☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 85-2533565 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) | |
400 Perimeter Center Terrace Suite 151 Atlanta, Georgia | 30346 | |
(Address of Principal Executive Offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Units, each consisting of one share of Class A common stock and one-half of one redeemable warrant | ALTUU | |||
Class A common stock, par value $0.0001 per share | ALTU | The Nasdaq Stock Market LLC | ||
Warrants, each whole warrant exercisable for one share of Class A common stock, each at an initial exercise price of $11.50 per share | ALTUW | |||
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
Emerging growth company | ☒ |
Altitude Acquisition Corp.
Quarterly Report on
Form 10-Q
For the Quarter Ended September 30,
2022March 31, 2023
2
September 30, 2022 | December 31, 2021 | March 31, 2023 | December 31, 2022 | |||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||
Assets: | ||||||||||||||||
Assets | ||||||||||||||||
Current Assets | ||||||||||||||||
Cash | $ | 24,338 | $ | 43,054 | $ | 31,467 | $ | 760 | ||||||||
Prepaid expenses | 27,065 | 187,288 | 54,131 | 815 | ||||||||||||
Total current assets | 51,403 | 230,342 | 85,598 | 1,575 | ||||||||||||
Investments held in Trust Account | 50,865,089 | 300,026,796 | ||||||||||||||
Cash held in Trust Account | 16,851,596 | 16,975,796 | ||||||||||||||
Total assets | $ | 50,916,492 | $ | 300,257,138 | ||||||||||||
Total Assets | $ | 16,937,194 | $ | 16,977,371 | ||||||||||||
Liabilities, Class A common stock subject to possible redemption and Stockholders’ Deficit: | ||||||||||||||||
Current Liabilities | ||||||||||||||||
Accounts payable | $ | 371,486 | $ | 174,803 | $ | 983,423 | $ | 511,152 | ||||||||
Income tax es payable | 22,803 | — | ||||||||||||||
Income taxes payable | 38,180 | 38,180 | ||||||||||||||
Advances from Sponsor | 888,423 | 100,000 | 869,044 | 802,644 | ||||||||||||
Due to related party | 212,089 | 122,089 | ||||||||||||||
Promissory Note – Related Party | 135,000 | — | ||||||||||||||
Due to related party, net | — | 242,089 | ||||||||||||||
Total current liabilities | 1,494,801 | 396,892 | 2,025,647 | 1,594,065 | ||||||||||||
Warrant liability | 1,534,144 | 13,449,283 | 1,213,014 | 1,383,449 | ||||||||||||
Deferred legal fee | 5,284,253 | 3,733,738 | 6,257,979 | 5,352,657 | ||||||||||||
Deferred underwriting fee | 10,500,000 | 10,500,000 | 10,500,000 | 10,500,000 | ||||||||||||
Total liabilities | 18,813,198 | 28,079,913 | 19,996,640 | 18,830,171 | ||||||||||||
Commitments and Contingencies | ||||||||||||||||
Class A common stock subject to possible redemption, $0.0001 par value, 5,055,051 and 30,000,000 shares subject to possible redemption at redemption value of $10.00 per share at September 30, 2022 and December 31, 2021, respectively | 50,550,510 | 300,000,000 | ||||||||||||||
Class A common stock subject to possible redemption, $0.0001 par value, 1,672,102 shares subject to possible redemption at redemption value of $10.00 per share at March 31, 2023 and December 31, 2022 | 16,721,020 | 16,721,020 | ||||||||||||||
Stockholders’ deficit: | ||||||||||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; no shares issued or outstanding at September 30, 2022 and December 31, 2021 | — | — | ||||||||||||||
Class A common stock, $0.0001 par value, 280,000,000 shares authorized; and no non-redeemable shares issued or outstanding at September 30, 2022 and December 31, 2021, respectively | — | — | ||||||||||||||
Class B common stock, $0.0001 par value, 20,000,000 shares authorized, 7,500,000 shares issued and outstanding at September 30, 2022 and December 31, 2021 | 750 | 750 | ||||||||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; no shares issued or outstanding at March 31, 2023 and December 31, 2022 | — | — | ||||||||||||||
Class A common stock, $0.0001 par value, 280,000,000 shares authorized; and non-redeemable shares issued or outstanding at March 31, 2023 and December 31, 2022 | — | — | ||||||||||||||
Class B common stock, $0.0001 par value, 20,000,000 shares authorized, 7,500,000 shares issued and outstanding at March 31, 2023 and December 31, 2022 | 750 | 750 | ||||||||||||||
Additional paid-in capital | — | — | 493,955 | 251,866 | ||||||||||||
Accumulated deficit | (18,447,966 | ) | (27,823,525 | ) | (20,275,171 | ) | (18,826,436 | ) | ||||||||
Total stockholders’ deficit | (18,447,216 | ) | (27,822,775 | ) | (19,780,466 | ) | (18,573,820 | ) | ||||||||
Total liabilities, Class A common stock subject to possible redemption and stockholders’ deficit | $ | 50,916,492 | $ | 300,257,138 | $ | 16,937,194 | $ | 16,977,371 | ||||||||
For the Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Formation and operating costs | $ | 1,619,190 | $ | 928,218 | ||||
Loss from operations | (1,619,190 | ) | (928,218 | ) | ||||
Other income | ||||||||
Interest income | 20 | 1 | ||||||
Interest income earned on Trust | — | 7,600 | ||||||
Unrealized gain on change in fair value of warrants | 170,435 | 9,537,808 | ||||||
Total other income | 170,455 | 9,545,409 | ||||||
(Loss) Income before income tax provision | (1,448,735 | ) | 8,617,191 | |||||
Income tax provision | — | — | ||||||
Net (loss) income | $ | (1,448,735 | ) | $ | 8,617,191 | |||
Basic and diluted weighted average shares outstanding, Class A common stock | 1,672,102 | 30,000,000 | ||||||
Basic and diluted net (loss) income per share, Class A common stock | $ | (0.16 | ) | $ | 0.23 | |||
Basic and diluted weighted average shares outstanding, Class B common stock | 7,500,000 | 7,500,000 | ||||||
Basic and diluted net (loss) income per share, Class B common stock | $ | (0.16 | ) | $ | 0.23 | |||
For the three months ended September 30, 2022 | For the three months ended September 30, 2021 | For the nine months ended September 30, 2022 | For the nine months ended September 30, 2021 | |||||||||||||
Formation and operating costs | $ | 439,362 | $ | 4,903,000 | $ | 2,885,762 | $ | 5,749,195 | ||||||||
Loss from operations | (439,362 | ) | (4,903,000 | ) | (2,885,762 | ) | (5,749,195 | ) | ||||||||
Other income | ||||||||||||||||
Interest income | 1 | 3 | 2 | 23 | ||||||||||||
Interest income earned on Trust | 222,471 | 6,165 | 534,340 | 19,240 | ||||||||||||
Unrealized gain on change in fair value of warrants | 1,389,550 | 4,327,824 | 11,915,139 | 17,773,513 | ||||||||||||
Total other income | 1,612,022 | 4,333,992 | 12,449,481 | 17,792,776 | ||||||||||||
Income (loss) before income tax provision | 1,172,660 | (569,008 | ) | 9,563,719 | 12,043,581 | |||||||||||
Income tax provision | (14,023 | ) | — | (22,803 | ) | — | ||||||||||
Net income (loss) | $ | 1,158,637 | $ | (569,008 | ) | $ | 9,540,916 | $ | 12,043,581 | |||||||
Basic and diluted weighted average shares outstanding, Class A common stock | 5,055,051 | 30,000,000 | 20,040,295 | 30,000,000 | ||||||||||||
Basic and diluted net income (loss) per share, Class A common stock | $ | 0.09 | $ | (0.02 | ) | $ | 0.35 | $ | 0.32 | |||||||
Basic and diluted weighted average shares outstanding, Class B common stock | 7,500,000 | 7,500,000 | 7,500,000 | 7,500,000 | ||||||||||||
Basic and diluted net income (loss) per share, Class B common stock | $ | 0.09 | $ | (0.02 | ) | $ | 0.35 | $ | 0.32 | |||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of December 31, 2021 | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (27,823,525 | ) | $ | (27,822,775 | ) | ||||||||||||||
Net income | — | — | — | — | — | 8,617,191 | 8,617,191 | |||||||||||||||||||||
Balance as of March 31, 2022 (unaudited) | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (19,206,334 | ) | $ | (19,205,584 | ) | ||||||||||||||
Net loss | — | — | — | — | — | (234,912 | ) | (234,912 | ) | |||||||||||||||||||
Accretion of Class A common stock to redemption value | — | — | — | — | — | (165,357 | ) | (165,357 | ) | |||||||||||||||||||
Balance as of June 30, 2022 (unaudited) | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (19,606,603 | ) | $ | (19,605,853 | ) | ||||||||||||||
Net income | — | — | — | — | — | 1,158,637 | 1,158,637 | |||||||||||||||||||||
Balance as of September 30, 2022 (unaudited) | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (18,447,966 | ) | $ | (18,447,216 | ) | ||||||||||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of December 31, 2022 | — | $ | — | 7,500,000 | $ | 750 | $ | 251,866 | $ | (18,826,436 | ) | $ | (18,573,820 | ) | ||||||||||||||
Sponsor administrative agreement waiver | — | — | — | — | 242,089 | — | 242,089 | |||||||||||||||||||||
Net loss | — | — | — | — | — | (1,448,735 | ) | (1,448,735 | ) | |||||||||||||||||||
Balance as of March 31, 2023 (unaudited) | — | $ | — | 7,500,000 | $ | 750 | $ | 493,955 | $ | (20,275,171 | ) | $ | (19,780,466 | ) | ||||||||||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of December 31, 2020 | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (43,049,354 | ) | $ | (43,048,604 | ) | ||||||||||||||
Net loss | — | — | — | — | — | (6,456,287 | ) | (6,456,287 | ) | |||||||||||||||||||
Balance as of March 31, 2021 (unaudited) | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (49,505,641 | ) | $ | (49,504,891 | ) | ||||||||||||||
Net income | — | — | — | — | — | 19,068,876 | 19,068,876 | |||||||||||||||||||||
Balance as of June 30, 2021 (unaudited) | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (30,436,765 | ) | $ | (30,436,015 | ) | ||||||||||||||
Net loss | — | — | — | — | — | (569,008 | ) | (569,008 | ) | |||||||||||||||||||
Balance as of September 30, 2021 (unaudited) | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (31,005,773 | ) | $ | (31,005,023 | ) | ||||||||||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of December 31, 2021 | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (27,823,525 | ) | $ | (27,822,775 | ) | ||||||||||||||
Net income | — | — | — | — | — | 8,617,191 | 8,617,191 | |||||||||||||||||||||
Balance as of March 31, 2022 (unaudited) | — | $ | — | 7,500,000 | $ | 750 | $ | — | $ | (19,206,334 | ) | $ | (19,205,584 | ) | ||||||||||||||
For the Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net (loss) income | $ | (1,448,735) | $ | 8,617,191 | ||||
Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||||||||
Interest income earned on Trust | — | (7,600 | ) | |||||
Unrealized gain on change in fair value of warrants | (170,435 | ) | (9,537,808 | ) | ||||
Changes in current assets and current liabilities: | ||||||||
Prepaid expenses | (53,316 | ) | 42,055 | |||||
Due to related party, net | — | 30,000 | ||||||
Deferred legal fee | 905,322 | 510,020 | ||||||
Income taxes payable | — | — | ||||||
Advances from Sponsor | 66,400 | 350,000 | ||||||
Accounts payable and accrued expenses | 472,271 | (23,941 | ) | |||||
Net cash used in operating activities | (228,493 | ) | (20,083 | ) | ||||
Cash Flows from Investing Activities: | ||||||||
Cash withdrawn from Trust Account to pay franchise and income taxes | 124,200 | — | ||||||
Net cash provided by investing activities | 124,200 | — | ||||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from Promissory note – related party | 135,000 | — | ||||||
Net cash provided by financing activities | 135,000 | — | ||||||
Net Change in Cash | 30,707 | (20,083 | ) | |||||
Cash-Beginning | 760 | 43,054 | ||||||
Cash-Ending | $ | 31,467 | $ | 22,971 | ||||
Supplemental Disclosure of Non-cash Financing Activities: | ||||||||
Waived Administrative Support Fee | $ | 242,089 | $ | — | ||||
For the nine months ended September 30, 2022 | For the nine months ended September 30, 2021 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income | $ | 9,540,916 | $ | 12,043,581 | ||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||
Interest income earned on Trust | (534,340 | ) | (19,240 | ) | ||||
Unrealized gain on change in fair value of warrants | (11,915,139 | ) | (17,773,513 | ) | ||||
Changes in current assets and current liabilities: | ||||||||
Prepaid expenses | 160,223 | 340,379 | ||||||
Due to related party | 90,000 | 89,204 | ||||||
Deferred legal fee | 1,550,515 | 4,594,437 | ||||||
Income tax es payable | 22,803 | — | ||||||
Advances from Sponsor | 788,423 | — | ||||||
Accounts payable and accrued expenses | 196,683 | 94,878 | ||||||
Net cash used in operating activities | (99,916 | ) | (630,274 | ) | ||||
Cash Flows from Investing Activities: | ||||||||
Funds withdrawn from Trust Account | 81,200 | — | ||||||
Net cash provided by investing activities | 81,200 | — | ||||||
Net Change in Cash | (18,716 | ) | (630,274 | ) | ||||
Cash-Beginning | 43,054 | 764,329 | ||||||
Cash-Ending | $ | 24,338 | $ | 134,055 | ||||
Supplemental Disclosure of Non-cash Financing Activities: | ||||||||
Payment from Trust Account in connection with redemption of shares | $ | 249,614,847 | $ | — | ||||
For the three months ended September 30, 2022 | For the three months ended September 30, 2021 | |||||||||||||||
Class A | Class B | Class A | Class B | |||||||||||||
Basic and diluted net income (loss) per share: | ||||||||||||||||
Numerator: | ||||||||||||||||
Allocation of net income (loss) | $ | 466,503 | $ | 692,134 | $ | (455,206 | ) | $ | (113,802 | ) | ||||||
Denominator: | ||||||||||||||||
Weighted-average shares outstanding | 5,055,051 | 7,500,000 | 30,000,000 | 7,500,000 | ||||||||||||
Basic and diluted net income (loss) per share | $ | 0.09 | $ | 0.09 | $ | (0.02 | ) | $ | (0.02 | ) |
For the nine months ended September 30, 2022 | For the nine months ended September 30, 2021 | For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||
Class A | Class B | Class A | Class B | 2023 | 2022 | |||||||||||||||||||||||||||
Basic and diluted net income per share: | ||||||||||||||||||||||||||||||||
Class A | Class B | Class A | Class B | |||||||||||||||||||||||||||||
Basic and diluted net (loss) income per share: | ||||||||||||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||||||||||
Allocation of net income | $ | 6,942,655 | $ | 2,598,261 | $ | 9,634,865 | $ | 2,408,716 | ||||||||||||||||||||||||
Allocation of net (loss) income | $ | (264,109 | ) | $ | (1,184,626 | ) | $ | 6,893,753 | $ | 1,723,438 | ||||||||||||||||||||||
Denominator: | ||||||||||||||||||||||||||||||||
Weighted-average shares outstanding | 20,040,295 | 7,500,000 | 30,000,000 | 7,500,000 | 1,672,102 | 7,500,000 | 30,000,000 | 7,500,000 | ||||||||||||||||||||||||
Basic and diluted net income per share | $ | 0.35 | $ | 0.35 | $ | 0.32 | $ | 0.32 | ||||||||||||||||||||||||
Basic and diluted net (loss) income per share | $ | (0.16 | ) | $ | (0.16 | ) | $ | 0.23 | $ | 0.23 |
Gross proceeds from IPO | $ | 300,000,000 | $ | 300,000,000 | ||||
Less: | ||||||||
Proceeds allocated to Public Warrants | (19,987,400 | ) | (19,987,400 | ) | ||||
Common stock issuance costs | (15,968,970 | ) | (15,968,970 | ) | ||||
Payment from Trust Account in connection with redemption of shares Plus: | (249,614,847 | ) | ||||||
Payment from Trust Account in connection with redemption of shares | (283,624,535 | ) | ||||||
Plus: | ||||||||
Accretion of carrying value to redemption value | 36,121,727 | 36,301,925 | ||||||
Class A common stock subject to possible redemption | $ | 50,550,510 | ||||||
Class A common stock subject to possible redemption, December 31, 2022 | 16,721,020 | |||||||
Class A common stock subject to possible redemption, March 31, 2023 | $ | 16,721,020 | ||||||
Gross proceeds from IPO | $ | 300,000,000 | ||
Less: | ||||
Proceeds allocated to Public Warrants | (19,987,400 | ) | ||
Common stock issuance costs | (15,968,970 | ) | ||
Plus: | ||||
Accretion of carrying value to redemption value | 35,956,370 | |||
Class A common stock subject to possible redemption | $ | 300,000,000 | ||
September 30, 2022 | Quoted Prices In Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
Assets: | ||||||||||||||||
Money Market Funds held in Trust Account | $ | 50,865,089 | $ | 50,865,089 | $ | — | $ | — | ||||||||
Liabilities: | ||||||||||||||||
Warrant Liability—Public Warrants | $ | 973,500 | $ | 973,500 | $ | — | $ | — | ||||||||
Warrant Liability—Private Placement Warrants | $ | 560,644 | $ | — | $ | — | $ | 560,644 | ||||||||
$ | 1,534,144 | $ | 973,500 | $ | — | $ | 560,644 | |||||||||
December 31, 2021 | Quoted Prices In Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
Assets: | ||||||||||||||||
Money Market Funds held in Trust Account | $ | 300,026,796 | $ | 300,026,796 | $ | — | $ | — | ||||||||
Liabilities: | ||||||||||||||||
Warrant Liability—Public Warrants | $ | 8,626,500 | $ | 8,626,500 | $ | — | $ | — | ||||||||
Warrant Liability—Private Placement Warrants | $ | 4,822,783 | $ | — | $ | — | $ | 4,822,783 | ||||||||
$ | 13,449,283 | $ | 8,626,500 | $ | — | $ | 4,822,783 | |||||||||
Input | September 30, 2022 | |||
Expected term (years) | 5.54 | |||
Expected volatility | 4.00 | % | ||
Risk-free interest rate | 4.04 | % | ||
Exercise price | $ | 11.50 | ||
Fair value of the common stock price | $ | 10.05 |
Input | December 31, 2021 | |||
Expected term (years) | 5.37 | |||
Expected volatility | 12.4 | % | ||
Risk-free interest rate | 1.29 | % | ||
Exercise price | $ | 11.50 | ||
Fair value of the common stock price | $ | 9.90 |
Warrant Liability | ||||
Fair value as of December 31, 2021 | $ | 4,822,783 | ||
Change in fair value | (3,428,308 | ) | ||
Fair value as of March 31, 2022 | 1,394,475 | |||
Change in fair value | (344,281 | ) | ||
Fair value as of June 30, 2022 | $ | 1,050,194 | ||
Chang e in fair value | (489,550 | ) | ||
Fair value as of September 30, 2022 | $ | 560,644 | ||
Warrant Liability | ||||
Fair value as of December 31, 2020 | $ | 33,807,463 | ||
Transfer out of Level 3 to Level 1 | (25,500,000 | ) | ||
Change in fair value | 5,996,188 | |||
Fair value as of March 31, 2021 | 14,303,651 | |||
Change in fair value | (6,657,377 | ) | ||
Fair value as of June 30, 2021 | $ | 7,646,274 | ||
Chang e in fair value | (1,812,324 | ) | ||
Fair value as of September 30, 2021 | 5,833,950 | |||
March 31, 2023 | Quoted Prices In Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
Liabilities: | ||||||||||||||||
Warrant Liability—Public Warrants | $ | 768,000 | $ | 768,000 | $ | — | $ | — | ||||||||
Warrant Liability—Private Placement Warrants | $ | 445,014 | — | — | 445,014 | |||||||||||
$ | 1,213,014 | $ | 768,000 | $ | — | $ | 445,014 | |||||||||
December 31, 2022 | Quoted Prices In Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
Liabilities: | ||||||||||||||||
Warrant Liability—Public Warrants | $ | 877,500 | $ | 877,500 | $ | — | $ | — | ||||||||
Warrant Liability—Private Placement Warrants | $ | 505,949 | — | — | 505,949 | |||||||||||
$ | 1,383,449 | $ | 877,500 | $ | — | $ | 505,949 | |||||||||
Input | March 31, 2023 | |||
Expected term (years) | 5.97 | |||
Expected volatility | 7.1 | % | ||
Risk-free interest rate | 4.66 | % | ||
Exercise price | $ | 11.50 | ||
Fair value of the common stock price | $ | 10.18 |
Input | December 31, 2022 | |||
Expected term (years) | 1.15 | |||
Expected volatility | 7.9 | % | ||
Risk-free interest rate | 4.68 | % | ||
Exercise price | $ | 11.50 | ||
Fair value of the common stock price | $ | 9.92 |
Warrant Liability | ||||
Fair value as of December 31, 2022 | $ | 505,949 | ||
Change in fair value | (60,935 | ) | ||
Fair value as of March 31, 2023 | $ | 445,014 | ||
Warrant Liability | ||||
Fair value as of December 31, 2021 | $ | 4,822,783 | ||
Change in fair value | (3,428,308 | ) | ||
Fair value as of March 31, 2022 | 1,394,475 | |||
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
References to “we”, “us”, “our” or the “Company” are to Altitude Acquisition Corp., except where the context requires otherwise. The following discussion should be read in conjunction with our unaudited condensed consolidated financial statements and related notes thereto included elsewhere in this report.
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other Securities and Exchange Commission (“SEC”) filings.
Overview
We are a blank check company incorporated on August 12, 2020 as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similarbusiness combination. On December 9, 2022, we announced that we had signed a non-binding letter of intent for our initial business combination with onethe Target. We intend to negotiate and consummate a business combination with the Target, but we are not able to assure you whether we will complete a business combination with the Target or more businesses (a “Business Combination”).with any other target business. We also have neither engaged in any operations nor generated any revenue to date. Based on our business activities, the Company is a “shell company” as defined under the Exchange Act because we have no operations and nominal assets consisting almost entirely of cash.
On December 11, 2020, we consummated our initial public offering (“IPO”) on December 11, 2020 and are currently in the process of locating suitable targets for our Business Combination. We intend to use the cash proceeds from our IPO and the Private Placement described below as well as additional issuances, if any, of our capital stock, debt or a combination of cash, stock and debt to complete the Business Combination.
We expect to incur significant costs in the pursuit of our initial Business Combination. We cannot assure you that our plans to raise capital or to complete our initial Business Combination will be successful.
We completed the sale of 30,000,000 units, (the “Units”), with each Unit comprisedincluding 3,900,000 units issued to the underwriters based on a partial exercise of their over-allotment option. Each unit consists of one share of Class A common stock (the “Public Shares”) and one-half of one redeemable warrant, (the “Public Warrants”), includingwith each whole warrant entitling the issuanceholder thereof to purchase one share of 3,900,000 Units asClass A common stock for $11.50 per share. The units were sold at a resultprice of the partial exercise of the underwriters’ over-allotment option, at $10.00 per Unitunit, generating gross proceeds of $300,000,000. Simultaneous$300 million. Simultaneously with the closingconsummation of the IPO,initial public offering, we completed the saleprivate placement of an aggregate of 8,000,000 warrants (the “Private Warrants”)to the Sponsor at a purchase price of $1.00 per Private Warrant in a private placement to Altitude Acquisition Holdco, LLC (our “Sponsor”),warrant, generating gross proceeds of $8 million. Prior to the consummation of the initial public offering, on August 12, 2020, we issued an aggregate of 8,625,000 shares of our Class B common stock (“Founder Shares”) to our Sponsor for an aggregate purchase price of $25,000 in cash. On November 30, 2020, our Sponsor surrendered an aggregate of 1,437,500 Founder Shares to us for no consideration, resulting in our Sponsor holding an aggregate of 7,503,750 Founder Shares. On December 11, 2020 the underwriters partially exercised their over-allotment option, and as a result, 975,000 Founder Shares were no longer subject to forfeiture and 3,750 Founder Shares were forfeited for no consideration. Accordingly, this resulted in our Sponsor holding an aggregate of 7,500,000 Founder Shares.
A total of $300,000,000, comprised of $292,000,000 of the proceeds from the initial public offering (which amount includes $10,500,000 of the underwriters’ deferred discount) and $8,000,000 (the “Private Placement”).of the proceeds of the sale of the private placement warrants, was placed in a U.S.-based trust account at J.P. Morgan Chase Bank, N.A., maintained by CST, acting as trustee.
On December 5, 2022, in order to mitigate the risk of being deemed an unregistered investment company, we instructed CST to liquidate the securities held in the Trust Account and instead hold all funds in the Trust Account in an interest-bearing bank deposit account. As a result, following such change, we will likely receive minimal, if any, interest, on the funds held in the Trust Account.
As of March 31, 2023 and December 31, 2022, there was $16,851,596 and $16,975,796 in cash held in the Trust Account.
On June 10, 2022, we held a special meeting of stockholders. At the special meeting, the Company’s stockholders approved an amendment to the Company’s Amended and Restated Certificate of IncorporationCharter to extend the Combination Perioddate by which the Company must complete its initial business combination from June 11, 2022 to October 11, 2022. In connection with the amendment to the Company’s Amended and Restated Certificate of Incorporation,extension, stockholders holding an aggregate of 24,944,949 shares of our Class A common stockPublic Shares exercised their right to redeem their shares for approximately $10.01 per share of the funds held in ourthe Trust Account, (as defined below), or a total amount of $249,614,847. Following such redemptions, there were 5,055,051 public shares outstanding and an aggregate ofleaving approximately $50.6 million of$50,600,000 in cash held in the Company’s Trust Account.Account after satisfaction of such redemptions.
In connection with the stockholder vote to approve an amendmentPrior to the Company’s Amended and Restated Certificate of Incorporation to extend the Combination Period,June special meeting, on June 7,9, 2022, and June 10, 2022, the Company and Gary Teplis, the Company’s Chief Executive Officer,we entered into non-redemptionnon redemption agreements (collectively, the(“June “Non-Redemption Agreements”) with certain Companyof our existing stockholders (the(“June “Non-Redeeming Stockholders”) holding an aggregate of approximately 1.4 million1,250,000 shares of Class A common stock. Pursuant to the June Non-Redemption Agreements, the June Non-Redeeming Stockholders agreed to (a) not redeem any shares of Class A common stock held by them on the date of the Non-Redemption Agreements in connection with the vote to approve the extension, to the Combination Period, (b) vote all of suchtheir shares in favor of the extension to the Combination Period and any initial business combination presented by the Company for approval by its stockholders, and (c) not Transfer (as such term is defined in the June Non-Redemption Agreements) any of suchtheir shares until the earlier of the October 11, 2022 and consummation of the Company’s initial business combination (the “Termination Date”). combination.
In connection with the June Non-Redemption Agreements, Mr.Gary Teplis, the Chief Executive Officer of the Company, agreed to pay to each June Non-Redeeming Stockholder $0.033 per share subject to the Non-Redemption Agreement in cash per month through the Termination Date.
On June 16,October 11, 2022, pursuant to the trust agreement datedand as a result Gary Teplis contributed a total of December 8, 2020 between the Company and Continental Stock Transfer & Trust Company (“CST”), the trustee$184,929 as part of the Trust Account, the Company issued a request to CST to withdraw $81,200 of interest income from the Trust Account for the payment of the Company’s taxes.executed June Non-Redemption Agreements.
On October 5, 2022, the Company” entered into a non-redemption agreement (the “Non-Redemption Agreement”) with one of its existing stockholders (the “Non-Redeeming Stockholder”) holding an aggregate of 223,124 shares of Class A common stock, par value $0.0001, of the Company.
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On October 6, 2022, we held a special meeting of stockholders. At the special meeting, the Company’s stockholders approved ana second amendment to the Company’s Amended and Restated Certificate of IncorporationCharter to extend the Combination Perioddate by which the Company must complete a business combination from October 11, 2022 to April 11, 2023. In connection with the amendment to the Company’s Amended and Restated Certificate of Incorporation,special meeting, stockholders holding an aggregate of 3,382,949 shares of the Company’s Class A common stockPublic Shares exercised their right to redeem their shares for approximately $10.05 per share of the funds held in the Company’s trust account totaling $34,009,688.
On October 11, 2022, pursuant to the trust agreement dated as of December 8, 2020 between the Company and CST, the trustee ofTrust Account, leaving approximately $16,810,087 in cash in the Trust Account after satisfaction of such redemptions.
Prior to the October special meeting, on October 5, 2022, we entered into a non-redemption agreement (“October Non-Redemption Agreement”) with one of our existing stockholders (“October Non-Redeeming Stockholder”) holding an aggregate of 223,124 shares of Class A common stock. Pursuant to the October Non-Redemption Agreement, the October Non-Redeeming Stockholder agreed to (a) not redeem the shares in connection with the extension and (b) vote all of its shares in favor of the extension.
In connection with the October Non-Redemption Agreement, Gary Teplis, the Chief Executive Officer of the Company, issuedagreed to pay to the October Non-Redeeming Stockholder $0.05 per share per month through April 11, 2023, in a request to CST to withdraw $81,200 of interest incomesingle cash payment within 45 days from the Trust Account for the paymentdate of the Company’s taxes.October Non-Redemption Agreement and as a result Gary Teplis contributed a total $66,937 as part of the executed October Non-Redemption Agreement.
As of September 30,March 31, 2023 and December 31, 2022, a total of $50,865,089$16,851,596 and $16,975,796 was held in the trust account established for the benefit of our public stockholders (the “Trust Account”).Trust Account. The Trust Account is investedheld in an interest-bearing U.S. government securitiesbank deposit account and the income earned on those investmentsthe deposit account is also for the benefit of our public stockholders.
Our management has broad discretion with respect to the specific application of the net proceeds of the IPOinitial public offering and the private placement,Private Placement, although substantially all of the net proceeds are intended to be applied generally towards consummating a business combination.
Charter Amendment
On April 7, 2023, the Company held an annual meeting of stockholders (the “Annual Meeting”), the Company’s stockholders approved a third amendment to the Company’s Charter (the “Charter Amendment”) to give the Board the right to extend the Combination Period, without further stockholder vote, monthly, up to eight times for an additional one month each time, from April 11, 2023 up to December 11, 2023 (the “Extension Amendment”). Additionally, the Company’s stockholders approved amendments to the Charter to provide for a right of a holder of Class B common stock of the Company, par value $0.001 per share to convert its shares of Class B common stock into shares of Class A common stock of the Company, par value $0.001 per share, on a one-to-one basis at any time and from time to time at the election of the holder (the “Founder Share Amendment”) and to delete the limitation that the Company shall not consummate a Business Combination.Combination if it would cause the Company’s net tangible assets to be less than $5,000,0001 following such redemptions and the limitation that the Company shall not redeem Public Shares that would cause the Company’s net tangible assets to be less than $5,000,001 following such redemptions. (the “Redemption Limitation Amendment”). The Company’s stockholders also re-elected Hilton Sturisky as a Class I director for a three year term.
In connection with the extension of the Combination Period stockholders holding an aggregate of 337,457 Public Shares exercised their right to redeem their shares for approximately $10.08 per share of the funds held in the Trust Account, leaving approximately $13,460,673.61 in cash in the Trust Account after satisfaction of such redemptions.
On April 7, 2023, pursuant to the terms of the Charter, Altitude Acquisition Holdco LLC (“Sponsor”), the holder of an aggregate of 7,500,000 shares of Class B common stock, elected to convert each outstanding share of Class B common stock held by it on a one-for-one basis into shares of Class A common stock, with immediate effect. Following such conversion, as of April 7, 2023, the Company had an aggregate of 8,834,645 shares of Class A common stock issued and outstanding and 0 shares of Class B common stock issued and outstanding.
Business Combination Agreement
On April 23, 2023, the Company, entered into a business combination agreement the “Business Combination Agreement” by and among the Company, Altitude Merger Sub I, Inc., a Delaware corporation and a direct, wholly owned subsidiary of Altitude (“Merger Sub”), Altitude Merger Sub II, LLC a Delaware limited liability company and a direct wholly owned subsidiary of Altitude (“Merger Sub II” and together with Merger Sub, the “Merger Subs”) Picard Medical, Inc., a Delaware corporation (“Picard”) and Hunniwell Picard I, LLC, solely in its capacity as the representative, agent and attorney-in-fact of the security holders of Picard. The Business Combination Agreement provides, among other things, that on the terms and subject to the conditions set forth therein, Merger Sub will merge with and into Picard (the “First Merger”), with Picard surviving as a wholly-owned subsidiary of the Company (the “Surviving Corporation”). Immediately following the First Merger and as part of the same overall transaction as the First Merger, the Surviving Corporation will merge with and Merger Sub II, with Merger Sub II surviving as the surviving entity (the “Surviving Entity”, and such merger, the “Second Merger” and, together with the First Merger, the “Mergers”). Upon the closing of the Mergers (the “Closing”), it is anticipated that the Company will change its name to “Picard Medical Holdings, Inc.” and is referred to herein as “New Picard” as of the time following such change of name. The date on which the Closing actually occurs is hereinafter referred to as the “Closing Date.”
Prior to the First Merger, each issued and outstanding share of Picard’s preferred stock, par value $0.0001 per share (“Picard Preferred Stock”), shall automatically convert into one (1) share of common stock of the Picard, par value $0.001 per share (“Picard Common Stock”). Each of Picard’s convertible notes that are outstanding prior to the First Merger, if any, will convert prior to the First Merger into shares of Picard Common Stock in accordance with the terms of such convertible notes. Each share of Picard Common Stock held by a Picard securityholder immediately prior to the First Effective Time (including shares issued upon conversion of Picard Preferred Stock and convertible notes, but not including dissenting shares) shall be automatically cancelled and converted into the right to receive a pro rata portion of an aggregate of 48,000,000 shares of common stock of New Picard, par value $0.001 per share (“New Picard Common Stock”), and an aggregate of 6,500,000 warrants to purchase shares of New Picard Common Stock at an initial exercise price of $11.50 per share (“New Picard Warrants”), plus up to an additional 6,500,000 New Picard Warrants if certain earnout conditions are satisfied (the “Earnout Warrants”). Each of Picard’s options that are outstanding and unexercised prior to the First Merger will be
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Pursuantassumed by New Picard and converted into a New Picard option with the same terms and conditions. Each of Picard’s warrants that are outstanding and unexercised prior to the Non-RedemptionFirst Merger, whether or not then vested or exercisable, will be assumed by New Picard and will be converted into a warrant to acquire shares of New Picard Common Stock and will be subject to the same terms and conditions that applied to the Picard warrant immediately prior to the First Merger.
The Earnout Warrants will be held in escrow following the Closing and will be released to the Picard securityholders if, at any time during the five (5) year period following the Closing, the dollar volume-weighted average price (“VWAP”) of New Picard Common Stock for any 20 trading days within any 30 trading day period is greater than $12.50.
At the Closing, New Picard will issue 100,000 shares of New Picard Common Stock and 30,000 New Picard Warrants to certain service providers of Altitude.
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The Board of the Company has unanimously approved and declared advisable the Business Combination Agreement and the Non-Redeeming StockholderMergers and resolved to recommend approval of the Business Combination Agreement and related matters by the Company’s stockholders. The Closing is expected to occur in the second half of 2023, following the receipt of required approval by the stockholders of the Company and Picard, required regulatory approvals, the effectiveness of the registration statement on Form S-4 agreed(“Registration Statement”) to (a) not redeembe filed with the SharesU.S. Securities and Exchange Commission (“SEC”) in connection with the Mergers and the fulfilment of other conditions set forth in the Business Combination Agreement.
Sponsor Support Agreement
In connection with the execution of the Business Combination Agreement, on April 23, 2023, the Sponsor entered into a support agreement with the Company and Picard (the “Sponsor Support Agreement”). Under the Sponsor Support Agreement, Sponsor agreed to vote, to amendat any meeting of the Company’sstockholders of the Company, and in any action by written consent of the stockholders of the Company, all of the common stock of the Company held by the Sponsor in favor of (i) the approval and adoption of the Mergers,; (ii) adoption and approval of the an amended and restated certificate of incorporation of New Picard (the “New Picard Certificate of Incorporation”), in a form to extendbe mutually agreed to by the dateCompany and Picard, which shall provide for, among other things, the change of the name of the Company to “Picard Medical Holdings, Inc.”; (iii) approval of New Picard’s equity incentive plan; (iv) approval of the issuance of shares under applicable Nasdaq listing rules; (v) approval to adjourn the Company’s stockholder meeting, if necessary; and (vi) approval to obtain any and all other approvals necessary or advisable to effect the consummation of the Mergers as determined by the company (the proposals set forth in the forgoing clauses (i) through (vi) collectively, the “Company Proposals”); and (vii) in favor of any other matter reasonably necessary to the consummation of the transactions contemplated by the Business Combination Agreement and the approval of the Company Proposals. In addition, the Sponsor Support Agreement prohibits the Sponsor from, among other things, selling, assigning or transferring or redeeming any Class A common stock held by it. In addition, the Sponsor Support Agreement provides that the Sponsor will, in connection with the Closing (x) forfeit an aggregate amount of up to 4,500,000 shares of Class A common stock held by the Sponsor immediately prior to the Closing, with such number of forfeited shares to be reduced by 20,000 shares for each $1,000,000 by which the proceeds of the Closing Offering (as defined in the Business Combination Agreement) plus the funds remaining in the Company’s Trust Account (after giving effect to redemptions and any financial incentives or discounts given to incentivize non-redemption and the repayment of any outstanding debt to the Sponsor) together with the proceeds from any Picard Financing, exceeds $38,000,000, (y) forfeit 6,500,000 warrants of the Company, has to consummateeach whole warrant exercisable for one Company Class A Share at an initial business combination from October 11, 2022exercise price of $11.50 per share (the “Company Warrants”) held by Sponsor immediately prior to April 11, 2023the Closing, and (b) vote all(z) deposit with Continental Stock Transfer & Trust Company, acting as escrow agent, 1,250,000 shares of itsClass A common stock (the “Sponsor Earnout Shares”) and 1,000,000 Company Warrants (the “Sponsor Earnout Warrants” and together with the Sponsor Earnout Shares, in favorthe “Sponsor Earnout Securities”). The Sponsor Earnout Securities will be released to the Sponsor upon achievement of the Extension. following milestones at any time during the five year period following the Closing: (i) 500,000 Sponsor Earnout Shares will be released if the VWAP of New Picard Common Stock is equal to or greater than $12.50 for any 20 trading days within any 30 trading day period, (ii) 250,000 Sponsor Earnout Shares and 1,000,000 Earnout Warrants will be released upon the closing of the acquisition by the Company or New Picard, as applicable, of at least 10,000,000 Company Warrants or New Picard Warrants, as applicable, from public investors, and (iii) 750,000 Sponsor Earnout Shares will be released upon the release of the Sponsor Earnout Shares and Sponsor Earnout Warrants pursuant to both (i) and (ii) of this paragraph. Any Sponsor Earnout Securities that have not been released from escrow on the date that is five years after the Closing shall be forfeited.
Picard Support Agreements
In connection with the foregoing, Gary Teplis, the Chief Executive Officerexecution of the Business Combination Agreement, on April 23, 2023, certain Picard stockholders holding an aggregate of approximately 90% of the outstanding Picard equity, on an as-converted to Picard Common Stock basis, and 100% of the outstanding Picard Preferred Stock (together, the “Picard Supporting Stockholders”) entered into support agreements with the Company and Picard (the “Picard Support Agreements”). Under the Picard Support Agreements, each Picard Supporting Stockholder agreed that, following the SEC declaring effective the Registration Statement, to payexecute and deliver a written consent with respect to the outstanding shares of Picard Common Stock and Picard Preferred Stock held by such Picard Supporting Stockholder (the “Subject Picard Shares”) approving the Business Combination Agreement and the transactions contemplated thereby. In addition to the foregoing, each Picard Supporting Stockholder agreed that at any meeting of the holders of Picard capital stock, each such Picard Supporting Stockholder will appear at the meeting, in person or by proxy, and cause its Subject Picard Shares to be voted (i) to approve and adopt the Business Combination Agreement and the transactions contemplated thereby, including the Mergers; (ii) against any (A) any merger, consolidation, share exchange, business combination or other similar transaction or (B) any sale, lease, exchange, transfer or other disposition of all or a material portion of the assets of Picard (a “Alternative Proposal”); and (iii) against any amendment of the certificate of incorporation, or bylaws of Picard or proposal or transaction that would impede or frustrate the provisions of the Picard Support Agreements, the Business Combination Agreement or the transactions contemplated thereby. In addition, the Picard Support Agreements prohibit the Picard Supporting Stockholders from, among other things, (i) transferring any of the Subject Picard Shares; (ii) entering into (a) any option, warrant, purchase right, or other contact that would require the Picard Support Stockholders to transfer the Subject Picard Shares, or (b) any voting trust, proxy or other contract with respect to the voting or transfer of the Subject Picard Shares; or (iii) or taking any action in furtherance of the forgoing.
The Picard Support Agreement provides that the Picard Supporting Stockholders will not directly or indirectly, (i) solicit, initiate or knowingly encourage or facilitate any inquiry, proposal, or offer which constitutes, or could reasonably be expected to lead to, an Alternative Proposal in their capacity as such, (ii) participate in any discussions or negotiations regarding, or furnish or receive any nonpublic information relating to the Picard or its subsidiaries, in connection with any Alternative Proposal, (iii) approve or recommend, or make any public statement approving or recommending an Alternative Proposal, (iv) enter into any letter of intent, merger agreement or similar agreement providing for an Alternative Proposal, (v) make, or in any manner participate in a “solicitation” (as such term is used in the rules of the SEC) of proxies or powers of attorney or similar rights to vote, or seek to advise or influence with respect to voting of the Picard capital stock intending to facilitate any Alternative Proposal or cause any holder of shares of Picard capital stock not to vote to adopt the Business Combination Agreement and approve the Mergers and the other transactions contemplated thereby, (vi) become a member of a “group” (as such term is defined in Section 13(d) of the Exchange Act) with respect to any voting securities of Picard that takes any action in support of an Alternative Proposal or (vii) otherwise resolve or agree to do any of the foregoing.
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Picard’s Supporting Stockholders each also irrevocably waived, and agreed not to exercise or assert, any dissenters’ or appraisal rights under Delaware law in connection with the Mergers and the Business Combination Agreement.
Other Agreements
The Business Combination Agreement contemplates the execution of various additional agreements and instruments, on or before the Closing, including, among others, the agreements described below.
Registration Rights Agreement
In connection with the Closing, the Company, Picard, and certain of their respective stockholders will enter into an amended and restated registration rights agreement (the “Registration Rights Agreement”). Pursuant to the Registration Rights Agreement, New Picard will be required to register for resale securities held by the stockholders party thereto. In addition, the holders will have certain demand and “piggyback” registration rights. New Picard will bear the expenses incurred in connection with the filing of any registration statements pursuant to the Registration Rights Agreement.
Lock-Up Agreement
In connection with the Closing, the Company and certain record and/or beneficial owner of equity securities of Picard (“Holders”) will enter into a lock-up agreement (the “Lock-Up Agreement”). Pursuant to the Non-Redeeming StockholderLock-Up Agreement, $0.05 per Share per month through the Extended Date,Holders will agree, subject to customary exceptions, not to transfer (a) any shares of New Picard Common Stock received by them as consideration in a single cash payment within 45 days fromthe Mergers (the “Lock-Up Shares”) for the period ending on the earliest of (x) the date this is one (1) year following the Closing Date, (y) the date on which the closing price of shares of New Picard Common Stock on Nasdaq equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the Non-Redemption Agreement.like) for twenty (20) of any thirty (30) consecutive trading days commencing at least 150 days after the Closing, and (z) the date on which New Picard completes a liquidation, merger, capital stock exchange, reorganization or similar transaction that results in all of New Picard’s stockholders having the right to exchange their shares of New Picard Common Stock for cash, securities or other property and (b) any warrants of received as consideration in the Mergers (including the Earnout Warrants) for a period of 30 days after Closing.
Nasdaq Deficiency Notice
On January 9, 2023, the Company received a deficiency notice from Nasdaq indicating that the Company failed to hold an annual meeting of stockholders within 12 months after its fiscal year ended December 31, 2021, as required by Nasdaq Listing Rule 5620(a). The Company submitted a plan to regain compliance and Nasdaq granted the Company until April 11, 2023, its then-current liquidation date, to regain compliance. The Company held its Annual Meeting on April 7, 2023 and accordingly regained compliance with Nasdaq Listing Rule 5620(a).
Results of Operations
As of September 30, 2022,March 31, 2023, we have not commenced any operations. All activity for the period from August 12, 2020 (inception) through September 30, 2022March 31, 2023, relates to our formation and IPO,initial public offering, and, since the completion of the IPO, our searching for a target to consummate a Business Combination.business combination. We will not generate any operating revenues until after the completion of a Business Combination,business combination, at the earliest. We generate non-operating income in the form of interest income from the proceeds derived from the IPO and placedon cash deposits in the Trust Account. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.
For the three months ended September 30,March 31, 2023, we had a net loss of $1,448,735 which included operating costs of $1,619,190, partially offset by unrealized gain on change in fair value of warrants of $170,435 and interest income earned on the operating bank account of $20.
For the three months ended March 31, 2022, we had a net income of $1,158,637$8,617,191 which included unrealized gain on change in fair value of warrants of $1,389,550,$9,537,808, interest income earned on the proceeds in the Trust Account of $222,471$7,600 and interest income earned on the operating bank account of $1, partially offset by operating costs of $439,362$928,218.
Liquidity and income tax provisionCapital Resources
As of $14,023.
For the nine months ended September 30, 2022,March 31, 2023, we had cash outside our Trust Account of $31,467 available for working capital needs. All remaining cash was held in the Trust Account and is generally unavailable for our use prior to an initial business combination.
On December 11, 2020, we consummated the IPO of 30,000,000 Units, at $10.00 per Unit, generating gross proceeds of $300,000,000.
Simultaneously with the closing of the IPO, we consummated the sale of 8,000,000 warrants, at a net incomeprice of $9,540,916 which included unrealized gain on change$1.00 per Private Warrant, generating gross proceeds of $8,000,000.
In connection with the IPO, the underwriters were granted a 45-day option from the date of the prospectus to purchase up to 3,915,000 additional Units to cover over-allotments, if any. On December 11, 2020, the underwriters partially exercised their Over-Allotment Option and purchased an additional 3,900,000 Units. The unexercised portion of the over-allotment option was forfeited.
Following our IPO and the sale of the Private Warrants, a total of $300,000,000 ($10.00 per Unit) was placed in fair valuethe Trust Account. We incurred $17,107,057 in IPO related costs, including $6,000,000 of warrantsunderwriting fees, $10,500,000 of $11,915,139, interest income earned on the proceedsdeferred underwriting discount and $607,057 of other costs.
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As of March 31, 2023, we had investments held in the Trust Account of $534,340 and$16,851,596 (including approximately $130,576 of interest available). Interest income earned on the operating bank account of $2, partially offsetbalance in the Trust Account may be used by operating costs of $2,885,762 and income tax provision of $22,803.us to pay taxes.
For the three months ended September 30, 2021, we had a netMarch 31, 2023, cash used by operating activities was $228,493. Net loss of $569,008 which included operating costs of $4,903,000, partially offset$1,448,735 was impacted by unrealized gain on change in fair value of warrants of $4,327,824,$170,435, and changes in operating assets and liabilities, which provided $1,390,677 of cash for operating activities.
For the three months ended March 31, 2022, cash used in operating activities was $20,083. Net income of $8,617,191 was impacted by interest income earned on the proceeds in the Trust Account of $6,165 and interest income earned on the operating bank account of $3.
For the nine months ended September 30, 2021, we had a net income of $12,043,581 which included$7,600, unrealized gain on change in fair value of warrants of $17,773,513, interest income earned on the proceeds in the Trust Account of $19,240 and interest income earned on the operating bank account of $23, partially offset by operating costs of $5,749,195.
Liquidity and Capital Resources
As of September 30, 2022, we had cash outside our Trust Account of $24,338 available for working capital needs.
In connection with the stockholder vote to amend the Company’s Amended and Restated Certificate of Incorporation, on June 14, 2022, stockholders holding an aggregate of 24,944,949 shares of our Class A common stock exercised their right to redeem their shares for approximately $10.01 per share of the funds held in our Trust Account, totaling $249,614,847.
On June 16, 2022, pursuant to the trust agreement dated as of December 8, 2020 between the Company and CST, the Company issued a request to CST to withdraw $81,200 of interest income from the Trust Account for the payment of the Company’s taxes.
As of September 30, 2022, we had investments held in the Trust Account of $50,865,089, consisting of mutual funds comprised of U.S. Treasury Bills.
For the nine months ended September 30, 2022, cash used by operating activities was $99,916. Net income of $9,540,916 was impacted by interest income earned on Trust of $534,340, unrealized gain on change in fair value of warrants of $11,915,139,$9,537,808, and changes in operating assets and liabilities, which provided $2,808,647 of cash for operating activities.
For the nine months ended September 30, 2021, cash used in operating activities was $630,274. Net income of $12,043,581 was impacted by interest earned on investments held in the Trust Account of $19,240, change in fair value of warrant liability of $17,773,513, and changes in operating assets and liabilities, which provided $5,118,898$908,134 of cash for operating activities.
We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account (excluding the deferred underwriters’ discount) to complete our initial Business Combination.business combination. We may withdraw interest to pay our taxes and liquidation expenses if we are unsuccessful in completing a Business Combination.business combination. We estimate our annual franchise tax obligations to be $200,000,$185,600, which is the maximum amount of annual franchise taxes payable by us as a Delaware corporation per annum, which we may pay from funds from the IPOinitial public offering held outside of the Trust Account or from interest earned on the funds held in the Trust Account and released to us for this purpose. Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the trust accountTrust Account reduced by our operating expense and franchise taxes. We expect the interest earned on the amount in the trust accountTrust Account will be sufficient to pay our income taxes. To the extent that our equity or debt is used, in whole or in part, as consideration to complete our initial Business Combination,business combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
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On June 2, 2021, we issued an unsecured promissory note to the Sponsor for an aggregate available principal amount of $300,000 to be used for a portion of the expenses of the Business Combination. This loan is non-interest bearing, unsecured and due at the earlier of December 31, 2021 or the closing of the Business Combination. We had no borrowings under the promissory note.
Further, our Sponsor, officers and directors or their respective affiliates may, but are not obligated to, loan us funds as may be required (the “Working Capital Loans”). If we complete a Business Combination, we will repay the Working Capital Loans. In the event that a Business Combination does not close, we may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Such Working Capital Loans would be evidenced by promissory notes. The notes would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion. As of September 30, 2022March 31, 2023 and December 31, 2021,2022, no Working Capital Loans have been issued.
On November 16, 2021, January 18, 2022, February 1, 2022, April 25, 2022, May 2, 2022, May 13, 2022, June 3, 2022, June 6, 2022, and June 16, 2022, we received $100,000, $100,000, $250,000, $50,000, $100,000, $20,000, $25,000, $177,423 and $66,000 advances from our Sponsor or its affiliates to be used for working capital purposes, respectively. The advances are non-interest bearing and due on demand. As of September 30, 2022At March 31, 2023 and December 31, 2021, we2022, the Company owed the Sponsor or its affiliates $888,423$869,044 and $100,000$802,644 related to these advances, respectively.
We have incurred and expect to continue to incur significant costs in pursuit of our acquisition plans. We Although management expects that it will needbe able to raise additional capital through loansto support its planned activities and complete a business combination on or additional investments from our Sponsor, stockholders, officers, directors, or third parties. Our officers, directors and Sponsorprior to April 11, 2023 (which date may but are not obligatedbe extended by the Board monthly up to loan us funds, from time to time or at any time,December 11, 2023 in whatever amount they deem reasonable in their sole discretion, to meet our working capital needs. Accordingly, we may notconnection with the Monthly Extension), it is uncertain whether it will be able to do so. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our business combination. Moreover, we may need to obtain additional financing.
In addition,financing either to complete our business combination or because we have until April 11, 2023become obligated to consummateredeem a Business Combination.significant number of our Public Shares upon consummation of our business combination, in which case we may issue additional securities or incur debt in connection with such business combination. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our business combination. If we are unable to complete a Business Combination priorour business combination because we do not have sufficient funds available to April 11, 2023,us, we will redeem 100% of the outstanding public shares for a pro rata portion of the funds held inbe forced to cease operations and liquidate the Trust Account, equalAccount. In addition, following our business combination, if cash on hand is insufficient, we may need to the aggregate amount then on depositobtain additional financing in the Trust Account including interest earned on the funds held in the Trust Account and not previously releasedorder to us to paymeet our franchise and income taxes, divided by the number of then outstanding public shares, subject to applicable law and as further described in registration statement, and then seek to dissolve and liquidate.
As a result of the above, in connection with our 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 determined that these conditions raise substantial doubt about our ability to continue as a going concern through April 11, 2023, the scheduled liquidation date. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should us be unable to continue as a going concern.obligations.
Off-Balance Sheet Financing Arrangements
We did not have any off-balance sheet arrangement as of September 30, 2022.March 31, 2023.
Contractual Obligations
As of September 30, 2022,March 31, 2023, we did not have any long-term debt, capital or operating lease obligations. We entered into an administrative services agreement pursuant
The Company agreed, commencing on the date that the securities of the Company were first listed on The Nasdaq Capital Market (the “Listing Date”), to which we will pay an affiliate of onethe Company’s Sponsor a monthly fee of our directorsan aggregate of $10,000 for office space, utilities and secretarial and administrative services provided to members of our management team, in an amount not to exceed $10,000 per month. We have incurred $30,000 and $90,000 of administrative service fees for three and nine months ended September 30, 2022, respectively. The paymentsupport. Upon completion of the Company’s initial Business Combination or its liquidation, the Company will cease paying these monthly fees. During the quarter of March 31, 2023, the Sponsor agreed to waive the company’s payment obligation under the administrative service fee was suspended starting in May 2022.
For the threesupport agreement and nine months ended September 30, 2021, we have incurred 30,000 and $90,000therefore has recognized contribution from Sponsor of administrative service fees, respectively.$247,667.
Critical Accounting PoliciesEstimates
The preparation of condensed consolidated financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following as our critical accounting policies:estimates:
Use of Estimates
The preparation of the condensed consolidated financial statements in conformity with 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 revenues and expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. The warrants liabilities are the Company’s most significant estimate. Accordingly, the actual results could differ significantly from those estimates.
Derivative Financial Instruments
We evaluate our 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 recorded at fair value on the grant date and re-valued at each reporting date, with changes in the fair value reported in the statements of operations. Derivative assets and liabilities are classified on 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. We have determined the warrants are a derivative instrument.
FASB ASC 470-20, Debt with Conversion and Other Options addresses the allocation of proceeds from the issuance of convertible debt into its equity and debt components. We apply this guidance to allocate IPO proceeds from the Units between Class A common stock and warrants, using the residual method by allocating IPO proceeds first to fair value of the warrants and then the Class A common stock.
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Class A Common Stock Subject to Possible Redemption
We account for our Class A common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption (if any) is classified as liability instruments and is measured at fair value. Conditionally redeemable Class A common stock (including common stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. Our Class A common stock features certain redemption rights that are considered to be outside of our control and subject to the occurrence of uncertain future events. Accordingly, at September 30, 2022March 31, 2023 and December 31, 2021, 5,055,051 and 30,000,0002022, 1,672,102 shares of Class A common stock subject to possible redemption are presented as temporary equity, outside of the stockholders’ deficit section of our consolidated balance sheets, respectively.
Net (Loss) Income (loss) Per Share of Common Stock
We have 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 common stock. The 23,000,000 shares of Class A common stock potentially issuable upon the exercise of outstanding warrants to purchase Class A common stock were excluded from diluted earnings per share for the three and nine months ended September 30,March 31, 2023 and 2022 and 2021 because the warrants are contingently exercisable, and the contingencies have not yet been met. As a result, diluted net (loss) income (loss) per share of common stock is the same as basic net (loss) income (loss) per share of common stock for the periods presented.
Recent Accounting Standards
In August 2020, the FASB issued 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): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. The ASU also removes certain settlement conditions that are required for equity-linked contracts to qualify for scope exception, and it simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective January 1, 2024 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. We are currently assessing the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows.
Management does not believe that any other recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on our condensed consolidated financial statements.
JOBS Act
The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an “emerging growth company” under the JOBS Act and are allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electinghave elected not to delayopt 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, we, as an emerging growth company, can adopt the adoption of new or revised accounting standards, and as a result, we may not comply withstandard at the time private companies adopt the new or revised standard. This may make comparison of our 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 on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.used.. Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subjectsubject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an independent registered public accounting firm’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the independent registered public accounting firm’s report providing additional information about the audit and the consolidated financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.
These exemptions will apply for a period of five years following the completion of this offering or until we are no longer an “emerging growth company,” whichever is earlier.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
Item 4. Controls and Procedures.
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Evaluation of Disclosure Controls and Procedures
As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2022.March 31, 2023. Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15 (e) and 15d-15 (e) under the Exchange Act) were effective.
Changes in Internal Control over Financial Reporting
During the most recently completed fiscal quarter, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 1A. Risk Factors.
There are certain risks and uncertainties in our business that could cause our actual results to differ materially from those anticipated. A detailed discussion of our risk factors was included in Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2021,2022, filed with the SEC on March 9, 2022.23, 2023. These risk factors should be read carefully in connection with evaluating our business and in connection with the forward-looking statements and other information contained in this Quarterly Report. Any of the risks described in the Annual Report on Form 10-K for the year ended December 31, 2021,2022, could materially affect our business, financial condition or future results and the actual outcome of matters as to which forward-looking statements are made. There have been no material changes to the risk factors set forth in the Annual Report on Form 10-K for the year ended December 31, 2021 except for the following:
A new 1% U.S. federal excise tax could be imposed on us in connection with redemptions by us of our shares.
On August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022 (the “IR Act”), which, among other things, imposes a 1% excise tax on the fair market value of stock repurchased by “covered corporations” beginning in 2023, with certain exceptions (the “Excise Tax”). The Excise Tax is imposed on the repurchasing corporation itself, not its stockholders from which the stock is repurchased. Because we are a Delaware corporation and our securities are trading on Nasdaq, we are a “covered corporation” for this purpose. 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 Treasury has been given authority to provide regulations and other guidance to carry out, and prevent the abuse or avoidance of the Excise Tax; however, no guidance has been issued to date. It is uncertain whether, and/or to what extent, the Excise Tax could apply to any redemptions of our public shares after December 31, 2022, including any redemptions in connection with an initial business combination or in the event we do not consummate an initial business combination by the Extended Date.
Any redemption or other repurchase that we make that occurs after December 31, 2022 may be subject to the excise tax. Whether and to what extent we would be subject to the excise tax would depend on a number of factors, including (i) the fair market value of the redemptions and repurchases in connection with our initial business combination, (ii) the structure of the business combination, (iii) the nature and amount of any “PIPE” or other equity issuances in connection with the business combination (or otherwise issued not in connection with the business combination but issued within the same taxable year of the business combination) and (iv) the content of regulations and other guidance from the U.S. Department of the Treasury. In addition, because the excise tax would be payable by us, 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 limit our ability to complete a business combination.
If we are deemed to be an investment company for purposes of the Investment Company Act, we may be forced to abandon our efforts to complete an initial business combination and instead be required to liquidate the Company. To mitigate the risk of that result, on or prior to the 24-month anniversary of the effective date of the registration statement relating to our IPO, we will instruct Continental Stock Transfer & Trust Company to liquidate the securities held in the trust account and instead hold all funds in the trust account in cash. As a result, following such change, we will likely receive minimal, if any, interest, on the funds held in the trust account, which would reduce the dollar amount that our public stockholders would have otherwise received upon any redemption or liquidation of the Company if the assets in the trust account had remained in U.S. government securities or money market funds.
On March 30, 2022, the SEC issued the SPAC Rule Proposals, relating, among other things, to circumstances in which SPACs such as us could potentially be subject to the Investment Company Act and the regulations thereunder. The SPAC Rule Proposals would provide a safe harbor for such companies from the definition of “investment company” under Section 3(a)(1)(A) of the Investment Company Act, provided that a SPAC satisfies certain criteria. To comply with the duration limitation of the proposed safe harbor, a SPAC would have a limited time period to announce and complete a de-SPAC transaction. Specifically, to comply with the safe harbor, the SPAC Rule Proposals would require a company to file a report on Form 8-K announcing that it has entered into an agreement with a target company for an initial business combination no later than 18 months after the effective date of the registration statement for its initial public offering. The company would then be required to complete its initial business combination no later than 24 months after the effective date of the registration statement for its initial public offering. We understand that the SEC has recently been taking informal positions regarding the Investment Company Act consistent with the SPAC Rule Proposals.
There is currently uncertainty concerning the applicability of the Investment Company Act to a SPAC, including a company like ours, that does not complete its initial business combination within the proposed time frame set forth in the proposed safe harbor rule. As indicated above, we completed our IPO in December 2020 and have operated as a blank check company searching for a target business with which to consummate an initial business combination since such time (or approximately 19 months after the effective date of our IPO, as of the date of this proxy statement). As a result, it is possible that a claim could be made that we have been operating as an unregistered investment company if the SPAC Rule Proposals are adopted as proposed. If we were deemed to be an investment company for purposes of the Investment Company Act, we might be forced to abandon our efforts to complete an initial business combination and instead be required to liquidate the Company. If we are required to liquidate the Company, our investors would not be able to realize the benefits of owning shares in a successor operating business, including the potential appreciation in the value of our shares and warrants or rights following such a transaction, and our warrants or rights would expire worthless.
The funds in the trust account have, since our IPO, been held only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds investing solely in U.S. government treasury obligations and meeting certain conditions under Rule 2a-7 under the Investment Company Act. As of September 30, 2022, amounts held in trust account included approximately $94,925 of accrued interest. To mitigate the risk of us being deemed to have been operating as an unregistered investment company under the Investment Company Act, we will, on or prior to the 24-month anniversary of the effective2022.
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date of the registration statement relating to our IPO, or December 8, 2022, instruct Continental Stock Transfer & Trust Company, the trustee with respect to the trust account, to liquidate the U.S. government treasury obligations or money market funds held in the trust account and thereafter to hold all funds in the trust account in cash (i.e., in one or more bank accounts) until the earlier of the consummation of a business combination or our liquidation. Following such liquidation of the assets in our trust account, we will likely receive minimal interest, if any, on the funds held in the trust account, which would reduce the dollar amount our public stockholders would have otherwise received upon any redemption or liquidation of the Company if the assets in the trust account had remained in U.S. government securities or money market funds. This means that the amount available for redemption will not increase in the future, and those stockholders who elect not to redeem their public shares in connection with the Extension Amendment will receive no more than the same per share amount, without additional interest, if they redeem their public shares in connection with a business combination or if the Company is liquidated in the future, in each case as compared with the per share amount they would have received if they had redeemed their public shares in connection with the Extension Amendment.
In addition, even prior to the 24-month anniversary of the effective date of the registration statement relating to our IPO, we may be deemed to be an investment company. The longer that the funds in the trust account are held in short-term U.S. government securities or in money market funds invested exclusively in such securities, even prior to the 24-month anniversary, there is a greater risk that we may be considered an unregistered investment company, in which case we may be required to liquidate. Accordingly, we may determine, in our discretion, to liquidate the securities held in the trust account at any time, even prior to the 24-month anniversary, and instead hold all funds in the trust account in cash, which would further reduce the dollar amount our public stockholders would receive upon any redemption or our liquidation.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
On November 10, 2022, Sam Galeotos notified the Company of his decision to resign from his position on the Board of the Company and from the audit committee of the Board, effective immediately. Mr. Galeotos’ decision to resign was due to increasing responsibilities in his other executive roles and was not related to any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.None.
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Item 6. Exhibits.
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.
Exhibit Index
* | Filed herewith |
** | Furnished herewith |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
ALTITUDE ACQUISITION CORP. | ||||||
Date: | By: | /s/Gary Teplis | ||||
Name: Gary Teplis | ||||||
Title: Chief Executive Officer | ||||||
(Principal Executive Officer) | ||||||
Date: | By: | /s/ Farris Griggs | ||||
Name: Farris Griggs | ||||||
Title: Chief Financial Officer | ||||||
(Principal Financial and Accounting Officer) |
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