What changed in this filing

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Item 1. Financial Statements

2022-11-10 compared with 2022-08-22 · 92 added, 56 removed, 303 unchanged (33% of the section changed)

2 unchanged sentences

CONDENSED BALANCE SHEETS

September 30,

Prepaid expenses - current

8 unchanged sentences

Commitments and Contingencies (Note 6)

Common stock subject to possible redemption, 11,500,000 shares at redemption value of $ 10.21 and $ 10.20 as of June 30, 2022 and December 31, 2021, respectively

Common stock subject to possible redemption, 11,500,000 shares at redemption value of $ 10.24 and $ 10.20 as of September 30, 2022 and December 31, 2021, respectively

Stockholders’ Equity:

4 unchanged sentences

100,000,000 shares authorized;

3,550,000 shares issued and outstanding (excluding 11,500,000 shares subject to possible redemption) as of June 30, 2022 and December 31, 2021

3,550,000 shares issued and outstanding (excluding 11,500,000 shares subject to possible redemption) as of September 30, 2022 and December 31, 2021

Additional paid-in capital

Accumulated deficit

Accumulated earnings

Total Stockholders’ Equity

3 unchanged sentences

UNAUDITED CONDENSED STATEMENTS OF OPERATIONS

For the Period from

For the Nine Months

(Inception) to

For the Three Months Ended September 30

September 30,

Formation and operating cost

3 unchanged sentences

Total other income

Loss before provision for income taxes

Income (loss) before provision for income taxes

Provision for income taxes

Net income (loss)

Basic and diluted weighted average shares outstanding, redeemable shares

Basic and diluted loss per common stock, redeemable shares

Basic and diluted income (loss) per common stock, redeemable shares

Basic and diluted weighted average shares outstanding, non-redeemable shares

Basic and diluted loss per common stock, non-redeemable shares

Basic and diluted income (loss) per common stock, non-redeemable shares

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

1 unchanged sentence

UNAUDITED CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2022

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022

Stockholders’

Balance as of December 31, 2021

Balance as of March 31, 2022

Remeasurement of carrying value to redemption value of shares subject to redemption

Remeasurement of carrying value to redemption value of shares subject to possible redemption

Balance as of June 30, 2022

FOR THE PERIOD FROM MAY 14, 2021 (INCEPTION) THROUGH JUNE 30, 2021

Remeasurement of carrying value to redemption value of shares subject to possible redemption

Balance as of September 30, 2022

FOR THE PERIOD FROM MAY 14, 2021 (INCEPTION) THROUGH SEPTEMBER 30, 2021

Stockholders’

3 unchanged sentences

Balance as of June 30, 2021

Remeasurement of carrying value to redemption value of shares subject to possible redemption

Balance as of September 30, 2021

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

4 unchanged sentences

(inception) through

September 30,

Cash Flows from Operating Activities:

3 unchanged sentences

Changes in operating assets and liabilities:

Accounts receivable

Prepaid expenses

5 unchanged sentences

Proceeds from issuance of common stock to Sponsor

Proceeds from issuance of promissory note to related party

Net cash provided by financing activities

5 unchanged sentences

Remeasurement of common stock subject to possible redemption

Deferred offering costs included in accrued offerings costs and expenses

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

1 unchanged sentence

NOTES TO CONDENSED FINANCIAL STATEMENTS

June 30, 2022

September 30, 2022

Note 1 — Organization and Business Operations

3 unchanged sentences

The Company does not have any specific Business Combination under consideration and it has not (nor has anyone on its behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction with the Company.

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

All activity for the period from May 14, 2021 (inception) through June 30, 2022 relates to the Company’s formation and the initial public offering described below.

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

All activity for the period from May 14, 2021 (inception) through September 30, 2022 relates to the Company’s formation and the initial public offering described below.

The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest.

29 unchanged sentences

Liquidity and Capital Resources

As of June 30, 2022, the Company had $ 534,389 in its operating bank account and working capital of $ 864,341 , excluding taxes.

The Company’s liquidity needs through June 30, 2022 were satisfied through a payment from the Sponsor of $ 25,000 (see Note 5) for the Founder Shares to cover certain offering costs and the loan under an unsecured promissory note from the Sponsor of up to $ 400,000 .

As of September 30, 2022, the Company had $ 347,671 in its operating bank account and working capital of $ 527,665 , excluding taxes.

The Company’s liquidity needs through September 30, 2022 were satisfied through a payment from the Sponsor of $ 25,000 (see Note 5) for the Founder Shares to cover certain offering costs and the loan under an unsecured promissory note from the Sponsor of up to $ 400,000 .

The outstanding balance under the promissory note of $ 323,190 was paid in full and the unsecured promissory note is no longer available to the Company.

As of June 30, 2022, no amounts were outstanding under the unsecured promissory note.

As of September 30, 2022, no amounts were outstanding under the unsecured promissory note.

After consummation of the IPO on October 21, 2021, the Company had $ 24,991 in its operating bank account, and working capital of $ 1,463,454 , which included $ 2,150,000 of private placement proceeds receivable from the Sponsor which was received into the Company’s operating bank account on October 22, 2021.

In addition, in order to finance transaction costs in connection with a Business Combination, the Company’s Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, provide the Company Working Capital Loans, as defined below (see Note 5).

As of June 30, 2022, there were no amounts outstanding under any Working Capital Loans.

As of September 30, 2022, there were no amounts outstanding under any Working Capital Loans.

Going Concern

The Company anticipates that the $ 534,389 held outside the Trust Account as of June 30, 2022 may not be sufficient to allow the Company to operate for at least 12 months from the issuance of the financial statements, assuming that a business combination is not consummated during that time.

The Company anticipates that the $ 347,671 held outside the Trust Account as of September 30, 2022 may not be sufficient to allow the Company to operate for at least 12 months from the issuance of the financial statements, assuming that a business combination is not consummated during that time.

Until consummation of its business combination, the Company will be using the funds not held in the Trust Account, and any additional Working Capital Loans (as defined in Note 5) from the initial shareholders, certain of the Company’s officers and directors (see Note 5), for identifying and evaluating prospective acquisition candidates, performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting the target business to acquire and structuring, negotiating and consummating the business combination.

12 unchanged sentences

The unaudited condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Inflation Reduction Act of 2022

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.

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.

In addition, 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.

Note 2 — Significant Accounting Policies

5 unchanged sentences

The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the SEC on June 21, 2022, which contains the audited financial statements and notes thereto.

The interim results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future interim periods.

The interim results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future interim periods.

Emerging Growth Company Status

11 unchanged sentences

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

The Company did not have any cash equivalents as of June 30, 2022 and December 31, 2021.

The Company did not have any cash equivalents as of September 30, 2022 and December 31, 2021 other than those in the Trust Account.

Cash and Securities Held in Trust Account

As of June 30, 2022 and December 31, 2021, the company had $ 117,547,523 and $ 117,310,928 , respectively, in cash and securities held in the trust account which was invested in cash and US Treasury bills.

As of September 30, 2022 and December 31, 2021, the company had $ 118,088,738 and $ 117,310,928 , respectively, in cash and securities held in the trust account which were invested in US Treasury bills.

Net proceeds of the sale of the Units in the Public Offering and the sale of the Private Placement Units were placed in the Trust Account which will only be invested in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 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.

26 unchanged sentences

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

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

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 infrequent.

Computing the effective tax rate for the Company is complicated due to the potential impact of the timing of any Business Combination expenses and the actual interest income that will be recognized during the year.

The Company has taken a position as to the calculation of income tax expense in a current period based on ASC 740-270-25-3 which states, “If an entity is unable to estimate a part of its ordinary income (or loss) or the related tax (benefit) but is otherwise able to make a reasonable estimate, the tax (or benefit) applicable to the item that cannot be estimated shall be reported in the interim period in which the item is reported.” The Company believes its calculation to be a reliable estimate and allows it to properly take into account the usual elements that can impact its 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 September 30, 2022.

ASC 740-270-25-2 requires that an annual effective tax rate be determined and such annual effective rate applied to year to date income in interim periods under ASC 740-270-30-5.

Our effective tax rate was - 10 % for the three months ended June 30, 2022, and - 4 % and 0 % for the six months ended June 30, 2022 and for the period from May 14, 2021 (inception) through June 30, 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 for the period from May 14, 2021 (inception) through June 30, 2021, due to the valuation allowance on the deferred tax assets.

Our effective tax rate was 36 % and 0 % for the three months ended September 30, 2022 and September 30, 2021, respectively, and 651 % and 0 % for the nine months ended September 30, 2022 and for the period from May 14, 2021 (inception) through September 30, 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 for the period from May 14, 2021 (inception) through September 30, 2021, due to the valuation allowance on the deferred tax assets.

ASC 740 also 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.

2 unchanged sentences

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 June 30, 2022 and December 31, 2021.

There were no unrecognized tax benefits and no amounts 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.

9 unchanged sentences

The Company accounts for its outstanding warrants as equity-classified instruments.

Net Loss Per Common Stock

The Company complies with the accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net loss per common stock is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

At June 30, 2022 and December 31, 2021,the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company.

As a result, diluted loss per common stock is the same as basic loss per common stock for the period presented.

The table below presents a reconciliation of the numerator and denominator used to compute basic and diluted net loss per share for each component of common stock for the three and six months ended June 30, 2022:

For the Period from May 14, 2021

Net Income (Loss) Per Common Stock

The Company complies with the accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net income (loss) per common stock is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period.

At September 30, 2022 and December 31, 2021, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company.

As a result, diluted income (loss) per common stock is the same as basic income (loss) per common stock for the period presented.

The table below presents a reconciliation of the numerator and denominator used to compute basic and diluted net income (loss) per share for each component of common stock for the three and nine months ended September 30, 2022, for the three months ended September 30, 2021 and for the period from May 14, 2021 (inception) to September 30, 2021:

Three Months Ended

Six Months Ended

(Inception) Through

June 30, 2022

June 30, 2021

Three Months Ended

September 30, 2022

September 30, 2021

Non-redeemable

Basic and diluted net income (loss) per common stock:

Allocation of net income (loss)

Basic and diluted weighted-average shares outstanding

Basic and diluted net income (loss) per share

Nine Months Ended

For the period from May 14, 2021

September 30, 2022

(inception) to September 30, 2021

Non-redeemable

Basic and diluted net loss per common stock:

Allocation of net loss

Weighted-average shares outstanding

Basic and diluted weighted-average shares outstanding

Basic and diluted net loss per share

1 unchanged sentence

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 .

At June 30, 2022 and December 31, 2021, the Company had not experienced losses on this account.

At September 30, 2022 and December 31, 2021, the Company had not experienced losses on this account.

Recent Accounting Pronouncements

18 unchanged sentences

The change in the carrying value of redeemable common stock resulted in charges against additional paid-in capital and accumulated deficit.

As of June 30, 2022 and December 31, 2021, the common stock reflected on the condensed balance sheets are reconciled in the following table:

As of September 30, 2022 and December 31, 2021, the common stock reflected on the condensed balance sheets are reconciled in the following table:

Gross proceeds

4 unchanged sentences

Remeasurement of carrying value to redemption value

Common stock subject to possible redemption at December 31, 2021

Common stock of shares subject to possible redemption at December 31, 2021

Remeasurement of carrying value to redemption value

Common stock subject to possible redemption at June 30, 2022

Common stock of shares subject to possible redemption at September 30, 2022

Note 4 — Private Placement

8 unchanged sentences

The number of Founder Shares outstanding was determined based on the expectation that the total size of the IPO would be a maximum of 11,500,000 Units if the underwriter’s over-allotment option is exercised in full, and therefore that such Founder Shares would represent 20 % of the outstanding shares after the IPO.

As of June 30, 2022 and December 31, 2021, of the 2,875,000 shares outstanding, none of which were subject to forfeiture due to the full exercise of the over-allotment option by the underwriters upon the consummation of the IPO.

The initial stockholders have agreed not to transfer, assign or sell (i) any of the Founder Shares until six months after the date of the consummation of the initial Business Combination or earlier if, subsequent to the initial Business Combination, the Company consummates a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of the stockholders having the right to exchange their common stock for cash, securities or other property or (ii) any of the Private Placement Units until the completion of the initial Business Combination.

As of September 30, 2022 and December 31, 2021, of the 2,875,000 shares outstanding, none of which were subject to forfeiture due to the full exercise of the over-allotment option by the underwriters upon the consummation of the IPO.

The initial stockholders have agreed not to transfer, assign or sell (i) any of the Founder Shares until nine months after the date of the consummation of the initial Business Combination or earlier if, subsequent to the initial Business Combination, the Company consummates a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of the stockholders having the right to exchange their common stock for cash, securities or other property or (ii) any of the Private Placement Units until the completion of the initial Business Combination.

The representative’s Private Placement Units are identical to the Units sold in the IPO except that they may not (including the common stock issuable upon exercise of these warrants), subject to certain limited exceptions, be transferred, assigned or sold by the holders until after the completion of the initial Business Combination.

4 unchanged sentences

At December 31, 2021, the outstanding balance under the promissory note of $ 323,190 had been paid in full and the unsecured promissory note is no longer available to the Company.

As of June 30, 2022 and December 31, 2021 , no amounts were outstanding under the unsecured promissory note.

As of September 30, 2022 and December 31, 2021, no amounts were outstanding under the unsecured promissory note.

Working Capital Loans

3 unchanged sentences

If the Company consummates an initial Business Combination, the notes would either be paid upon consummation of the initial Business Combination, without interest, or, at the lender’s discretion, up to $ 1,000,000 of the notes may be converted upon consummation of the Business Combination into additional Private Placement Units at a price of $ 10.00 per unit (which, for example, would result in the holders being issued 100,000 units if the full amount of notes are issued and converted).

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

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

Administrative Service Fee

1 unchanged sentence

Upon completion of the Company’s initial Business Combination or its liquidation, the Company will cease paying these monthly fees.

At June 30, 2022 and December 31, 2021, the Company had accrued $ 16,435 and $ 24,516 , respectively, of administrative service fees.

For three and six months ended June 30, 2022, the Company incurred $ 30,000 and $ 60,000 of administrative service fees expense, respectively.

For the period from May 14, 2021 (inception) through June 30, 2021, the Company did not incur any fees for these services.

At September 30, 2022 and December 31, 2021, the Company had accrued $ 21,356 and $ 24,516 , respectively, of administrative service fees.

For three and nine months ended September 30, 2022, the Company incurred $ 30,000 and $ 90,000 of administrative service fees expense, respectively.

For the three months September 30, 2021, and for the period from May 14, 2021 (inception) through September 30, 2021, the Company did not incur any fees for these services.

Note 6 — Commitments and Contingencies

13 unchanged sentences

The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $ 0.0001 per share.

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

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

The Company is authorized to issue 100,000,000 shares of common stock with a par value of $ 0.0001 per share.

Holders of the common stock are entitled to one vote for each common stock.

At June 30, 2022 and December 31, 2021, there were 3,550,000 shares of common stock issued and outstanding, none of which were subject to forfeiture due to the full exercise of the over-allotment option by the underwriters upon the consummation of the IPO.

As of June 30, 2022 and December 31, 2021, there were no warrants outstanding.

At September 30, 2022 and December 31, 2021, there were 3,550,000 shares of common stock issued and outstanding, none of which were subject to forfeiture due to the full exercise of the over-allotment option by the underwriters upon the consummation of the IPO.

As of September 30, 2022 and December 31, 2021, there were no warrants outstanding.

Upon closing of the IPO on October 21, 2021, there were 8,625,000 public warrants and 506,250 private warrants outstanding.

20 unchanged sentences

Note 8 — Held-to-Maturity Investments

At June 30, 2022 and December 31, 2021, the amortized cost basis of held-to-maturity investments is $ 117,360,085 and $ 117,299,993 , respectively, and net carrying amount is $ 117,545,237 and $ 117,310,921 , respectively, including interest of $ 196,313 , $ 236,595 and $ 10,928 earned during the three and six months ended June 30, 2022 and the period from May 14, 2021 (inception) through December 31, 2021, respectively.

At September 30, 2022 and December 31, 2021, the amortized cost basis of held-to-maturity investments is $ 117,950,894 and $ 117,299,993 , respectively, and net carrying amount is $ 118,088,173 and $ 117,310,921 , respectively, including interest of $ 541,215 , $ 777,810 and $ 10,928 earned during the three and nine months ended September 30, 2022 and the period from May 14, 2021 (inception) through December 31, 2021, respectively.

A reconciliation from amortized cost basis to net carrying amount and fair value is provided below:

June 30, 2022

September 30, 2022

December 31, 2021

1 unchanged sentence

Interest earned on investments

Earnings attributable to investments matured during the period

Held-to-maturity investments, net carrying amount

1 unchanged sentence

Held-to-maturity investments, fair value

There are no indicators of impairment, including other-than-temporary impairments, with respect to the held-to-maturity investments as of June 30, 2022 or December 31, 2021.

There are no indicators of impairment, including other-than-temporary impairments, with respect to the held-to-maturity investments as of September 30, 2022 or December 31, 2021.

All investments mature within one year of the date of these financial statements;

4 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