fee structure is set as a minimum of $150,000 due upon a Business Combination for advisory services. If the advisors provide lead information of a potential target company in a Business Combination, the Company will pay the advisors between $2,000,000 and $6,000,000 (“Advisory Fee”) upon successful close of the Business Combination. The advisors did not provide lead information related to the proposed Business Combination. As such, if the proposed Business Combination is consummated, the advisors are not due the Advisory Fee. Excise Tax
In connection with the extension meetings to amend the Company’s amended and restated certificate of incorporation, holders of 21,282,422 shares of Class A common stock properly exercised their right to redeem their shares of Class A common stock for an aggregate redemption amount of $223,500,610. As such, the Company has recorded a 1% excise tax liability in the amount of $2,235,006 on the consolidated balance sheets as of December 31, 2023. The liability does not impact the consolidated statements of operations and is offset against additional paid-in capital or accumulated deficit if additional paid-in capital is not available. This excise tax liability can be offset by future share issuances within the same fiscal year which will be evaluated and
adjusted in the period in which the issuances occur.
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Recurring Fair Value Measurements |
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Dec. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Recurring Fair Value Measurements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Recurring Fair Value Measurements |
Note 7 - Recurring Fair Value Measurements
At December 31, 2023, investments held in the Trust Account are held in an interest bearing demand deposit account and at December 31, 2022, substantially all of
the Company’s trust assets on the consolidated balance sheet consist of U. S. Money Market funds which are classified as cash equivalents. Fair values of these investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in
active markets for identical assets.
Under the guidance in ASC 815-40 the warrants do not meet the criteria for equity classification. As such, these financial instruments must be recorded on the consolidated balance sheet at fair value. This valuation is subject to re-measurement at each balance sheet date. With each re-measurement, these financial instruments valuations will be adjusted to fair value, with the change in fair value recognized in the Company’s consolidated statement of operations. The Company’s warrant liability for the Private Placement Warrants is based on valuation models utilizing inputs from observable and unobservable markets. The inputs used to determine the fair value of the Private Warrant liability, is classified within Level 3 of the fair value hierarchy. The Company’s Public Warrants are trading on the Nasdaq Stock Market LLC (“NASDAQ”) and the Company’s warrant liability was based on unadjusted quoted prices in an
active market (NASDAQ) for identical assets or liabilities that the Company has the ability to access. The fair value of the Public Warrant liability is classified within Level 1 of the fair value hierarchy.
The Company’s Promissory Note contains an embedded option whereby up to $1,500,000 of the Promissory Note may be converted into the Company’s warrants. The embedded Working Capital Loan conversion option is accounted for as a liability in accordance with ACS
815-40 on the balance sheet and is measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value in the consolidated statement of operations. Valuation of the Working Capital Loan
conversion option was derived from the valuation of the underlying Private Placement Warrants and is classified as a level 3 valuation.
The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of December 31, 2023
and 2022, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.
Measurement
The Private Warrants were valued using a binomial lattice model, which is considered to be a Level 3 fair value measurement.
The key inputs into the binomial lattice model were as follows at December 31, 2023 and 2022:
The following table
provides a reconciliation of changes in fair value of the beginning and ending balances for the Company’s warrants classified as Level 3 for the period ended December 31, 2023 and December 31, 2022:
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Stockholder's Deficit |
12 Months Ended |
|---|---|
Dec. 31, 2023 | |
| Stockholders' Deficit [Abstract] | |
| Stockholders' Deficit |
Note 8 - Stockholders’ Deficit
Preferred Stock
The Company is authorized to issue 1,000,000
shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as
may be determined from time to time by the Company’s board of directors. At December 31, 2023 and 2022, there were no shares
of preferred stock issued or outstanding.
Class A Common Stock
On December 21, 2023, the Sponsor converted 5,000,000 shares of Class B common stock into
shares of Class A common stock. Notwithstanding the conversions, the Sponsor will not be entitled to receive any monies held in the Trust Account as a result of its ownership of shares of Class A common stock issued upon conversion of the
Class B common stock.
The Company is authorized to issue 500,000,000
shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. As of December 31, 2023 and 2022, there were 5,000,000 and no shares of Class A common stock issued or
outstanding, excluding 1,717,578 and 23,000,000
shares subject to possible redemption, respectively.
Class B Common Stock
The Company is authorized to issue 50,000,000
shares of Class B common stock with a par value of $0.0001 per share. Holders of the Company’s Class B common stock are entitled to
one vote for each common stock. At December 31, 2023 and 2022, there were 750,000 and 5,750,000 shares of Class B common
stock issued and outstanding, respectively.
Other than with regard to the election of directors prior to the consummation of a Business Combination, holders of Class A common stock and
Class B common stock will vote together as a single class on all matters submitted to a vote of stockholders, except as required by law.
The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination,
or earlier at the option of the holder thereof, on a one-for-one basis (subject to adjustment for stock splits, stock dividends,
reorganizations, recapitalizations and the like), and subject to further adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in
the IPO and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares
of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in
the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon
completion of the IPO plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (excluding any shares or equity-linked securities issued, or to be issued, to any
seller in a Business Combination and any private placement-equivalent warrants issued to the Sponsor or its affiliates upon conversion of loans made to the Company).
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Income Tax |
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Dec. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax |
Note 9- Income Tax
The Company’s net deferred tax assets at December 31, 2023 and 2022 are as follows:
The income tax provision for the year ended December 31, 2023 and 2022 consists of the following:
As of December 31, 2023 and 2022, the Company had $0
of U.S. federal net operating loss carryovers, which do not expire, and no state net operating loss carryovers available to offset future taxable income.
In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax
assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become
deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management
believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2023 and 2022, the change in the valuation
allowance was $547,441 and $329,066,
respectively.
A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2023 and 2022 is as follows:
The Company files US federal and New York City and State tax returns and is subject to examination by various taxing authorities.
The Company’s effective tax rates for the period presented differ from the expected (statutory) rates due to the recording of full valuation allowances on deferred
tax assets, changes in fair value of warrants and transaction costs associated with warrants.
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Subsequent Events |
12 Months Ended |
|---|---|
Dec. 31, 2023 | |
| Subsequent Events [Abstract] | |
| Subsequent Events |
Note 10 - Subsequent Events
Management has evaluated subsequent events to determine if events or transactions occurring through the date the consolidated financial
statements were issued, require potential adjustment to or disclosure in the consolidated financial statements and did not identify any subsequent events that would have required adjustment or disclosure in the consolidated financial
statements.
On January 8,
2024, the Sponsor deposited $103,055 in the Trust Account extending the Termination Date to April 1, 2024 and in March 2024, the
Sponsor deposited $34,352 in the Trust Account extending the Termination Date to May 1, 2024, which can be extended to November
1, 2024 (with required funding in the Trust Account).
On March 27, 2024, the Company transferred $75,773 to the
Trust Account related to related to excess funds withdrawn and the timing of the payment of taxes.
|
Insider Trading Arrangements |
3 Months Ended |
|---|---|
Dec. 31, 2023 | |
| Insider Trading Arrangements [Line Items] | |
| Rule 10b5-1 Arrangement Adopted | false |
| Non-Rule 10b5-1 Arrangement Adopted | false |
| Rule 10b5-1 Arrangement Terminated | false |
| Non-Rule 10b5-1 Arrangement Terminated | false |
Significant Accounting Policies (Policies) |
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| Significant Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Basis of Presentation |
Basis of Presentation
The accompanying consolidated financial statement is presented in conformity with accounting principles generally accepted in the United
States of America (“GAAP”) and pursuant to the rules and regulations of the SEC.
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| Use of Estimates |
Use of Estimates
The preparation of the consolidated financial statements in conformity with US GAAP requires the Company’s management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting
period. Actual results could differ from those estimates.
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| Cash and Cash Equivalents |
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash
equivalents. As of December 31, 2023 and 2022, the Company had cash of $224,394 and $1,426,006, respectively, and no
cash equivalents. At December 31, 2023, the Company also had $75,773 of restricted cash related to funds withdrawn from
the Trust Account reserved to the payment of taxes.
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| Investment Held in Trust Account |
Cash and Investment Held in Trust Account
As of December 31, 2023, funds held in Trust Account consisted of interest bearing demand deposits and generally have a
readily determinable fair value. Interest on the demand deposit account is included in income from cash and investments held in Trust Account in the accompanying statements of operations.
At December 31, 2022, investments held in the Trust Account are held in a money market fund characterized as Level 1
investments within the fair value hierarchy under ASC 820 (as defined below).
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| Concentration of Credit Risk |
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentration of credit risk consist of a cash account in a financial
institution which, at times may exceed the Federal depository insurance coverage of $250,000. As of December 31, 2023 and 2022, the Company had not experienced losses on this account and management believes the Company was not exposed to
significant risks on such account.
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| Fair Value of Financial Instruments |
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under the FASB ASC 820, “Fair Value
Measurements and Disclosures,” approximates the carrying amounts represented in the consolidated balance sheet, primarily due to its short-term nature.
The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at
each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have
received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In
connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal
assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the
assets and liabilities:
Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the
ability to access. Valuation adjustments and block discounts are not being applied. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a
significant degree of judgment.
Level 2—Valuations based on (i) quoted prices in active markets for similar assets and liabilities, (ii) quoted prices in markets that
are not active for identical or similar assets, (iii) inputs other than quoted prices for the assets or liabilities, or (iv) inputs that are derived principally from or corroborated by market through correlation or other means.
Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
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| Net Income Per Common Stock |
Net Income Per Common Stock
The Company has two classes of common stock, which are referred to as Class A common stock and Class B common stock. Earnings and losses are shared pro rata between the two classes of stockholders. Private and
public warrants to purchase 22,700,000 Class A common stock at $11.50 per share were issued on November 1, 2021. No warrants were
exercised during the year ended December 31, 2023 and 2022. The calculation of diluted income per common stock does not consider the effect of the warrants issued in connection with (i) the Initial Public Offering, (ii) the exercise of the
over-allotment and (iii) the Private Placement since the exercise of the warrants is contingent upon the occurrence of future events. As a result, diluted net income per common stock is the same as basic net income per common stock for the periods. Accretion associated with the redeemable Class A common stock is excluded from
income per common stock as the redemption value approximates fair value.
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| Derivative Financial Instruments |
Derivative Financial Instruments
The Company evaluates its financial
instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. Derivative instruments are initially recorded at fair value on
the grant date and re-valued at each reporting date, with changes in the fair value reported in the consolidated statement of operations. Derivative assets and liabilities are classified in the consolidated balance sheet as current or
non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the consolidated balance sheet date.
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| Warrant Liability |
Warrant Liability
The Company accounted for the 22,700,000
warrants issued in connection with the IPO and Private Placement in accordance with the guidance contained in FASB ASC 815 “Derivatives and Hedging” whereby under that provision the warrants do not meet the criteria for equity treatment
and must be recorded as a liability. Accordingly, the Company classified the warrant instrument as a liability at fair value and will adjust the instrument to fair value at each reporting period. This liability will be re-measured at each
balance sheet date until the warrants are exercised or expire, and any change in fair value will be recognized in the Company’s consolidated statement of operations. The fair value of privately-held warrants was estimated using an
internal valuation model. Our valuation model utilized inputs such as assumed share prices, volatility, discount factors and other assumptions and may not be reflective of the price at which they can be settled. Such warrant
classification is also subject to re-evaluation at each reporting period.
|
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| Income Taxes |
Income Taxes
The Company accounts for income taxes under ASC 740, “Income Taxes.” ASC 740, Income Taxes, requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized. As of December 31, 2023 and 2022, the Company’s deferred tax asset had a full valuation allowance recorded against it. Our effective tax rate was 97.9% and 5.3% for the year ended December 31, 2023 and 2022, respectively. The effective tax rate differs from the statutory tax rate of 21% for the year ended December 31, 2023 and 2022, primarily due to changes in fair value in warrant liability, warrant transaction costs, business combination expenses and the valuation allowance on the deferred tax assets. ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a
recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be
more-likely-than-not to be sustained upon examination by taxing authorities. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no
amounts accrued for interest and penalties as of December 31, 2023. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
The Company has identified the United States as its only “major” tax jurisdiction.
The Company is subject to income taxation by major taxing authorities since inception. These examinations may include questioning the
timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with federal and state tax laws. The Company’s management does not expect that the total amount of unrecognized tax benefits will
materially change over the next twelve months.
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| Common Stock Subject to Possible Redemption |
Common Stock Subject to Possible Redemption
All of the common stock sold as part of the Units in the IPO contain a redemption feature which allows for the redemption of such
Public Shares in connection with the Company’s liquidation, if there is a stockholder vote or tender offer in connection with the Business Combination and in connection with certain amendments to the Company’s amended and restated
certificate of incorporation. In accordance with SEC and its staff’s guidance on redeemable equity instruments, which has been codified in ASC 480-10-S99, redemption provisions not solely within the control of the Company require common
stock subject to redemption to be classified outside of permanent equity. Therefore, all shares of Class A common stock have been classified outside of permanent equity.
The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock
to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid in capital and accumulated deficit.
As of December 31, 2023 and 2022, the Class A common stock subject to possible redemption reflected on the consolidated balance sheet are reconciled in the
following table:
At December 31,
2023, an excess of $75,773 was withdrawn from the interest earned in the Trust Account related to the timing of payments of taxes.
As of the date of this filing, the Company has repaid the excess withdrawals from the Trust Account.
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| Recent Accounting Pronouncements |
Recent Accounting Pronouncements
In August 2020, FASB issued Accounting Standards Update (“ASU”) 2020-06, Debt – Debt with
Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify
accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception
guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s
own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. The Company adopted ASU 2020-06 on January 1, 2022 and the standard was
applied on a full retrospective basis. There was no material impact on the Company’s financial position, results of operations or cash flows.
In December
2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of
income taxes paid, among other disclosure requirements. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company’s management does not believe the adoption of ASU 2023-09 will
have a material impact on its financial statements and disclosures.
The Company’s management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently
adopted, would have a material effect on the Company’s consolidated financial statements.
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Significant Accounting Policies (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Significant Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Basic and Diluted Net Income Per Common Share | As a result, diluted net income per common stock is the same as basic net income per common stock for the periods. Accretion associated with the redeemable Class A common stock is excluded from
income per common stock as the redemption value approximates fair value.
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| Class A Common Stock Subject to Possible Redemption |
As of December 31, 2023 and 2022, the Class A common stock subject to possible redemption reflected on the consolidated balance sheet are reconciled in the
following table:
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Recurring Fair Value Measurements (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Recurring Fair Value Measurements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Assets and Liabilities Measured at Fair Value on Recurring Basis |
The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of December 31, 2023
and 2022, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.
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| Key Inputs into Binomial Lattice Model |
The key inputs into the binomial lattice model were as follows at December 31, 2023 and 2022:
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| Changes in Fair Value of Warrants |
The following table
provides a reconciliation of changes in fair value of the beginning and ending balances for the Company’s warrants classified as Level 3 for the period ended December 31, 2023 and December 31, 2022:
|
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Income Tax (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Deferred Tax Assets |
The Company’s net deferred tax assets at December 31, 2023 and 2022 are as follows:
|
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| Income Tax Provision |
The income tax provision for the year ended December 31, 2023 and 2022 consists of the following:
|
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| Reconciliation of Federal Income Tax Rate |
A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2023 and 2022 is as follows:
|
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Organization and Business Operations, Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard (Details) |
Dec. 21, 2023
shares
|
Dec. 31, 2023
USD ($)
|
Oct. 16, 2023
Shareholder
|
Dec. 31, 2022
USD ($)
|
|---|---|---|---|---|
| Organization and Business Operations [Abstract] | ||||
| Minimum number of public holders required for continued listing | Shareholder | 400 | |||
| Converted Shares [Abstract] | ||||
| Cash and Investment held in Trust Account | $ 62,418,210 | $ 237,038,010 | ||
| Class B Common Stock [Member] | Sponsor [Member] | ||||
| Converted Shares [Abstract] | ||||
| Conversion of Class B common stock to Class A common stock (in shares) | shares | 5,000,000 | |||
| Class A Common Stock [Member] | ||||
| Converted Shares [Abstract] | ||||
| Cash and Investment held in Trust Account | $ 0 |
Organization and Business Operations, Financial and Capital Market Advisors (Details) |
12 Months Ended |
|---|---|
|
Dec. 31, 2023
USD ($)
| |
| Financial and Capital Market Advisors [Abstract] | |
| Advisory fee payable | $ 2,500,000 |
| Transaction fee | 4.00% |
| Discretionary fee payable | $ 500,000 |
| Advisory, offering and discretionary fee due | $ 0 |
Significant Accounting Policies, Cash and Cash Equivalents (Details) - USD ($) |
Dec. 31, 2023 |
Dec. 31, 2022 |
|---|---|---|
| Cash and Cash Equivalents [Abstract] | ||
| Cash | $ 224,394 | $ 1,426,006 |
| Cash and cash equivalents | 0 | 0 |
| Amount included in cash balance which is reserved for payment of taxes | $ 75,773 | $ 0 |
Significant Accounting Policies, Warrant Liability (Details) |
Nov. 01, 2021
shares
|
|---|---|
| Redeemable Warrants [Member] | |
| Warrant Liability [Abstract] | |
| Warrants issued (in shares) | 22,700,000 |
Significant Accounting Policies, Income Taxes (Details) - USD ($) |
12 Months Ended | |
|---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Income Taxes [Abstract] | ||
| Effective income tax rate | 97.90% | 5.30% |
| Statutory tax rate | 21.00% | 21.00% |
| Unrecognized tax benefits | $ 0 | |
| Accrued interest and penalties | $ 0 | |
Significant Accounting Policies, Common Stock Subject to Possible Redemption (Details) - USD ($) |
12 Months Ended | |
|---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Common Stock Subject to Possible Redemption [Abstract] | ||
| Class A common stock subject to possible redemption | $ 237,020,680 | |
| Extension funding of Trust Account | 1,300,000 | |
| Class A common stock subject to possible redemption | 18,853,961 | $ 237,020,680 |
| Amount included in cash balance which is reserved for payment of taxes | 75,773 | 0 |
| Class A Common Stock [Member] | ||
| Common Stock Subject to Possible Redemption [Abstract] | ||
| Class A common stock subject to possible redemption | 237,020,680 | 234,600,000 |
| Redemptions | (223,500,610) | 0 |
| Extension funding of Trust Account | 1,300,000 | 0 |
| Remeasurement adjustment of carrying value to redemption value | 4,033,891 | 2,420,680 |
| Class A common stock subject to possible redemption | $ 18,853,961 | $ 237,020,680 |
Private Placement (Details) - USD ($) |
12 Months Ended | |
|---|---|---|
Nov. 01, 2021 |
Dec. 31, 2023 |
|
| Private Placement Warrants [Abstract] | ||
| Number of trading days | 10 days | |
| Private Placement Warrants [Member] | ||
| Private Placement Warrants [Abstract] | ||
| Warrants issued (in shares) | 11,200,000 | |
| Share price (in dollars per share) | $ 1 | |
| Gross proceeds from private placement | $ 11,200,000 | |
| Number of trading days | 30 days | |
| Percentage of redemption of public shares | 100.00% | |
| Private Placement [Member] | Private Placement Warrants [Member] | ||
| Private Placement Warrants [Abstract] | ||
| Warrants issued (in shares) | 11,200,000 | |
| Share price (in dollars per share) | $ 1 | |
| Gross proceeds from private placement | $ 11,200,000 |
Related Party Transactions, Related Party Loans (Details) - USD ($) |
12 Months Ended | |||
|---|---|---|---|---|
Dec. 31, 2023 |
Dec. 01, 2023 |
May 09, 2023 |
Dec. 31, 2022 |
|
| Related Party Loans [Abstract] | ||||
| Promissory note - related party | $ 1,875,000 | $ 0 | ||
| Sponsor, Affiliate of Sponsor, or Certain Company Officers and Directors [Member] | Working Capital Loans [Member] | ||||
| Related Party Loans [Abstract] | ||||
| Maximum amount of convertible loans | $ 1,500,000 | |||
| Conversion price (in dollars per share) | $ 1 | |||
| Promissory Note [Member] | ||||
| Related Party Loans [Abstract] | ||||
| Promissory note - related party | $ 1,500,000 | $ 0 | ||
| Promissory Note [Member] | Maximum [Member] | ||||
| Related Party Loans [Abstract] | ||||
| Principal amount | 1,500,000 | $ 1,500,000 | $ 1,500,000 | |
| Second Promissory Note [Member] | ||||
| Related Party Loans [Abstract] | ||||
| Promissory note - related party | $ 375,000 |
Related Party Transactions, Administrative Support Agreement (Details) - USD ($) |
12 Months Ended | |
|---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Related Party Transactions [Abstract] | ||
| Administrative support fees | $ 5,219,930 | $ 1,784,832 |
| Due to Sponsor | 240,000 | 120,000 |
| Administrative Support Agreement [Member] | Related Party [Member] | ||
| Related Party Transactions [Abstract] | ||
| Monthly related party fee | 10,000 | |
| Administrative support fees | 120,000 | 120,000 |
| Due to Sponsor | $ 240,000 | $ 120,000 |
Recurring Fair Value Measurements, Key Inputs for Private Placement Warrants and Public Warrants at Initial Measurement (Details) |
Dec. 31, 2023
$ / shares
|
Dec. 31, 2022
$ / shares
|
|---|---|---|
| Key inputs into Monte Carlo Simulation Model [Abstract] | ||
| Term | 5 years | |
| Warrant [Member] | ||
| Key inputs into Monte Carlo Simulation Model [Abstract] | ||
| Term | 3 months | 3 months |
| Warrant [Member] | Risk-Free Interest Rate [Member] | ||
| Key inputs into Monte Carlo Simulation Model [Abstract] | ||
| Measurement input | 0.0381 | 0.0395 |
| Warrant [Member] | Common Stock Price [Member] | ||
| Key inputs into Monte Carlo Simulation Model [Abstract] | ||
| Measurement input | 10.89 | 10.18 |
| Warrant [Member] | Dividend Yield [Member] | ||
| Key inputs into Monte Carlo Simulation Model [Abstract] | ||
| Measurement input | 0 | 0 |
Recurring Fair Value Measurements, Changes in Fair Value of Warrant Liabilities (Details) - Level 3 [Member] - USD ($) |
12 Months Ended | |
|---|---|---|
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Changes in Fair Value of Warrant Liabilities [Roll Forward] | ||
| Fair value, beginning of period | $ 560,000 | $ 5,824,000 |
| Change in fair value | $ (336,000) | $ (5,264,000) |
| Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Change in fair value of warrant liabilities | Change in fair value of warrant liabilities |
| Fair value, end of period | $ 224,000 | $ 560,000 |
Subsequent Events (Details) - USD ($) |
1 Months Ended | ||||||
|---|---|---|---|---|---|---|---|
Jan. 08, 2024 |
Dec. 01, 2023 |
Oct. 31, 2023 |
Mar. 31, 2024 |
Mar. 27, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Subsequent Events [Abstract] | |||||||
| Additional cash deposited in Trust Account | $ 162,500 | $ 162,500 | |||||
| Funds withdrawn from trust account reserved to payment of taxes | $ 75,773 | $ 0 | |||||
| Subsequent Event [Member] | |||||||
| Subsequent Events [Abstract] | |||||||
| Additional cash deposited in Trust Account | $ 103,055 | $ 34,352 | |||||
| Funds withdrawn from trust account reserved to payment of taxes | $ 75,773 |