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Item 1. Financial Statements

2022-11-14 compared with 2022-08-11 · 125 added, 83 removed, 546 unchanged (28% of the section changed)

1 unchanged sentence

FOCUS IMPACT ACQUISITION CORP.

CONDENSED BALANCE SHEETS

BALANCE SHEETS

September 30,

Current assets:

32 unchanged sentences

FOCUS IMPACT ACQUISITION CORP.

CONDENSED STATEMENTS OF OPERATIONS

CONDENSED STATEMENTS OF

For the Three Months Ended

For the Six Months Ended

September 30,

For the Nine Months Ended

September 30,

For the Period from February

23, 2021 (Inception) Through June 30,

23, 2021 (Inception) Through September 30,

Formation and operating costs

5 unchanged sentences

Total other income

Loss before provision for income taxes

Income (Loss) before provision for income taxes

Provision for income taxes

6 unchanged sentences

FOCUS IMPACT ACQUISITION CORP.

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ (DEFICIT) EQUITY

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2022

CONDENSED STATEMENTS OF CHANGES IN

STOCKHOLDERS’ (DEFICIT) EQUITY

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022

Class B Common Stock

1 unchanged sentence

Stockholders’

Balance as of December 31, 2021

Balance as of January 1, 2022

Balance as of March 31, 2022 (unaudited)

1 unchanged sentence

Balance as of June 30, 2022 (unaudited)

FOR THE THREE MONTHS ENDED JUNE 30, 2021 AND FOR THE PERIOD FROM FEBRUARY 23, 2021 (INCEPTION) THROUGH JUNE 30, 2021

Accretion for Class A common stock to redemption amount

Balance as of September 30, 2022 (unaudited)

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021 AND FOR THE PERIOD FROM FEBRUARY 23, 2021 (INCEPTION) THROUGH SEPTEMBER 30,

Class B Common Stock

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Balance as of June 30, 2021 (unaudited)

Balance as of September 30, 2021 (unaudited)

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

FOCUS IMPACT ACQUISITION CORP.

STATEMENTS OF CASH FLOWS

STATEMENTS OF

September 30,

Through September

Cash flows from operating activities:

Net income (loss)

Adjustments to reconcile net income (loss) to net cash used in operating activities:

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Change in fair value of warrant liability

8 unchanged sentences

Cash flows from investing activities:

Investments held in Trust account

Proceeds from Trust Account

Net cash provided by investing activities

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Deferred offering costs paid by Sponsor in exchange for issuance of Class B common stock

Deferred offering costs paid by Sponsor under the promissory note

Deferred offering costs included in accrued offerings costs and expenses

2 unchanged sentences

NOTES TO CONDENSED FINANCIAL STATEMENTS

JUNE 30, 2022

SEPTEMBER 30, 2022

Note 1 - Organization and Business Operations

6 unchanged sentences

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 June 30, 2022, the Company had not commenced any operations.

All activity for the period from February 23, 2021 (inception) through June 30, 2022 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.

As of September 30, 2022, the Company had not commenced any operations.

All activity for the period from February 23, 2021 (inception) through September 30, 2022

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.

The Company has selected December 31

as its fiscal year end.

Sponsor and Financing

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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,

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.

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.

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.

Any redemption or other repurchase that occurs after December 31, 2022, in connection with a Business Combination, extension vote or otherwise,

may be subject to the excise tax.

Whether and to what extent the Company would be subject to the excise tax in connection with a Business Combination, extension vote or otherwise would depend on a number of factors, including (i) the fair market

value of the redemptions and repurchases in connection with the Business Combination, extension or otherwise, (ii) the structure of a Business Combination, (iii) the nature and amount of any “PIPE” or other equity issuances in connection with a

Business Combination (or otherwise issued not in connection with a Business Combination but issued within the same taxable year of a Business Combination) and (iv) the content of regulations and other guidance from the Treasury.

because the excise tax would be payable by the Company and not by the redeeming holder, the mechanics of any required payment of the excise tax have not been determined.

The foregoing could cause a reduction in the cash available on hand to

complete a Business Combination and in the Company’s ability to complete a Business Combination.

Liquidity, Capital Resources and Going Concern

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The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.

As of June 30, 2022 and

December 31, 2021, the Company had cash of $ 1,087,576 and $ 1,393,939 , respectively, and no cash equivalents.

As of September 30, 2022

and December 31, 2021, the Company had cash of $ 949,402 and $ 1,393,939 , respectively, and no cash equivalents.

Investment Held in Trust Account

3 unchanged sentences

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 June 30,

As of September

30, 2022 and December 31, 2021, the Company had not experienced losses on this account and management believes the Company was not exposed to significant risks on such account.

22 unchanged sentences

$ 11.50 per share were issued on November 1, 2021.

No warrants were exercised during the three and six months ended June 30, 2022, three months ended June 30, 2021 and the period from February 23, 2021 (inception) through June 30, 2021.

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.

No warrants were exercised during the three and nine months ended September 30, 2022, three months ended September 30, 2021 and the period from February 23, 2021 (inception) through

September 30, 2021.

The calculation of diluted income (loss) 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 (loss) per common stock is the same as basic net income (loss) per common stock for the periods.

Accretion associated

with the redeemable Class A common stock is excluded from earnings per common stock as the redemption value approximates fair value.

For the Three Months Ended June 30,

Basic and diluted net income per share

Accretion associated with the redeemable Class A common stock is excluded from earnings per common stock as the redemption value approximates fair value.

For the Three Months Ended September 30,

Basic and diluted net income (loss) per share

Allocation of net income

1 unchanged sentence

Basic and diluted net income per share, redeemable common stock

For the Six Months Ended June

For the Nine Months Ended September

For the Period from February

23, 2021 (Inception) Through June 30,

23, 2021 (Inception) Through September 30,

Basic and diluted net income (loss) per share

22 unchanged sentences

be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.

As of June 30, 2022 and December 31, 2021, the Company’s deferred tax asset had a full valuation allowance recorded against

Our effective tax rate was 0.64 % and 0.00 % for the three months ended June 30, 2022 and 2021, respectively, and 0.23 %

and 0.00 % for the six months ended June 30, 2022 and 2021, respectively.

The effective tax rate differs from the statutory tax

rate of 21 % for the three and six months ended June 30, 2022 and 2021, due to changes in fair value in warrant liability

and the valuation allowance on the deferred tax assets.

As of September 30, 2022 and December 31, 2021, the Company’s deferred tax asset had a full valuation allowance recorded

Our effective tax rate was 10.04 % and 0.00 % for the three months ended September 30, 2022 and 2021, respectively, and 2.31 %

and 0.00 % for the nine months ended September 30, 2022 and 2021, respectively.

The effective tax rate differs from the

statutory tax rate of 21 % for the three and nine months ended September 30, 2022 and 2021, due to changes in fair value in

warrant liability and the valuation allowance on the deferred tax assets.

While ASC 740 identifies usage of an effective annual tax rate for purposes of an interim provision, it does allow for estimating individual elements in the current period if they are significant, unusual or

5 unchanged sentences

annualized book income and its impact on the effective tax rate.

As such, the Company is computing its taxable income (loss) and associated income tax provision based on actual results through June 30, 2022.

The Company is taking the position that the deferred tax asset related to the unutilized net operating loss (“NOL”) should still be fully reserved.

While interest rates have increased, the actual amount of

interest income for tax purposes may differ significantly due to the timing of treasuries purchased, whether the Company invests in treasuries or potential unrealized interest income based on maturity.

Additionally, the NOL utilization is

limited to 80% so the approach and estimate used in the interim period is conservative in nature while reviewing the pertinent facts unique to the Company's income tax situation.

As such, the Company is computing its taxable income (loss) and associated income tax provision based on actual results through September 30, 2022.

The Company is taking the position that the deferred tax asset related to the unutilized net

operating loss (“NOL”) should still be fully reserved.

While interest rates have increased, the actual amount of interest income for tax purposes may differ significantly due to the timing of treasuries purchased, whether the Company

invests in treasuries or potential unrealized interest income based on maturity.

Additionally, the NOL utilization is limited to 80% so the approach and estimate used in the interim period is conservative in nature while reviewing the

pertinent facts unique to the Company’s income tax situation.

ASC 740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and

5 unchanged sentences

There were no unrecognized tax benefits and no amounts

accrued for interest and penalties as of June 30, 2022 and December 31, 2021.

accrued for interest and penalties as of September 30, 2022 and December 31, 2021.

The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

15 unchanged sentences

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 June 30, 2022 and December 31, 2021, the Class A common stock subject to possible redemption reflected on the balance sheet are reconciled in the following

As of September 30, 2022 and December 31, 2021, the Class A common stock subject to possible redemption reflected on the balance sheet are reconciled in the

following table:

September 30,

As of beginning of the period

94 unchanged sentences

expectation that the founder shares would represent 20 % of the outstanding shares of common stock upon completion of the IPO.

6, 2021, the Sponsor surrendered 1,437,500 shares of Class B common stock for no consideration resulting in the Sponsor holding 5,750,000

shares of Class B common stock.

6, 2021, the Sponsor surrendered 1,437,500 shares of Class B common stock for no consideration resulting in the Sponsor holding 5,750,000 shares of Class B

common stock.

The 5,750,000 founder shares include an aggregate of up

9 unchanged sentences

the Company’s 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 the

initial Business Combination, or (y) the date on which the Company completes a liquidation, merger, stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common

stock for cash, securities or other property.

recapitalizations and the like) for any 20 trading days within any 30 -trading day period commencing at least 150 days after the initial Business

Combination, or (y) the date on which the Company completes a liquidation, merger, stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash,

securities or other property.

The Company refers to such transfer restrictions as the lock-up.

15 unchanged sentences

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

At June 30, 2022 and December 31, 2021, no such Working Capital Loans were outstanding.

The warrants would be identical to the Private Placement Warrants, including as to exercise price, exercisability and exercise period.

September 30, 2022 and December 31, 2021, no such Working Capital Loans were outstanding.

Administrative Fees

12 unchanged sentences

Underwriter Agreement

November 1, 2021, the Company paid a cash underwriting commissions of $ 4,000,000 or approximately $ 0.17 per Unit, including the over-allotment option.

The underwriters are entitled to deferred underwriting commissions of approximately $ 0.376 per unit, or $ 8,650,000 in the aggregate (including the commission

related to the underwriters’ exercise of the over-allotment option).

The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes an Initial Business Combination,

subject to the terms of the underwriting agreement for the offering.

November 1, 2021, the Company paid a cash underwriting commission of $ 4,000,000 or approximately $ 0.17 per Unit, including the over-allotment option.

The underwriters are entitled to deferred underwriting commissions of approximately $ 0.376 per unit, or $ 8,650,000 in the aggregate (including the commission related to the underwriters’

exercise of the over-allotment option).

The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes an Initial Business Combination, subject to the terms of the

underwriting agreement for the offering.

Marketing Fee Agreement

2 unchanged sentences

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 upon successful close of the Business Combination.

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

upon successful close of the Business Combination.

Note 7 - Recurring Fair Value Measurements

5 unchanged sentences

Company’s statement of operations.

The Company’s warrant liability for the Private Placement Warrants are based on valuation models utilizing inputs from observable and unobservable markets with less

The Company’s warrant liability for the Private Placement Warrants is based on valuation models utilizing inputs from observable and unobservable markets with less

volume and transaction frequency than active markets.

The inputs used to determine the fair value of the Private Warrant liability, is classified within Level 3 of the fair value hierarchy.

On December 20, 2021, the Company’s Public Warrants began trading on the Nasdaq Stock Market LLC.

The Company’s warrant liability at June 30, 2022 and December 31,

2021 for the Public Warrants is based on unadjusted quoted prices in an active market (the NASDAQ Stock Market LLC) 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.

On December 20, 2021, the Company’s Public Warrants began trading on the Nasdaq Stock Market LLC (“NASDAQ”).

The Company’s warrant liability at December 31, 2021 for

the Public Warrants 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 warrant liability as of September 30, 2022 for the public warrants is based on quoted prices in markets that are not active for identical or similar assets (NASDAQ) or liabilities that the Company has the

ability to access.

The fair value of the public warrant liability is classified within Level 2 of the fair value hierarchy.

On September 30, 2022 there was no activity for the Company’s public warrants on NASDAQ.

As such, valuation for the public

warrants was based on the NASDAQ closing price as of September 29, 2022.

Substantially all of the Company’s trust assets on the balance sheet consist of U.

2 unchanged sentences

these investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in active markets for identical assets.

The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of June 30, 2022 and

December 31, 2021, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.

June 30, 2022

The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of September 30, 2022

and December 31, 2021, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.

September 30, 2022

Investments held in Trust Account

6 unchanged sentences

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 June 30, 2022 and December 31, 2021:

June 30, 2022

The key inputs into the binomial lattice model were as follows at September 30, 2022 and December 31, 2021:

September 30, 2022

December 31, 2021

10 unchanged sentences

Fair Value at June 30, 2022 – private warrants

Change in fair value

Fair Value at September 30, 2022 – private warrants

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 June 30, 2022 and December 31, 2021, there were no shares of preferred stock issued or outstanding.

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 September 30, 2022 and December 31, 2021, there were no shares of preferred stock issued or outstanding.

Class A Common Stock

1 unchanged sentence

Holders of Class A common stock are entitled to one vote for each share.

As of June 30, 2022 and December 31, 2021, there were no shares of Class A common stock issued or outstanding, excluding 23,000,000 shares subject to possible redemption

As of September 30, 2022 and December 31, 2021, there were no shares of Class A common stock issued or outstanding, excluding 23,000,000 shares subject to possible redemption

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

Holders of the Company’s Class B common stock are entitled to one vote for each common stock.

At June 30, 2022 and December 31, 2021, there were 5,750,000 shares of Class B common stock issued and

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.

30, 2022 and December 31, 2021, there were 5,750,000 shares of Class B common stock issued and outstanding.

On March 15, 2021, the Sponsor paid $ 25,000 to the

2 unchanged sentences

expectation that the founder shares would represent 20 % of the outstanding shares of common stock upon completion of the IPO.

6, 2021, the Sponsor surrendered 1,437,500 shares of Class B common stock for no consideration resulting in the Sponsor holding 5,750,000

shares of Class B common stock.

6, 2021, the Sponsor surrendered 1,437,500 shares of Class B common stock for no consideration resulting in the Sponsor holding 5,750,000 shares of Class B

common stock.

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

2 unchanged sentences

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).

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).

Note 9 - Subsequent Events

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements