UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~September 30, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. ~~001-39807~~001-40380

MAQUIA CAPITAL ACQUISITION ~~CORPORATION~~CORP

ORATION

(Exact name of registrant as specified in its charter)

Delaware

85-4283150

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

50 Biscayne Boulevard, Suite 2406

Miami, FL33132

(Address of Principal Executive Offices, including zip code)

(~~305~~305) 608-1395) ~~608-1395~~

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

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	MAQCU	The Nasdaq Stock Market LLC
Class A Common Stock, par value $0.0001 per share	MAQC	The Nasdaq Stock Market LLC
Redeemable Warrants, each whole warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50	MAQCW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

	☐ Large accelerated filer	☐Accelerated filer
	☒ Non-accelerated filer	☒ Smaller reporting company
		☒ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☒ No ☐

As of ~~August 16,~~November 10, 2022, there were ~~17,893,462~~4,123,552 shares of Class A Common Stock, par value $0.0001 per share, and 4,500,528 shares of Class B Common Stock, par value $0.0001 per share, of the registrant issued and outstanding.

~~Table of Contents~~

MAQUIA CAPITAL ACQUISITION CORPORATION

FORM 10-Q FOR THE QUARTER ENDED ~~JUNE~~SEPTEMBER 30, 2022

TABLE OF CONTENTS

			Page
PART 1 – FINANCIAL INFORMATION

Item 1.	Financial Statements		F-1

	Condensed Balance ~~Sheet~~Sheets (unaudited)		F-1

	Condensed Statements of Operations (unaudited)		F-2

	Condensed Statements of Changes in Stockholders’ Equity (Deficit) (unaudited)		F-3

	Condensed Statements of Cash Flows (unaudited)		F-4

	Notes to Condensed Financial Statements (unaudited)		F-5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21	1

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	24	6

Item 4.	Control and Procedures	24	6

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	25	7

Item 1A.	Risk Factors	25	7

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30	8

Item 3.	Defaults Upon Senior Securities	30	8

Item 4.	Mine Safety Disclosures	30	8

Item 5.	Other Information	30	8

Item 6.	Exhibits	31	9

SIGNATURES		32	10

~~Table of Contents~~

Item 1.Financial Statements

MAQUIA CAPITAL ACQUISITION CORPORATION

CONDENSED BALANCE SHEETS

June 30, 2022

December 31, 2021

(unaudited)

ASSETS

Current asset

Cash and cash equivalents

$
52,583

$
475,500
Prepaid expenses

129,050

157,500
Total current assets

181,633

633,000

Other assets

—

50,300
Investments held in the Trust Account

177,740,015

175,719,039
Total Assets

$
177,921,648

$
176,402,339

LIABILITIES AND STOCKHOLDERS’ DEFICIT


Accounts payable and accrued expenses

$
231,832

$
326,436
Note payable – Sponsor at fair value (cost: $1,730,972 and $0)

368,342

—
Total current liabilities

600,174

326,436

Deferred underwriting compensation

5,192,916

5,192,916
Warrant liability - Private Placement Warrants

29,188

182,128
Warrant liability - Public Warrants

865,486

4,317,044
Total liabilities

6,687,764

10,018,524


Commitments and Contingencies (Note 5)


Class A Common Stock subject to possible redemption; 17,309,739 shares at redemption value of $10.25 and $10.15 per share

177,424,608

175,693,636

Stockholders’ Deficit

Preferred stock, $0.0001 par value; 1,000,000 shares authorized; NaN issued and outstanding

—

—
Class A common stock, $0.0001 par value; 100,000,000 shares authorized; 583,723 issued and outstanding (excluding 17,309,739 shares subject to possible redemption)

58

58
Class B common stock, par value $0.0001; 10,000,000 shares authorized; 4,500,528 issued and outstanding

450

450
Accumulated deficit

(6,191,232)

(9,310,329)
Total Stockholders’ Deficit

(6,190,724)

(9,309,821)
Total Liabilities and Stockholders’ Deficit

$
177,921,648

$
176,402,339

	September 30, 2022			December 31, 2021
	(unaudited)
ASSETS
Current asset
Cash and cash equivalents	$	249,357		$	475,500
Prepaid expenses		105,675			157,500
Total current assets		355,032			633,000

Other assets		-			50,300
Investments held in the Trust Account		179,927,820			175,719,039
Total Assets	$	180,282,852		$	176,402,339

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Accounts payable and accrued expenses	$	503,669		$	326,436
Note payable – Sponsor at fair value (cost: $3,461,944 and $0 at September 30, 2022 and December 31, 2021, respectively)		701,974			—
Total current liabilities		1,205,643			326,436

Deferred underwriting compensation		5,192,916			5,192,916
Warrant liability - Private Placement Warrants		8,757			182,128
Warrant liability - Public Warrants		255,318			4,317,044
Total liabilities		6,662,634			10,018,524

Commitments and Contingencies (Note 5)
Class A Common Stock subject to possible redemption; 17,309,719 shares at redemption value of $10.38 and $10.15 per share		179,736,777			175,693,636

Stockholders’ Deficit
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding		-			—
Class A common stock, $0.0001 par value; 100,000,000 shares authorized; 583,743 issued and outstanding (excluding 17,309,719 shares subject to possible redemption)		58			58
Class B common stock, par value $0.0001; 10,000,000 shares authorized; 4,500,528 issued and outstanding		450			450
Accumulated deficit		(6,117,067	)		(9,310,329	)
Total Stockholders’ Deficit		(6,116,559	)		(9,309,821	)
Total Liabilities and Stockholders’ Deficit	$	180,282,852		$	176,402,339

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

F-1

~~F-1~~

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

Maquia Capital Acquisition Corporation (the “Company”) is a blank check company incorporated in the State of Delaware on December 10, 2020. There was no activity from December 10, 2020 through December 31, 2020. The Company was formed for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, entering into contractual arrangements with, or engaging in any other similar business combination with 1one or more businesses or entities (“Business Combination”). Although the Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination, the Company intends to focus on companies in the technology-focused middle market and emerging growth companies in North America.

At ~~June~~September 30, 2022, the Company had not yet commenced any operations. All activity through ~~June~~September 30, 2022 related to the Company’s formation and the Initial Public Offering which was consummated on May 7, 2021 (as defined below) and subsequent to the Initial Public Offering, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after completion of its Initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income or unrealized gains on investments held in the trust account and gains or losses from the change in the fair value of the warrant liabilities. The Company has selected December 31 as its fiscal year end. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.

The Company’s sponsor is Maquia Investment North America LLC, (the “Sponsor”). The registration statement for the Company’s Initial Public Offering was declared effective on May 4, 2021. On May 7, 2021, the Company closed its Initial Public Offering of 16,000,000 units (the “Units”) at $10.00 per Unit, generating gross proceeds of $160 million, and incurring offering costs of approximately $7.0 million, inclusive of $5,192,916 million in deferred underwriting commissions (Note 5). Each Unit consists of 1one share of the Company’s Class A common stock (the “Public Shares”) and ~~one-half~~one-half of one redeemable warrant (each, a “Warrant” and, collectively, the “Warrants”). On May 7, 2021, the Company issued 160,000 shares of Class B common stock to the underwriter for services rendered and recorded $1,209,600 which is recorded as a stock issuance cost.

Simultaneously with the closing of the Initial Public Offering, the Company consummated a private sale (the “Private Placement”) of 551,000 units (each, a “Private Placement Unit” and collectively, the “Private Placement Units”) to the Sponsor at a purchase price of $10.00 per Private Placement Unit, generating gross proceeds of approximately $5,510,000 (Note 4). The Private Placement Units are identical to the Units in the Initial Public Offering, except as otherwise disclosed in the Registration Statement. No underwriting discounts or commissions were paid with respect to such sale.

On May 10, 2021, the Company consummated the closing of the sale of 1,309,719 additional units of the Company’s Class A common stock, $0.0001 par value at a price of $10.00 per unit upon receiving notice of the underwriters’ election to partially exercise their overallotment option (“Over-allotment Units”), generating additional gross proceeds of $13,097,190 and incurred additional offering costs of $130,972 in underwriting fees. Each Over-allotment Unit consists of 1one share of the Company’s Class A common stock, $0.0001 par value, and ~~one-half~~one-half of one warrant (each, an “Over-allotment Warrant” and, collectively, the “Over-allotment Warrants”). Each whole Warrant entitles the holder to purchase 1one Class A common stock at a price of $11.50 per share. Simultaneously with the exercise of the over-allotment, the Company consummated the private placement of an additional 32,743 private placement units (the “Over-allotment Private Placement Units”) to the Sponsor, generating gross proceeds of $327,430. As a result of the underwriters’ election to partially exercise their over-allotment option, 327,430 Founder Shares are no longer subject to forfeiture. The remaining 272,570 Founders shares were forfeited. On May 12, 2021, the Company issued 13,098 shares of Class B common stock to the underwriter for services rendered and recorded $99,021 which is recorded as a stock issuance cost.

~~Table of Contents~~

The Trust Account

Following the closing of the Initial Public Offering in May 2021, $175.7 million of the net proceeds of the sale of the Units, the Private Placement Units, the Over-allotment Units and the Over-allotment Private Placement Units were placed in a trust account (the “Trust Account”) with Continental Stock Transfer & Trust Company. The funds held in the Trust Account will be invested only in U.S. government treasury bills with a maturity of one hundred eighty ~~(180)~~five (185) days or less or in money market funds that meet certain conditions under Rule 2a-7 under the Investment Company Act of 1940 and that invest only in direct U.S. government obligations. Funds will remain in the Trust Account until the earlier of (i) the consummation of the Initial Business Combination or (ii) the distribution of the Trust Account proceeds as described below. The remaining proceeds outside the Trust Account may be used to pay for business, legal and accounting due diligence on prospective acquisitions and continuing general and administrative expenses.

F-5

Except with respect to interest earned on the funds held in the Trust Account that may be released to the Company to pay its taxes and up to $100,000 of interest that may be used for dissolution expenses, the proceeds from the Initial Public Offering and the Private Placement will not be released from the Trust Account until the earlier of: (i) the completion of the Company’s Initial Business Combination; (ii) the redemption of any Public Shares that have been properly tendered in connection with a stockholder vote to amend the Company’s amended and restated certificate of incorporation (A) to modify the substance or timing of the Company’s obligation to redeem 100% of Public Shares if the Company does not complete its Initial Business Combination within 24 months from the closing of the Initial Public Offering ~~(or 30 months from the closing of the Initial Public Offering if the Company has executed~~or such a letter of intent, agreement in principle or definitive agreement for the Initial Business Combination within 24 months from the closing of the Initial Public Offering but has not completed the Initial Business Combination within such 24 month period) (the “Combination Period”)later date pursuant to stockholder approval or (B) with respect to any other provision relating to stockholders’ right ~~for~~or pre-Initial Business Combination activity; and (iii) the redemption of 100% of the Public Shares if the Company is unable to complete an Initial Business Combination within the Combination Period (as defined below), subject to the requirements of applicable law. The proceeds deposited in the Trust Account could become subject to the claims of the Company’s creditors, if any, which could have priority over the claims of the Company’s public stockholders.

Initial Business Combination

The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and sale of the Placement Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. NASDAQ rules provide that the Business Combination must be with 1one or more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (as defined below) (less any deferred underwriting commissions and taxes payable on interest earned and less any interest earned thereon that is released for taxes) at the time of the signing of an agreement to enter into a Business Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”). There is no assurance that the Company will be able to successfully effect a Business Combination.

The Company will provide its stockholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. In connection with a proposed Business Combination, the Company may seek stockholder approval of a Business Combination at a meeting called for such purpose at which stockholders may seek to redeem their shares, regardless of whether they vote for or against a Business Combination. The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the outstanding shares voted are voted in favor of the Business Combination.

If the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Company’s Amended and Restated Memorandum and Articles of Association provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from seeking redemption rights with respect to 15% or more of the Public Shares without the Company’s prior written consent.

~~F-6~~

~~Table of Contents~~

Based on the foregoing, management does not believe that the Company will have sufficient working capital to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, the Company will be using the funds held outside of the Trust Account for paying existing accounts payable and accrued liabilities, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination. The Company believes it may need to raise additional funds in order to meet the expenditures required for operating the business. Furthermore, if the Company’s estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an Initial Business Combination are less than the actual amount necessary to do so, the Company may have insufficient funds available to operate the business prior to the Initial Business Combination. Moreover, the Company may need to obtain additional financing either to complete the Initial Business Combination or to redeem a significant number of our public shares upon completion of the Initial Business Combination, in which case the Company may issue additional securities or incur debt in connection with such Initial Business Combination. The Company’s Sponsor, officers and directors may, but are not obligated to, loan the Company funds from time to time or at any time, in what ever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. The Company has until ~~November~~May 7, ~~2022, see~~2023 (see Note 9,9), to complete a Business Combination. It is uncertain that the Company will be able to consummate an initial Business Combination by this time. If an initial Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the Company. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the Company’s inability to continue as a going concern.

There is no assurance that the Company’s plans to consummate an Initial Business Combination will be successful within the Combination Period. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Risks and Uncertainties

Management is currently evaluating the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations, close of the Proposed Public Offering and/or search for a target company, the specific impact is not readily determinable as of the date of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Various social and political circumstances in the U.S. and around the world (including wars and other forms of conflict, including rising trade tensions between the United States and China, and other uncertainties regarding actual and potential shifts in the U.S. and foreign, trade, economic and other policies with other countries, terrorist acts, security operations and catastrophic events such as fires, floods, earthquakes, tornadoes, hurricanes and global health epidemics), may also contribute to increased market volatility and economic uncertainties or deterioration in the U.S. and worldwide. Specifically, the rising conflict between Russia and Ukraine, and resulting market volatility could adversely affect the Company’s ability to complete a business combination. In response to the conflict between Russia and Ukraine, the U.S. and other countries have imposed sanctions or other restrictive actions against Russia. Any of the above factors, including sanctions, export controls, tariffs, trade wars and other governmental actions, could have a material adverse effect on the Company’s ability to complete a Business Combination and the value of the Company’s securities.

F-8

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows.

In the opinion of the Company’s management, the unaudited financial statements as of ~~June~~September 30, 2022 include all adjustments, which are only of a normal and recurring nature, necessary for a fair statement of the financial position of the Company as of ~~June~~September 30, 2022 and its results of operations and cash flows for the three and ~~six~~nine months ended ~~June~~September 30, 2022. The results of operations for the three and ~~six~~nine months ended ~~June~~September 30, 2022 are not necessarily indicative of the results to be expected for the full fiscal year ending December 31, 2022 or any future interim period.

~~F-9~~

~~Table of Contents~~

Emerging growth company

The Company is an emerging growth company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies.

The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that the Company (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to the financial statements of issuers who are required to comply with the effective dates for new or revised accounting standards based on public company effective dates.

The Company will remain an emerging growth company until the earliest of (i) the last day of the first fiscal year (a) following the fifth anniversary of the completion of the Initial Public Offering, (b) in which the Company’s total annual gross revenue is at least $1.07 billion or (c) when the Company is deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700.0 million as of the prior June 30th and (ii) the date on which the Company has issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

Use of estimates

The preparation of the 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 financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.

Cash and cash equivalents

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company had 0no cash equivalents at ~~June~~September 30, 2022 or December 31, 2021.

Offering Costs Associated with the Initial Public Offering

The Company complies with the requirements of the Financial Accounting Standards Board (“FASB”) ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A, “Expenses of Offering.” Deferred offering costs were allocated to the separable financial instruments issued in the Initial Public Offering based on a relative fair value basis, compared to total proceeds received. Upon completion of the Initial Public Offering, offering costs associated with warrant liabilities have been expensed and presented as non-operating expenses in the statement of operations and offering costs associated with the Class A common stock have been charged to stockholders’ equity. Offering costs of $584,295 consisted principally of costs incurred in connection with preparation for the Initial Public Offering. These offering costs, together with the underwriter fees of $6,923,888, were charged to additional paid-in capital upon completion of the Initial Public Offering. Of these costs, $494,344 were allocated to the Public Warrants and the Private Placement Warrants and are included in the statement of operations as a component of other income (expense). After the Initial Public Offering occurred, offering costs with a fair value of $1,837,821 were recorded in connection with Class B Common Stock issued to the underwriters and a consultant.

F-9

Income taxes

The Company complies with the accounting and reporting requirements of ASC Topic 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company’s management determined the United States is the Company’s only major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if

~~F-10~~

~~Table of Contents~~

any, as income tax expense. There were 0no unrecognized tax benefits as of ~~June~~September 30, 2022 and December 31, 2021 and 0no amounts accrued for interest and penalties. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.

The Company’s effective tax rate was 7.8% and 0.0% for the three months ended September 30, 2022 and 2021, respectively, and 2.7% and 0.0% for the nine months ended September 30, 2022 and 2021, respectively. The effective tax rate differs from the statutory tax rate of 0% for the three and nine months ended September 30, 2022 and 2021, due to changes in the valuation allowance on the deferred tax assets.

The Inflation Reduction Act (“IR Act”) was enacted on August 16, 2022. The IR Act includes provisions imposing a 1% excise tax on share repurchases that occur after December 31, 2022 and introduces a 15% corporate alternative minimum tax (“CAMT”) on adjusted financial statement income. The CAMT will be effective for us beginning in fiscal 2024. We currently are not expecting the IR Act to have a material adverse impact to our financial statements.

Class A Common Stock Subject to Possible Redemption

The Company accounts for the Class A common stock subject to possible redemption in accordance with the guidance enumerated in ASC 480, “Distinguishing Liabilities from Equity.” Shares of the common stock subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable shares of the common stock (including shares of the common stock that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the issuer’s control) are classified as temporary equity. At all other times, shares of the common stock are classified as stockholders’ equity. The Class A common stock features certain redemption rights that are considered by the Company to be outside of the Company’s control and subject to the occurrence of uncertain future events. Accordingly, as of ~~June~~September 30, 2022 and December 31, 2021, the shares of the Class A common stock subject to possible redemption in the amount of ~~$177,424,608~~$179,736,777 and $175,693,636, respectively, are presented as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheet.

The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value, which approximates fair value, at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the re-measurement from initial carrying value to redemption amount value. The change in the carrying value of redeemable Class A common stock resulted in charges against additional paid-in capital (to the extent available), accumulated deficit and Class A common stock.

Gross proceeds	$	175,693,636
Less:
Proceeds allocated to the fair value of warrants		(11,760,676	)
Class A common stock issuance costs and overallotment costs		(3,832,731	)
Plus:
Accretion of carrying value to redemption value		15,593,409
Class A common stock subject to possible redemption - December 31, 2021		175,693,636
Extension increases		3,461,944
Remeasurement carrying value to redemption value		581,197
Class A common stock subject to possible redemption - September 30, 2022	$	179,736,777

F-10

Gross proceeds

$
175,693,636
Less:

Proceeds allocated to the fair value of warrants

(11,760,676)
Class A common stock issuance costs and overallotment costs

(3,832,731)
Plus:

Accretion of carrying value to redemption value

15,593,409
Class A common stock subject to possible redemption - December 31, 2021

175,693,636
Remeasurement carrying value to redemption value

1,730,972
Class A common stock subject to possible redemption - June 30, 2022

$
177,424,608

Net income (loss) per share

The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. Net income (loss) per share of common stock is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding for the period. The Company applies the two-class method in calculating income (loss) per share of common stock. Re-measurement associated with the redeemable shares of Class A common stock is excluded from income (loss) per common share as the redemption value approximates fair value.

The calculation of diluted income (loss) per share of common stock does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, and (ii) the Private Placement since the exercise of the warrants is contingent upon the occurrence of future events. The warrants are exercisable to purchase 8,946,731 shares of Class A common stock in the aggregate. As of ~~June~~September 30, 2022 and December 31, 2021, the Company did not have any dilutive securities or 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 net income (loss) per common share is the same as basic net income (loss) per common share for the period presented.

Class B Founder Shares subject to forfeiture are not included in weighted average shares outstanding until the forfeiture restrictions lapse.

Non-redeemable common stock includes the Founder Shares and non-redeemable shares of common stock as these shares do not have any redemption features.

~~F-11~~

~~Table of Contents~~

The following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts):

For the Three Months

For the Six Months

Ended June 30, 2022

Ended June 30, 2022

Class A

Class B

Class A

Class B
Basic and diluted net income per share








Numerator:








Allocation of net income

$
1,685,646

$
421,412

$
3,875,305

$
974,764
Denominator:








Basic and diluted weighted average shares outstanding

17,893,462

4,500,528

17,893,462

4,500,528

Basic and diluted net income per share

$
0.09

$
0.09

$
0.22

$
0.22

	For the Three Months				For the Nine Months
	Ended September 30, 2022				Ended September 30, 2022
	Class A		Class B		Class A		Class B
Basic and diluted net income per share
Numerator:
Allocation of net income	$	1,906,751	$	479,583	$	5,782,101	$	1,454,302
Denominator:
Basic and diluted weighted average shares outstanding		17,893,462		4,500,528		17,893,462		4,500,528

Basic and diluted net income per share	$	0.11	$	0.11	$	0.32	$	0.32

	For the Three Months						For the Nine Months
	Ended September 30, 2021						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)	($	214,735	)	($	54,010	)	$	4,207,810	$	1,815,934
Denominator:
Basic and diluted weighted average shares outstanding		17,893,462			4,500,598			10,534,895		4,546,468

Basic and diluted net income (loss) per share	$	(0.01	)	$	(0.01	)	$	0.40	$	0.40

For the Three Months

For the Six Months

Ended June 30, 2021

Ended June 30, 2021

Class A

Class B

Class A

Class B
Basic and diluted net income per share








Numerator:








Allocation of net income

$
5,871,391

$
421,823

$
3,528,052

$
2,764,437
Denominator:




Basic and diluted weighted average shares outstanding

10,544,337

766,485

5,832,251

4,559,913

Basic and diluted net income per share

$
0.35

$
0.35

$
0.58

$
0.58

Concentration of credit risk

Financial instruments that potentially subject the Company to concentration of credit risk consist of a cash account in a financial institution which, at times may exceed the Federal depository insurance coverage of $250,000. As of ~~June~~September 30, 2022 and December 31, 2021, the Company had not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.

F-11

Financial Instruments

The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels:

Level 1 Inputs: Unadjusted quoted prices for identical assets or instruments in active markets.

Level 2 Inputs: Quoted prices for similar instruments in active markets and quoted prices for identical or similar instruments in markets that are not active and model derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3 Inputs: Significant inputs into the valuation model are unobservable.

The Company does not have any recurring Level 2 assets or liabilities, see Note 8 for Level 3 assets and liabilities. The carrying value of the Company’s financial instruments including its cash and accrued liabilities approximate their fair values principally because of their short-term nature.

Derivative Financial Instruments

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging.” The Company’s derivative instruments are recorded at fair value as of the closing date of the Initial Public Offering (i.e., March 15, 2021) 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 balance sheet

~~F-12~~

~~Table of Contents~~

as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within twelve (12) months of the balance sheet date.

The Company has determined that the Public Warrants and the Private Placement Warrants are derivative instruments. As the Public Warrants and the Private Placement Warrants meet the definition of a derivative, the Public Warrants and the Private Placement Warrants are measured at fair value at issuance and at each reporting date in accordance with ASC 820, “Fair Value Measurement,” with changes in fair value recognized in the statement of operations in the period of change.

The Company has determined that the conversion option of the Note is a derivative instrument. The Company has elected to recognize the Note, including the conversion option, at fair value as permitted under ASC Topic 815. The Note is measured at fair value at issuance and at each reporting date in accordance with ASC 820, with changes in fair value recognized in the statement of operations in the period of change. The Company recognized an unrealized gain on fair value of debt for the change in the fair value of the Note of ~~$1,362,640~~$1,397,351 and $2,759,981 for the three and ~~six~~nine months ended ~~June~~September 30, ~~2022, which is comprised of an~~2022. There were no unrealized ~~gain on issuance of $1,363,544 and an unrealized loss of $904~~gains or losses for the ~~period from the date of issuance through June~~three and nine months ended September 30, ~~2022.~~2021.

Warrant Instruments

The Company accounts for the Public Warrants and the Private Placement Warrants issued in connection with the Initial Public Offering and the Private Placement, respectively, in accordance with the guidance contained in FASB ASC 815, “Derivatives and Hedging,” whereby under that provision the Public Warrants and the Private Placement Warrants do not meet the criteria for equity treatment and must be recorded as a liability. Accordingly, the Company classifies the warrant instrument as a liability at fair value and adjusts the instrument to fair value at each reporting period. This liability will be re-measured at each balance sheet date until the Public Warrants and the Private Placement Warrants are exercised or expire, and any change in fair value will be recognized in the Company’s statement of operations. The fair value of the Public Warrants and the Private Placement Warrants will be estimated using an internal valuation model. The Company’s valuation model utilizes inputs and other assumptions and may not be reflective of the price at which they can be settled. Such warrant classification is also subject to re-evaluation at each reporting period.

Recently issued accounting pronouncements

Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.

NOTE 3. INITIAL PUBLIC OFFERING

Pursuant to the Initial Public Offering, which was consummated in May 2021, the Company sold 17,309,719 Units, which includes underwriters’ over-allotment, at a purchase price of $10.00 per Unit generating gross proceeds to the Company in the amount of $173.1 million. Each Unit consists of 1one share of the Company’s Class A common stock, par value $0.0001 per share (the “Class A Common Stock”), and ~~one~~one-half~~-half~~ of one redeemable warrant of the Company (each whole warrant, a “Warrant”), with each whole Warrant entitling the holder thereof to purchase 1one whole share of Class A Common Stock at a price of $11.50 per share, subject to adjustment.

F-12

~~F-13~~

~~Table of Contents~~

NOTE 4. RELATED PARTY TRANSACTIONS

Founder Shares

On January 28, 2021, the Company issued an aggregate of 5,750,000 shares of Class B common stock to the Sponsor for an aggregate purchase price of $25,000 in cash. On May 4, 2021, the Sponsor returned to the Company, at no cost, an aggregate of 1,150,000 founder shares, which the Company cancelled. Shares and associated accounts have been retroactively restated to reflect the surrender of 1,150,000 Class B ordinary shares to the Company for 0no consideration on May 4, 2021. The Sponsor also transferred 70,000 founder shares to ARC Group Limited in consideration of services provided by such party as financial advisor to the Company in connection with the offering and recorded $529,200 which is recorded as a stock issuance cost. As a result, the Sponsor currently owns 4,530,000 founder shares. Such Class B common stock included an aggregate of up to 600,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment is not exercised in full or in part, so that the Sponsor will collectively own 20% of the Company’s issued and outstanding shares after the Initial Public Offering (assuming the initial stockholders do not purchase any Public Shares in the Initial Public Offering and excluding the Private Placement Units and underlying securities). On May 7, 2021, the Company issued 160,000 shares of Class B common stock to the underwriter for services rendered and recorded $1,209,600 which is recorded as a stock issuance cost. On May 12, 2021, the Company issued 13,098 shares of Class B common stock to the underwriter for services rendered and recorded $99,021 which is recorded as a stock issuance cost. As a result of the underwriters’ election to partially exercise their over-allotment option on May 10, 2021, 272,570 Founder Shares are no longer subject to forfeiture.

The initial stockholder has agreed not to transfer, assign or sell any of the Class B common stock ~~(except to certain permitted transferees)~~or shares of Common Stock issuable upon conversion thereof, until ~~with respect to 50% of the Class B common stock,~~ the earlier to occur of ~~(i)~~(A) six months after the ~~date~~completion of the ~~consummation of a~~Company’s initial Business Combination ~~or (ii)~~and (B) subsequent to the ~~date on which~~Company’s initial Business Combination, (x) if the ~~closing~~reported last sale price of the ~~Company’s common stock~~Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and ~~recapitalizations)~~the like) for any 20 trading days within any 30-trading day period commencing ~~after a Business Combination, with respect to the remaining 50% of the Class B common stock, upon six months~~at least 150 days after the ~~date of the consummation of a~~Company’s initial Business Combination, or ~~earlier, in each case, if, subsequent to a Business Combination,~~(y) the date on which the Company ~~consummates~~completes a ~~subsequent~~ liquidation, merger, capital stock exchange, reorganization or other similar transaction ~~which~~that results in all of the Company’s stockholders having the right to exchange their ~~common stock~~shares of Common Stock for cash, securities or other property.

Private Placement

Simultaneously with the closing of the Initial Public Offering, the Company consummated the private sale of an aggregate of 583,743 units, which includes underwriters’ over-allotment, to the Sponsor at a purchase price of $10.00 per unit, generating gross proceeds to the Company in the amount of $5,837,430. During the three months ended September 30, 2021, due to the downsizing of the Initial Public Offering, $124,289 of funds were returned to the Sponsor.

A portion of the proceeds from the Private Placement Units was added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Units held in the Trust Account will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Units will be worthless.

The Sponsor and the Company’s officers and directors agreed, subject to limited exceptions, not to transfer, assign or sell any of their Private Placement Shares until 30 days after the completion of the initial Business Combination.

~~F-14~~

~~Table of Contents~~F-13

Promissory Note – Related Party

On January 29, 2021, the Sponsor issued an unsecured promissory note to the Company, pursuant to which the Company may borrow up to an aggregate principal amount of $300,000, to be used for payment of costs related to the Initial Public Offering. The note is non-interest bearing and payable on the earlier of (i) June 30, 2021 or (ii) the consummation of the Initial Public Offering. In 2021, the Company borrowed $177,111 under this promissory note, which was repaid in full. As of ~~June~~September 30, 2022 and December 31, 2021, the balance outstanding under the promissory note with the Sponsor was $0.

Related Party Loans

In order to finance transaction costs in connection with a Business Combination, the Company’s Sponsor or an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“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, up to $1,500,000 of notes and any other loans made by the Sponsor or its affiliates (including the loans made to effectuate extensions as described below), the Company’s officers and directors, or the Company’s and their affiliates prior to or in connection with a Business Combination may be converted upon consummation of a Business Combination into additional Private Placement Units at a price of $10.00 per Unit. In the event that a Business Combination does not close, the Company 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. As of ~~June~~September 30, 2022 and December 31, 2021, the Company had 0no borrowings under the Working Capital Loans.

Pursuant to its amended and restated certificate of incorporation, the Company may extend the period of time to consummate a Business Combination up to two times, each by an additional three months (for a total of up to 18 months to complete a Business Combination). In order to effectuate such extensions, the Sponsor or its affiliates or designees must deposit into the Trust Account $1,730,972 ($0.10 per share) on or prior to the date of the applicable deadline, for each three-month extension (or up to an aggregate of $3,461,944 or $0.20 per share if the Company extends for the full six months). Any such payments would be made in the form of a loan. Any such loans will be non-interest bearing and payable upon the consummation of a Business Combination out of the proceeds of the trust account released to it. If the Company does not consummate a Business Combination, such loans will not be repaid.

On May 3, 2022 the Company issued a promissory note (the “Note”) in the principal amount of $1,730,972 (the “Extension Payment”) to the Sponsor in connection with the First Extension (as defined below). The Note bears 0no interest and is due and payable upon the earlier to occur of (i) the date on which the Company’s initial business combination is consummated and (ii) the liquidation of the ~~Company on or before August 7, 2022 (unless extended to November 7, 2022) or such later liquidation date as may be approved by the Company’s stockholders.~~Company. At the election of the Sponsor, up to $1,500,000 of the unpaid principal amount of the Note may be converted into units of the Company (the “Conversion Units”) with the total Conversion Units so issued shall be equal to: (x) the portion of the principal amount of the Note being converted divided by (y) the conversion price of ten dollars ($10.00), rounded up to the nearest whole number of units. On August 4, 2022, the Company amended and restated the Note (the “Amended Note”) in its entirety solely to increase the principal amount thereunder from $1,730,972 to $3,461,944 in connection with the Second Extension. As of ~~June~~September 30, 2022 outstanding loans were ~~$1,730,972~~$3,461,944 and the carrying value was ~~$368,352~~.$701,974.

NOTE 5. COMMITMENTS AND CONTINGENCIES

Registration Rights

The holders of the founder shares, the representative shares (see Note 7) as well as the holders of the Private Placement Units (and underlying securities) and any securities issued in payment of working capital loans made to the Company, will be entitled to registration rights pursuant to an agreement to be signed prior to or on the effective date of Initial Public Offering. The holders of a majority of these securities are entitled to make up to two demands that the Company register such securities. Notwithstanding anything to the contrary, such holders may only make a demand registration (i) on one occasion and (ii) during the five year period beginning on the effective date of the Initial Public Offering. The holders of the majority of the founder shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these common stock are to be released from escrow. The holders of a majority of the Private Placement Units (and underlying securities) and securities issued in payment of working capital loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the consummation of a Business Combination. Notwithstanding anything to the contrary, such holders may participate in a “piggy-back” registration only during the seven-year period beginning on the effective date of the Initial Public Offering. The Company will bear the expenses incurred in connection with the filing of any such registration statements.

~~F-15~~

~~Table of Contents~~F-14

Underwriting Agreement

The Company granted the underwriters a 45-day option from the date of Initial Public Offering to purchase up to 2,400,000 additional Units to cover over-allotments, if any, at the Initial Public Offering price less the underwriting discounts and commissions. In connection with this issuance, the Company recorded an over-allotment liability of $162,847. On May 12, 2021, the underwriters partially exercised the over-allotment option to purchase an additional 1,309,719 Units. Upon partial exercise of the over-allotment option, an additional 32,743 private units were purchased and $59,141 of the remaining overallotment liability was recorded to change in fair value of derivative liabilities in the accompanying statement of operations. As a result of the underwriters’ election to partially exercise their over-allotment option, 272,570 Founder Shares are no longer subject to forfeiture.

The underwriters were entitled to a cash underwriting discount of: (i) one percent (1.00%) of the gross proceeds of the Initial Public Offering. The cash discount of $1,730,972 was paid in May 2021 upon the closing of the IPO. In addition, the underwriters are entitled to a deferred fee of three percent (3.00%) of the gross proceeds of the Initial Public Offering upon the closing of a Business Combination. The deferred fee after the IPO was consummated in May 2021 was $5,192,916. The deferred fee will be paid in cash upon the closing of a Business Combination from the amounts held in the Trust Account, subject to the terms of the underwriting agreement.

Right of First Refusal

For a period beginning on the closing of this offering and ending 18 months from the closing of a business combination, we have granted EF Hutton, division of Benchmark Investment, LLC a right of first refusal to acting as sole investment banker, sole book runner and/or sole placement for any and all future private or public equity and debt offerings, including equity-linked financings during such period. In accordance with FINRA Rule 5110(f)(2)(E)(i), such right of first refusal shall not have a duration of more than three years from the effective date of the registration statement of which this prospectus forms a part.

NOTE 6. WARRANTS

At ~~June~~September 30, 2022 and December 31, 2021, the Company had 8,654,860 Public Warrants and 291,872 Private Placement Warrants outstanding, respectively.

On April 12, 2021, the SEC issued a statement with respect to the accounting for warrants issued by special purchase acquisition companies. In light of the SEC Staff’s Statement, the Company has determined that the fair value of the warrants should be classified as a warrant liability on the Company’s balance sheets and subsequent changes to the fair value of the warrants will be recorded in the Company’s statements of operations.

Public Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants will become exercisable on the later of (a) the consummation of a Business Combination or (b) 12 months from the effective date of the registration statement relating to the Initial Public Offering. No Public Warrants will be exercisable for cash unless the Company has an effective and current registration statement covering the common stock issuable upon exercise of the Public Warrants and a current prospectus relating to such common stock. Notwithstanding the foregoing, if a registration statement covering the common stock issuable upon the exercise of the Public Warrants is not effective within 60 days from the consummation of a Business Combination, the holders may, until such time as there is an effective registration statement and during any period when the Company shall have failed to maintain an effective registration statement, exercise the Public Warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. If an exemption from registration is not available, holders will not be able to exercise their Public Warrants on a cashless basis. The Public Warrants will expire five years from the consummation of a Business Combination or earlier upon redemption or liquidation.

The ~~Company~~Company may call the warrants for redemption (excluding the Private Placement Warrants), in whole and not in part, at a price of $0.01 per warrant:

●

at any time while the Public Warrants are exercisable,

●

upon not less than 30 days’ prior written notice of redemption to each Public Warrant holder,

F-15

●

if, and only if, the reported last sale price of the common stock equals or exceeds $18.00 per share, for any 20 trading days within a 30 trading day period ending on the third trading day prior to the notice of redemption to Public Warrant holders, and

~~F-16~~

~~Table of Contents~~

●

if, and only if, there is a current registration statement in effect with respect to the common stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.

The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the common stock issuable upon the exercise of the Private Placement Warrants are not be transferable, assignable or salable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants are exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Placement Warrants are redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuances of common stock at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such warrants. Accordingly, the warrants may expire worthless.

The exercise price is $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the “Market Value”) is below $9.20 per share, then the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the greater of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under “Redemption of warrants” will be adjusted (to the nearest cent) to be equal to 180% of the greater of the Market Value and the Newly Issued Price.

The accounting treatment of derivative financial instruments requires that the Company record a derivative liability upon the closing of the Initial Public Offering. Accordingly, the Company classified each Warrant as a liability at its fair value, and the Warrants were allocated a portion of the proceeds from the issuance of the Units equal to their fair value determined by the Monte Carlo simulation. This liability is subject to re-measurement at each balance sheet date. With each such re-measurement, the warrant liability will be adjusted to fair value, with the change in fair value recognized in the Company’s statement of operations. The Company will reassess the classification at each balance sheet date. If the classification changes as a result of events during the period, the Warrants will be reclassified as of the date of the event that causes the reclassification.

In the Company’s fiscal quarter ended on June 30, 2021, the warrants detached from the units and started trading, therefore, since the fiscal quarter ended on June 30, 2021, the trading price for the public warrants will be used as the fair value of the public warrants.

~~F-17~~

~~Table of Contents~~F-16

For the private and public warrant at the IPO date, and for the private warrants at ~~June~~September 30, 2022, the following assumptions were used to calculate the fair value:

June 30, 2022

December 31, 2021

May 7, 2021

Risk-free interest rate

3.01
%
0.32-1.26
%
0.8
%
Expected life of grants

5.33
years
5
years
5.0
years
Expected volatility of underlying stock

0
%
5-12
%
20
%
Dividends

0
%
0
%
0
%
Probability of Business Combination

80
%
80
%
80
%

	September 30, 2022	December 31, 2021	May 7, 2021
Risk-free interest rate	4.06%	0.32-1.26 %	0.8%
Expected life	5.08 years	5 years	5.0 years
Expected volatility of underlying stock	0%	5-12 %	20%
Dividends	0%	0%	0%
Probability of Business Combination	80%	80%	80%

As of ~~June~~September 30, 2022 and December 31, 2021, the derivative liability was ~~$894,673.~~$264,074 and $4,499,172, respectively. In addition, for the three and ~~six~~nine months ended ~~June~~September 30, ~~2022,~~2021, the Company recorded ~~gains~~a loss of ~~$806,665~~$176,892 and ~~$3,604,499,~~a gain of $6,799,986, respectively, on the change in fair value of the derivative warrants which is included in change in fair value of derivative liabilities in the accompanying statements of operations. In addition, for the three and nine months ended September 30, 2022, the Company recorded gains of $630,598 and $4,235,097, respectively, on the change in fair value of the derivative warrants which is included in change in fair value of derivative liabilities in the accompanying statements of operations.

NOTE 7. STOCKHOLDERS’ EQUITY (DEFICIT)

Class A Common Stock— The Company is authorized to issue 100,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of the Company’s Class A common stock are entitled to 1one vote for each share. At ~~June~~September 30, 2022 and December 31, 2021, there were 17,893,462 shares of the Class A Common Stock, including ~~17,309,739~~17,309,719 shares of the Class A Common Stock subject to possible redemption, that were classified as temporary equity in the accompanying balance sheets.

Class B Common Stock— The Company is authorized to issue 10,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of the Company’s Class B common stock are entitled to 1one vote for each share. At ~~June~~September 30, 2022 and December 31, 2021, there were 4,500,528 shares of Class B common stock issued and outstanding held by the Sponsor a consultant and the underwriter. On May 4, 2021, the Company effected a cancellation agreement with the Sponsor, pursuant to which the Company cancelled 1,150,000 founder shares, resulting in the Sponsor holding 4,600,000 founder shares (of which 600,000 of such shares being subject to forfeiture to the extent that the underwriter’s over-allotment option is not exercised in full) so that the initial stockholders will own 20% of the issued and outstanding shares after the Initial Public Offering (assuming the initial stockholders do not purchase any Public Shares in the Initial Public Offering and excluding the Founder Shares). The Sponsor also transferred 70,000 Founder Shares to ARC Group Limited in consideration of services provided by such party as financial advisor to the Company in connection with the Initial Public Offering. Shares and associated accounts have been retroactively restated to reflect the surrender of 1,150,000 Class B ordinary shares. The Class B common stock will automatically convert into shares of Class A common stock at the time of the consummation of our initial business combination, on a one-for-one basis.

Preferred Shares — The Company is authorized to issue 1,000,000 preferred shares with a par value of $0.0001 per share with such designation, rights and preferences as may be determined from time to time by the Company’s Board of Directors. At ~~June~~September 30, 2022 and December 31, 2021, there were 0no preferred shares issued or outstanding.

F-17

NOTE 8. FAIR VALUE MEASUREMENTS

The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.

The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

Level 1:

Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

~~F-18~~

~~Table of Contents~~

Level 2:

Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.

Level 3:

Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.

The following table presents information about the Company’s assets and liabilities that are measured at fair value at ~~June~~September 30, 2022 and December 31, 2021 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

Description

Level

June 30, 2022

December 31, 2021
Assets:

Marketable securities held in the Trust Account

1

$
177,740,015

$
175,719,039

Liabilities:






Note payable – Sponsor

3

$
368,342

—
Warrant Liability – Private Placement Warrants

3

$
29,188

$
182,128
Warrant Liability – Public Warrants

1

$
865,486

$
4,317,045

Description	Level		September 30, 2022		December 31, 2021
Assets:
Marketable securities held in the Trust Account		1	$	179,927,820	$	175,719,039

Liabilities:
Note payable – Sponsor		3	$	701,974		—
Warrant Liability – Private Placement Warrants		3	$	8,757	$	182,128
Warrant Liability – Public Warrants		1	$	255,318	$	4,317,044

The Public Warrants and the Private Placement Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within liabilities in the balance sheets. The Warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of Warrant liabilities in the statement of operations.

Upon consummation of the Initial Public Offering, the Company used a Monte Carlo simulation model to value the Public Warrants and a modified Black-Scholes model to value the Private Placement Warrants. The Company allocated the proceeds received from (i) the sale of Units (which is inclusive of 1one share of the Class A Common Stock and ~~1-half~~one-half of one Public Warrant), (ii) the sale of the Private Placement Warrants and (iii) the issuance of the Class B Common Stock, first to the Warrants based on their fair values as determined at initial measurement, with the remaining proceeds allocated to the Class A Common Stock subject to possible redemption (temporary equity), the Class A Common Stock (permanent equity) and the Class B Common Stock (permanent equity) based on their relative fair values at the initial measurement date. At the initial measurement date, the Warrants were classified within Level 3 of the fair value hierarchy at the measurement dates due to the use of unobservable inputs.

F-18

As of ~~June~~September 30, 2022 and December 31, 2021, the Public Warrants were valued using the publicly available price for the Warrant and are classified as Level 1 on the Fair Value Hierarchy. As of ~~June~~September 30, 2022 and December 31, 2021, the Company used a modified Black-Scholes model to value the Private Placement Warrants. The Company relied upon the implied volatility of the Public Warrants and the implied volatilities of comparable companies and the closing price as of ~~June~~September 30, 2022 and December 31, 2021 per Public Warrant to estimate the volatility for the Private Placement Warrants. As of ~~June~~September 30, 2022 and December 31, 2021, the Private Placement Warrants were classified within Level 3 of the Fair Value Hierarchy at the measurement dates due to the use of unobservable inputs.

The fair value of the note is the aggregate of (i) the liquidation-adjusted present value of the straight debt, discounted by a six-month risk-free yield ~~1.97%~~2.9% and spread on extrapolatable corporate bonds of ~~11.16%~~11.7% prevalent at the time of valuation; (ii) the liquidation-adjusted fair value of the call option using the Black-Scholes method taking the stock price ~~$10.22,~~$10.34, six-month risk-free yield of ~~1.97%~~2.9% and volatility of ~~35.20%~~27.6% observed in extrapolatable benchmarks, prevalent at the time of the valuation; and (iii) the fair value of the warrants derived at $0.10 from the convertible units. The assumption for the probably of a business combination is 20%.

~~F-19~~

~~Table of Contents~~

NOTE 9. SUBSEQUENT EVENTS

Management has evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements were issued. Based upon this review, other than the below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements.

~~Trust Extension~~

On ~~August~~November 4, 2022, the Company ~~amended~~held a special meeting in lieu of the 2022 annual meeting of stockholders (the “Meeting”). At the Meeting, the Company’s stockholders approved an amendment to the Company’s Amended and ~~restated~~Restated Certificate of Incorporation (the “Charter Amendment”) to extend the ~~Note~~date by which the Company must consummate its initial business combination from November 7, 2022 to May 7, 2023 or such earlier date as determined by the Company’s board of directors (the ~~“Amended Note”~~“Board”) ~~in its entirety solely to increase~~. The Company filed the ~~principal amount thereunder from $1,730,972 to $3,461,944 in~~Charter Amendment with the Secretary of State of the State of Delaware on November 4, 2022.

In connection with the ~~Second Extension. The Note bears no interest~~Meeting, stockholders holding 13,769,910 shares of Class A common stock (“Public Shares”) exercised their right to redeem such shares for a pro rata portion of the funds in the Company’s trust account (“Trust Account”). As a result, approximately $143.5 million (approximately $10.42 per Public Share) will be removed from the Trust Account to pay such holders and ~~is due~~approximately $36.9 million will remain in the Trust Account. Following redemptions, the Company will have 3,539,809 Public Shares outstanding.

As a result of stockholder approval of the Charter Amendment, and ~~payable upon the earlier to occur of (i) the date on which~~ the Company’s implementation thereof, the Sponsor or its designees will contribute to the Company as a loan an aggregate of $ 0.045 for each share of Class A commons stock that is not redeemed, for each calendar month (commencing on November 7, 2022 and on the 7th day of each subsequent month) until May 7, 2023 (each, an “Extension Period”), or portion thereof, that is needed to complete an initial business combination ~~is consummated and (ii)~~(the “Contribution”).

Based on the ~~liquidation~~outstanding 3,539,809 Public Shares following redemptions as disclosed above, each monthly Contribution will be $159,291 which will be deposited in the Trust Account within five (5) business days from the beginning of such calendar month (or portion thereof). The Company will have the sole discretion whether to continue extending for additional calendar months until May 7, 2023. If the Company ~~on or before November 7, 2022 or such later liquidation date as may be approved by the Company’s stockholders. At the election of the Sponsor, up~~opts not to $1,500,000 of the unpaid principal amount of the Note may be converted into units of the Company identical to the private placement units issued contemporaneously with the Company’s initial public offering (the ~~“Conversion Units”~~~~) with the total Conversion Units so issued shall be equal to: (x) the~~utilize any remaining portion of the ~~principal amount of~~Extension Period, then the ~~Note being converted divided by (y) the conversion price of ten dollars ($10.00), rounded up~~Company will liquidate and dissolve promptly in accordance with its charter, and its Sponsor’s obligation to ~~the nearest whole number of units.~~make additional Contributions will terminate.

F-19

~~F-20~~

~~Table of Contents~~

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Recent Developments

Effective May 7, 2022 and August 7, 2022, the Company extended the date by which it has to consummate an initial business combination from May 7, 2022 to August 7, 2022, and from August 7, 2022 to November 7, 2022, respectively ~~(collectively,~~(namely “First Extension” and “Second Extension”, collectively, the “Extensions”). The Extensions comprise up to two three-month extensions permitted under the Company’s governing documents and provides the Company with additional time to complete an initial business combination. On each of May 3, 2022 and August 7, 2022, the Sponsor loaned to the Company a sum of $1,730,972 in order to support each Extension, for an aggregate of $3,461,944. The loan is non-interest bearing and will be payable upon the earlier of consummation of the Company’s initial business combination and its winding up. At the election of the Sponsor, up to $1,500,000 of the loan is convertible into units of the Company identical to the units issued to the Sponsor in the private placement concurrent with the Company’s Initial Public Offering, at a conversion price of $10 per unit.

On November 4, 2022, the Company held a special meeting in lieu of the 2022 annual meeting of stockholders (the “Meeting”). At the Meeting, the Company’s stockholders approved an amendment to the Company’s Amended and Restated Certificate of Incorporation (the “Charter Amendment”) to extend the date by which the Company must consummate its initial business combination from November 7, 2022 to May 7, 2023 or such earlier date as determined by the Company’s board of directors (the “Board”). The Company filed the Charter Amendment with the Secretary of State of the State of Delaware on November 4, 2022.

In connection with the Meeting, stockholders holding 13,769,910 shares of Class A common stock (“Public Shares”) exercised their right to redeem such shares for a pro rata portion of the funds in the Company’s trust account (“Trust Account”). As a result, approximately $143.5 million (approximately $10.42 per Public Share) will be removed from the Trust Account to pay such holders and approximately $36.9 million will remain in the Trust Account. Following redemptions, the Company will have 3,539,809 Public Shares outstanding.

As a result of the stockholder approval of Charter Amendment, the Sponsor or its designees will contribute to the Company as a loan an aggregate of $ 0.045 for each share of Class A commons stock that is not redeemed, for each calendar month (commencing on November 7, 2022 and on the 7th day of each subsequent month) until May 7, 2023 (each, an “Extension Period”), or portion thereof, that is needed to complete an initial business combination (the “Contribution”).

Based on the outstanding 3,539,809 Public Shares following redemptions as disclosed above, each Contribution is in total of $159,291 which will be deposited in the Trust Account within five (5) business days from the beginning of such calendar month (or portion thereof). The Company will have the sole discretion whether to continue extending for additional calendar months until May 7, 2023. If the Company opts not to utilize any remaining portion of the Extension Period, then the Company will liquidate and dissolve promptly in accordance with its charter, and its Sponsor’s obligation to make additional Contributions will terminate.

Results of Operations

We have not generated any revenues to date, and we will not be generating any operating revenues until the closing and completion of our initial Business Combination. Our entire activity up to ~~June~~September 30, 2022 ~~was~~has been related to our formation, the Initial Public Offering and, since the closing of the Initial Public Offering, and a search for a Business Combination target. We have, and expect to continue to generate, non-operating income in the form of interest income and unrealized gains on investments held in the Trust Account. We expect to continue to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with the search for a Business Combination target.

For the three months ended ~~June~~September 30, 2022, we had net income of ~~$2,107,058,~~$2,386,334, which primarily consisted of change in fair value of the derivative warrant liabilities of ~~$806,665,~~$630,598, unrealized gain on fair value of debt of ~~$1,362,630~~$1,397,351 and unrealized gain on the Trust assets of ~~$168,445,~~$818,333, partially offset by operating expenses of ~~$230,682.~~$257,417 and tax expense of $202,531.

For the ~~six~~nine months ended ~~June~~September 30, 2022, we had net income of ~~$4,850,069,~~$7,236,403, which primarily consisted of change in fair value of the derivative warrant liabilities of ~~$3,604,499,~~$4,235,097, unrealized gain on fair value of debt of ~~$1,362,630~~$2,759,981 and unrealized gain on the Trust assets of ~~$290,004,~~$1,108,337, partially offset by operating expenses of ~~$407,064.~~$664,481 and tax expense of $202,531.

Going Concern, Liquidity and Capital Resources

Until the consummation of the initial public offering, our only source of liquidity will be the initial sale of the Founder Shares to our Sponsor and advances under the promissory note with the Sponsor.

Pursuant to the Initial Public Offering, which was consummated in May 2021, the Company sold 17,309,719 Units, which includes underwriters’ over-allotment, at a purchase price of $10.00 per Unit generating gross proceeds to the Company in the amount of $173.1 million. Each Unit consists of one share of the Company’s Class A common stock, par value $0.0001 per share (the “Class A Common Stock”), and one-half of one redeemable warrant of the Company (each whole warrant, a “Warrant”), with each whole Warrant entitling the holder thereof to purchase one whole share of Class A Common Stock at a price of $11.50 per share, subject to adjustment.

Simultaneously with the closing of the Initial Public Offering, the Company consummated the private sale (the “Private Placement”) of an aggregate of 583,743 Units, which includes underwriters’ over-allotment, (the “Private Placement Units”) to Maquia Investment North America LLC at a purchase price of $10.00 per Private Placement Unit, generating gross proceeds to the Company in the amount of $5,837,430.

As indicated in the accompanying financial statements, at ~~June~~September 30, 2022, the Company had ~~$52,583~~$249,357 in cash, and a working capital deficit of ~~$418,541.~~$850,610.

~~Table of Contents~~2

In order to finance transaction costs in connection with a Business Combination, the Company’s Sponsor or an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“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, up to $1,500,000 of notes and any other loans made by the Sponsor or its affiliates (including the loans made to effectuate extensions as described below), the Company’s officers and directors, or the Company’s and their affiliates prior to or in connection with a Business Combination may be converted upon consummation of a Business Combination into additional Placement Units at a price of $10.00 per Unit. In the event that a Business Combination does not close, the Company 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. As of ~~June~~September 30, 2022, the Company had no borrowings under the Working Capital Loans.

We may also need to obtain additional financing either to complete a business combination or because we become obligated to redeem a significant number of shares of our Class A common stock upon completion of the business combination, in which case we may issue additional securities or incur debt in connection with the business combination.

Based on the foregoing, management does not believe that the Company will have sufficient working capital and borrowing capacity to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, the Company will be using the funds held outside of the Trust Account for paying existing accounts payable and accrued liabilities, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination. The Company believes it may need to raise additional funds in order to meet the expenditures required for operating the business. Furthermore, if the Company’s estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an Initial Business Combination are less than the actual amount necessary to do so, the Company may have insufficient funds available to operate the business prior to the Initial Business Combination. Moreover, the Company may need to obtain additional financing either to complete the Initial Business Combination or to redeem a significant number of our public shares upon completion of the Initial Business Combination, in which case the Company may issue additional securities or incur debt in connection with such Initial Business Combination. The Company’s Sponsor, officers and directors may, but are not obligated to, loan the Company funds from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. The Company has until ~~November~~May 7, ~~2022,~~2023, unless further extended, as described below, to complete a Business Combination. It is uncertain that the Company will be able to consummate an initial Business Combination by this time. If an initial Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the Company. The factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that result from the Company’s inability to continue as a going concern.

On May 3, 2022 the Company issued a promissory note (the “Extension Note”) in the principal amount of $1,730,972 (the “Extension Payment”) to the Sponsor in connection with the Extension (as defined below). The Extension Note bears no interest and is due and payable upon the earlier to occur of (i) the date on which the Company’s initial business combination is consummated and (ii) the liquidation of the Company. On August 4, 2022, the Company amended and restated the Extension Note to increase the Extension Payment to ~~$3,461,944.80.~~$3,461,944. At the election of the Sponsor, up to $1,500,000 of the unpaid principal amount of the Extension Note may be converted into units of the Company (the “Conversion Units”) with the total Conversion Units so issued shall be equal to: (x) the portion of the principal amount of the Note being converted divided by (y) the conversion price of ten dollars ($10.00), rounded up to the nearest whole number of units.

Critical Accounting Policies

We have identified the following as our critical accounting policies:

Use of Estimates

The preparation of the financial statements in conformity with GAAP requires our 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 financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.

Class A Common Stock Subject to Possible Redemption

We account for the Class A common stock subject to possible redemption in accordance with the guidance enumerated in ASC 480, “Distinguishing Liabilities from Equity.” Shares of the common stock subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable shares of the common stock (including shares of the common stock that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the issuer’s control) are classified as temporary equity. At all other times, shares of the common stock are classified as stockholders’ equity. The Class A common stock features certain redemption rights that are considered by the Company to be outside of our control and subject to the occurrence of uncertain future events. Accordingly, as of ~~June~~September 30, 2022 and December 31, 2021, the shares of the Class A common stock subject to possible redemption in the amount of ~~$177,424,608~~$179,736,777 and $175,693,636, respectively, are presented as temporary equity, outside of the stockholders’ equity section of our balance sheet.

Net income (loss) per share

We comply with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. Net income (loss) per share of common stock is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding for the period. We apply the two-class method in calculating income (loss) per share of common stock. Re-measurement associated with the redeemable shares of Class A common stock is excluded from income (loss) per common share as the redemption value approximates fair value.

The calculation of diluted income (loss) per share of common stock does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, and (ii) the Private Placement since the exercise of the warrants is contingent upon the occurrence of future events. The warrants are exercisable to purchase 8,946,731 shares of Class A common stock in the aggregate. As of ~~June~~September 30, 2022 and December 31, 2021, we did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of our company. As a result, diluted net income (loss) per common share is the same as basic net income (loss) per common share for the periods presented.

Founder Shares subject to forfeiture are not included in weighted average shares outstanding until the forfeiture restrictions lapse.

Financial Instruments

We determine fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels:

Level 1 Inputs: Unadjusted quoted prices for identical assets or instruments in active markets.

Level 2 Inputs: Quoted prices for similar instruments in active markets and quoted prices for identical or similar instruments in markets that are not active and model derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3 Inputs: Significant inputs into the valuation model are unobservable.

We do not have any recurring Level 2 assets or liabilities, see Note 9 for recurring Level 3 liabilities. The carrying value of our financial instruments including its cash and accrued liabilities approximate their fair values principally because of their short-term nature.

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.” Our derivative instruments are recorded at fair value as of the closing date of our Initial Public Offering (May 7, 2021) 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 balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within twelve (12) months of the balance sheet date.

~~Table of Contents~~

We have determined that the Public Warrants and the Placement Warrants are derivative instruments. As the Public Warrants and the Placement Warrants meet the definition of a derivative, the Public Warrants and the placement warrants are measured at fair value at issuance and at each reporting date in accordance with ASC 820, “Fair Value Measurement,” with changes in fair value recognized in the statement of operations in the period of change.

We have determined that the conversion option of the Note is a derivative instrument. We have elected to recognize the Note, including the conversion option, at fair value as permitted under ASC Topic 815. The Note is measured at fair value at issuance and at each reporting date in accordance with ASC 820, with changes in fair value recognized in the statement of operations in the period of change. The Company recognized an unrealized gain on fair value of debt for the change in the fair value of the Note of $1,362,640 for the three and six months ended June 30, 2022, which is comprised of an unrealized gain on issuance of $1,363,544 and an unrealized loss of $904 for the period from the date of issuance through June 30, 2022.

Warrant Instruments

We account for the Public Warrants and the Placement Warrants issued in connection with our Initial Public Offering and the Private Placement, respectively, in accordance with the guidance contained in FASB ASC 815, “Derivatives and Hedging,” whereby under that provision the Public Warrants and the Placement Warrants do not meet the criteria for equity treatment and must be recorded as a liability. Accordingly, We classify the warrant instrument as a liability at fair value and adjusts the instrument to fair value at each reporting period. This liability will be re-measured at each balance sheet date until the Public Warrants and the Placement Warrants are exercised or expire, and any change in fair value will be recognized in our statement of operations. The fair value of the Public Warrants and the Placement Warrants will be estimated using an internal valuation model. Our valuation model utilizes inputs and other assumptions and may not be reflective of the price at which they can be settled. Such warrant classification is also subject to re-evaluation at each reporting period.

Other Factors That May Adversely Affect our Results of Operations

Our results of operations and our ability to complete an Initial Business Combination may be adversely affected by various factors that could cause economic uncertainty and volatility in the financial markets, many of which are beyond our control. Our business could be impacted by, among other things, downturns in the financial markets or in economic conditions, increases in oil prices, inflation, increases in interest rates, supply chain disruptions, declines in consumer confidence and spending, the ongoing effects of the COVID-19 pandemic, including resurgences and the emergence of new variants, and geopolitical instability, such as the military conflict in Ukraine. We cannot at this time fully predict the likelihood of one or more of the above events, their duration or magnitude or the extent to which they may negatively impact our business and our ability to complete an Initial Business Combination.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not required for smaller reporting companies.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended ~~June~~September 30, 2022, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, and in light of the material weakness in internal controls to properly evaluate complex equity transactions, our principal executive officer and principal financial and accounting officer has concluded that during the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were not effective as of ~~June~~September 30, 2022.

Disclosure controls and procedures are controls and other procedures 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 management, including our Certifying Officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended ~~June~~September 30, 2022 covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting, with the exception of the below.

~~Table of Contents~~

Our internal control over financial reporting was not effective to properly evaluate complex equity transactions. This lack of control led to the improper accounting classification of certain Class A common stock subject to redemption we issued in May 2021 as part of our Initial Public Offering which are subject to redemption, which, due to its impact on our financial statements, we determined to be a material weakness in our internal control over financial reporting. As a result of such re-classification, we restated our financial statements as of May 7, 2021 and as of and for the period ended June 30, 2021.

Our management has expended, and will continue to expend, a substantial amount of effort and resources for the remediation and improvement of our internal control over financial reporting. While we have processes to properly identify and evaluate the appropriate accounting technical pronouncements and other literature for all significant or unusual transactions, we have expanded and will continue to improve these processes to ensure that the nuances of such transactions are effectively evaluated in the context of the increasingly complex accounting standards.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

~~None.~~

To the knowledge of our management team, there is no litigation currently pending or contemplated against us, any of our officers or directors in their capacity as such or against any of our property.

Item 1A. Risk Factors.

As of the date of this Report, other than as set forth below, there have been no material changes with respect to those risk factors previously disclosed in our (i) Registration Statement on Form S-1 initially filed with the SEC on February 16, 2021, as amended, and declared effective on May 4, 2021 (File No. 333-253167) (the “Registration Statement”), (ii) Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on March 25, 2022, ~~and~~ (iii) Quarterly Reports on Form 10-Q for the quarters ended March 31, 2021 and 2022, as filed with the SEC on June 17, 2021 and May 10, 2022, ~~respectively.~~respectively, (iv) Quarterly Reports on Form 10-Q for the quarters ended June 30, 2021 and 2022, as filed with the SEC on August 23, 2021 and August16, 2022, respectively (iv) DEF 14A as filed with the SEC on October 14, 2022. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risks could arise that may also affect our business or ability to consummate an initial business combination. We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future filings with the SEC.

~~Changes~~

A new 1% U.S. federal excise tax could be imposed on us in connection with redemptions by us of our shares in connection with a business combination or other stockholder vote pursuant to ~~laws or regulations or in how such laws or regulations~~which stockholders would have a right to submit their shares for redemption (a “Redemption Event”).

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 (including redemptions) of stock by publicly traded domestic (i.e., U.S.) corporations and certain domestic subsidiaries of publicly traded foreign corporations. The excise tax is imposed on the repurchasing corporation itself, not its stockholders from which shares are ~~interpreted or applied, or a failure~~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 ~~comply with any laws, regulations, interpretations or applications, may adversely affect our business, including our ability to negotiate and complete our initial business combination.~~

~~We are subject~~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 ~~laws and~~excise tax. The U.S. Department of the Treasury (the “Treasury Department”) has been given authority to provide regulations and ~~interpretations~~other guidance to carry out, and ~~applications~~prevent the abuse or avoidance of ~~such laws and regulations, of national, regional, state and local governments and applicable non-U.S. jurisdictions. In particular, we are required~~the excise tax. The IR Act applies only to ~~comply~~repurchases that occur after December 31, 2022.

If the deadline for us to complete a business combination is extended, our public shareholders will have the right to require us to redeem their Public Shares. Any redemption or other repurchase that occurs after December 31, 2022, in connection with certain SEC and potentially other legal and regulatory requirements, and our consummation of an initial Business combination may be contingent upon our ability to comply with certain laws, regulations, interpretations and applications and any post-business combination companya Redemption Event may be subject to ~~additional laws, regulations, interpretations and applications. Compliance with, and monitoring of,~~ the foregoing may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time, and those changes could have a material adverse effect on our business, including our ability to negotiate and complete an initial business combination. A failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to negotiate and complete an initial business combination.

On March 30, 2022, the SEC issued proposed rules (the “SPAC Rule Proposals”) relating, among other items, to disclosures in SEC filings in connection with business combination transactions involving special purpose acquisition companies (“SPACs”) and private operating companies; the financial statement requirements applicable to transactions involving shell companies; the use of projections in SEC filings in connection with proposed business combination transactions; the potential liability of certain participants in proposed business combination transactions; and the extent to which SPACs could become subject to regulation under the Investment Company Act, including a proposed rule that would provide SPACs a safe harbor from treatment as an investment company if they satisfy certain conditions that limit a SPAC’s duration, asset composition, business purpose and activities. Certain of the procedures that we, a potential business combination target, or others may determine to undertake in connection with the SPAC Rule Proposals, as proposed or as adopted, or pursuant to the SEC’s views expressed in the SPAC Rule Proposals, may increase the costs and time of negotiating and completing an initial business combination, and may constrain the circumstances under which we could complete an initial business combination.

~~Table of Contents~~

The SEC has recently issued proposed rules relating to certain activities of SPACs. Certain of the procedures that we, a potential business combination target, or others may determine to undertake in connection with such proposals may increase our costs and the time needed to complete our initial business combination and may constrain the circumstances under which we could complete an initial business combination. The need for compliance with the SPAC Rule Proposals may cause us to liquidate the funds in the Trust Account or liquidate the Company at an earlier time than we might otherwise choose.

On March 30, 2022, the SEC issued the SPAC Rule Proposals relating, among other items, to disclosures in business combination transactions between SPACS such as us and private operating companies; the condensed financial statement requirements applicable to transactions involving shell companies; the use of projections by SPACs in SEC filings in connection with proposed business combination transactions; the potential liability of certain participants in proposed business combination transactions; and thewhat extent to which SPACs could become subject to regulation under the Investment Company Act, including a proposed rule that would provide SPACs a safe harbor from treatment as an investment company if they satisfy certain conditions that limit a SPAC’s duration, asset composition, business purpose and activities. The SPAC Rule Proposals have not yet been adopted, and may be adopted in the proposed form or in a different form that could impose additional regulatory requirements on SPACs. Certain of the procedures that we, a potential business combination target, or others may determine to undertake in connection with the SPAC Rule Proposals, or pursuant to the SEC’s views expressed in the SPAC Rule Proposals, may increase the costs and time of negotiating and completing an initial business combination, and may constrain the circumstances under which we could complete an initial business combination. The need for compliance with the SPAC Rule Proposals may cause us to liquidate the funds in the Trust Account or liquidate the Company at an earlier time than we might otherwise choose.

If we are deemed to be an investment company for purposes of the Investment Company Act, we would be required to institute burdensome compliance requirements and our activities would be severely restricted. As a result, in such circumstances, unless we are able to modify our activities so that we would not be deemed an investment company, we would expect to abandon our efforts to complete an initial business combination and instead to liquidate the Company.

As described further above, the SPAC Rule Proposals relate, among other matters, to the circumstances in which SPACs such as the Company 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, including 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 a business combination no later than 18 months after the effective date of its registration statement for its initial public offering (the “IPO Registration Statement”). The company would then be required to complete its initial business combination no later than 24 months after the effective date of the IPO Registration Statement.

Because the SPAC Rule Proposals have not yet been adopted, there is currently uncertainty concerning the applicability of the Investment Company Act to a SPAC that has not entered into a definitive agreement within 18 months after the effective date of the IPO Registration Statement or that does not complete its business combination within 24 months after such date.

~~If we are deemed to be an investment company under the Investment Company Act, our activities would be severely restricted. In addition,~~ we would be subject to ~~burdensome compliance requirements. We do~~the excise tax in connection with the Redemption Event would depend on a number of factors, including (i) the fair market value of the redemptions and repurchases in connection with the Redemption Event, (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 ~~believe that our principal activities will subject us to regulation as an investment company under~~in connection with the ~~Investment Company Act. However, if we are deemed to be an investment company~~Redemption Event but issued within the same taxable year of the business combination) and ~~subject to compliance with~~(iv) the content of regulations and ~~regulation under~~other guidance from the ~~Investment Company Act, we~~United States Treasury Department. In addition, because the excise tax would be ~~subject to additional regulatory burdens~~payable by us, and ~~expenses for which we~~not by the redeeming holder, the mechanics of any required payment of the excise tax have not ~~allotted funds. As~~been determined. The foregoing could cause a ~~result, unless we are able to modify our activities so that we would not be deemed an investment company, we would expect to abandon our efforts~~reduction in the cash available on hand to complete ~~an initial~~a business combination and ~~instead~~in our ability to ~~liquidate the Company.~~complete a business combination.

To mitigate the risk that we might be deemed to be an investment company for purposes of the Investment Company Act , we may, at any time, instruct the trustee to liquidate the securities held in the ~~Trust Account~~trust account and instead to hold the funds in the ~~Trust Account~~trust account in cash items until the earlier of the consummation of our initial business combination or our liquidation. As a result, following the liquidation of securities in the ~~Trust Account,~~trust account, we would likely receive minimal interest, if any, on the funds held in the ~~Trust Account,~~trust account, which would reduce the dollar amount our public stockholders would receive upon any redemption or liquidation of the Company.

The funds in the ~~Trust Account~~trust account have, since our initial public offering, 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. However, to mitigate the risk of us being deemed to be an unregistered investment company (including under the subjective test of Section 3(a)(1)(A) of the Investment Company Act) and thus subject to regulation under the Investment Company Act, we may, at any time, instruct Continental Stock Transfer & Trust Company, the trustee with respect to the ~~Trust Account,~~trust account, to liquidate the U.S. government treasury obligations or money market funds held in the ~~Trust Account~~trust account and thereafter to hold all funds in the ~~Trust Account in~~trust account as cash items until the earlier of the consummation of our initial business combination or the liquidation of the Company. Following such liquidation, we would likely receive minimal interest, if any, on the funds held in the ~~Trust Account.~~trust account. However, interest previously earned on the funds held in the ~~Trust Account~~trust account still may be released to us to pay our taxes, if ~~any, and certain other expenses as permitted.~~any. As a result, any decision to liquidate the securities held in the ~~Trust Account~~trust account and thereafter to hold all funds in the ~~Trust Account~~trust account in cash items would reduce the dollar amount our public stockholders would receive upon any redemption or liquidation of the Company.

In ~~addition, even prior to~~ the ~~24-month anniversary of the effective date of the Registration Statement,~~event that 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 treasury obligations or in money market funds invested exclusively in such securities, even prior to the 24-month anniversary, the greater the risk that we may be considered an unregistered investment company, ~~in which case~~ we may be required to liquidate the Company. 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 liquidation of the Company.

~~There is substantial doubt about our ability to continue as a “going concern.”~~

In connection with the Company’s assessment of going concern considerations under applicable accounting standards, management has determined that our possible need for additional financing to enable us to negotiate and complete our initial business combination, as well as the deadline by which we may be required to liquidate our Trust Account, raise substantial doubt about the Company’s ability to continue as a going concern through approximately one year from the date the financial statements included elsewhere in this Report were issued.

We have identified a material weakness in our internal control over financial reporting as of June 30, 2022. If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results.

We have identified a material weakness in our internal controls over financial reporting relating to properly evaluating complex equity transactions. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented, or detected and corrected on a timely basis.

Effective internal controls are necessary for us to provide reliable financial reports and prevent fraud. Measures to remediate material weaknesses may be time-consuming and costly and there is no assurance that such initiatives will ultimately have the intended effects. If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results. If we identify any new material weaknesses in the future, any such newly identified material weakness could limit our ability to prevent or detect a misstatement of our accounts or disclosures that could result in a material misstatement of our annual or interim financial statements. In such case, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports in addition to applicable stock exchange listing requirements, investors may lose confidence in our financial reporting and adversely affect our business and operating results. We cannot assure you that the measures we have taken to date, or any measures we may take in the future, will be sufficient to avoid potential future material weaknesses.

On May 7, 2021, we consummated our initial public offering of 16,000,000 units. Each unit consists of one share of Class A Common Stock and one-half of one public warrant, with each whole public warrant entitling the holder thereof to purchase one public share for $11.50 per share. The units were sold at a price of $10.00 per unit, generating gross proceeds to the Company of $160,000,000. On May 7, 2021, simultaneously with the consummation of our initial public offering, we completed the private sale of an aggregate of 551,000 units to our sponsor at a purchase price of $10.00 per private placement unit, generating gross proceeds of $5,510,000.

On May 10, 2021 the over-allotment was partially exercised and 1,309,719 additional units were sold at an offering price of $10.00 per unit, generating gross proceeds of $13,097,190. In connection with the exercise of the over-allotment option, the Company sold 32,743 private placement units to the Sponsor at a purchase price of $10.00 per private placement unit, generating gross proceeds of $327,430.

Following the closing of our initial public offering on May 7, 2021, $175,693,648 from the net proceeds of the sale of the units in our initial public offering, the exercise of the over-allotment option and the sale of the private placement units was placed in a trust account established for the benefit of our public stockholders and maintained by Continental Stock Transfer & Trust Company, as trustee. The proceeds held in the trust account may be invested by the trustee only in U.S. government securities 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.

There has been no material change in the planned use of the proceeds from our initial public offering and the private placement as is described in the Company’s final prospectus related to our initial public offering.

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	For the Three		For the Three		For the Six		For the Six
	Months Ended		Months Ended		Months Ended		Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
General and administrative expenses		230,682		174,834		407,064		175,559
Total expenses		230,682		174,834		407,064		175,559

Other income (expenses)
Unrealized gain (loss) on investment held in Trust Account		168,445		(14,486)		290,004		(14,486)
Offering costs allocated to warrants		—		(494,344)		—		(494,344)
Change in fair value of derivative liabilities		806,665		6,976,878		3,604,499		6,976,878
Unrealized gain on fair value of debt		1,362,630				1,362,630
Total other income		2,337,740		6,468,048		5,257,133		6,468,048
Net income	$	2,107,058	$	6,293,214	$	4,850,069	$	6,292,489
Weighted average shares outstanding of Class A Common Stock, basic and diluted		17,893,462		10,544,337		17,893,462		5,832,251
Basic and diluted net income per share - Class A Common Stock	$	0.09	$	0.35	$	0.22	$	0.58
Weighted average shares outstanding of Class B Common Stock, basic and diluted (1) (2)		4,500,528		766,485		4,500,528		4,569,913
Basic and diluted net income per share - Class B Common Stock	$	0.09	$	0.35	$	0.22	$	0.58


	Class A			Class B			Additional
	Common Stock			Common Stock			Paid-In		Accumulated		Stockholders’ equity
	Shares	Amount		Shares	Amount		Capital		Deficit		(Deficit)
Balance as of January 1, 2021	0	$	0	0	$	0	$	0	$	0	$	0

Issuance of Class B common stock to Sponsor (1)(2)	—		—	4,600,000		460		24,540		—		25,000

Net loss	—		—	—		—		—		(725)		(725)

Balance as of March 31, 2021	—		—	4,600,000		460		24,540		(725)		24,275

Forfeiture of Class B common stock	—		—	(272,570)		(27)		27		—		—

Accretion of Class A common stock to redemption value	583,723		58	173,098		17		(24,567)		(15,568,917)		(15,593,409)

Net income	—		—	—		—		—		6,293,214		6,293,214

Balance as of June 30, 2021	583,723	$	58	4,500,528	$	450	$	—	$	(9,276,428)	$	(9,275,920)


	For the Six		For the Six
	Months Ended		Months Ended
	June 30, 2022		June 30, 2021
Cash Flows From Operating Activities:
Net income	$	4,850,069	$	6,292,489
Adjustments to reconcile net income to net cash used in operating activities:
Unrealized gains (losses) on investments held in the Trust Account		(290,004)		14,486
Offering costs allocated to warrants		—		494,344
Change in fair value of derivative liabilities		(3,604,499)		(6,976,878)
Unrealized gain on fair value of debt		(1,362,630)		—
Changes in operating assets and liabilities:
Prepaid expenses		78,750		(286,550)
Accounts payable and accrued expenses		(94,604)		157,113
Net Cash Used In Operating Activities		(422,917)		(304,996)

Cash Flows From Investing Activities:
Cash deposited into Trust Account		(1,730,972)		(175,693,648)
Net Cash Used In Financing Activities		(1,730,972)		(175,693,648)

Cash Flows From Financing Activities:
Sale of Units in the Initial Public Offering, net of underwriting discount		—		171,366,206
Sale of Private Placement Units to Sponsor		—		5,837,430
Proceeds from the Sponsor promissory note		—		177,111
Repayment of the Sponsor promissory note		—		(177,111)
Payment of offering costs		—		(584,409)
Proceeds from issuance of debt to Sponsor		1,730,972		—
Proceeds from issuance of Class B common stock to Sponsor		—		25,000
Net Cash Provided By Financing Activities		1,730,972		176,643,639

Net change in cash		(422,917)		644,995

Cash at beginning of period		475,500		—

Cash at end of period	$	52,583	$	644,995

Supplemental disclosure of non-cash financing activities:
Initial value of Class A Common Stock subject to possible redemption		—	$	175,693,648
Deferred underwriting compensation charged to additional paid-in capital in connection with the Initial Public Offering		—	$	5,192,916
Initial classification of fair value of over allotment liability		—	$	162,847
Initial classification of fair value of warrants		—	$	11,760,676

	For the Nine			For the Nine
	Months Ended			Months Ended
	September 30, 2022			September 30, 2021
Cash Flows From Operating Activities:
Net income	$	7,236,403		$	6,023,744
Adjustments to reconcile net income to net cash used in operating activities:
Unrealized (gains) losses on investments held in the Trust Account		(1,108,337	)		(11,920	)
Offering costs allocated to warrants		—			494,344
Change in fair value of derivative liabilities		(4,235,097	)		(6,799,986	)
Unrealized gain on fair value of debt		(2,759,970	)		—
Changes in operating assets and liabilities:
Prepaid expenses		102,125			(247,165	)
Accounts payable and accrued expenses		177,233			212,774
Net Cash Used In Operating Activities		(587,643	)		(328,209	)

Cash Flows From Investing Activities:
Cash withdrawn from the Trust Account		361,500			-
Cash deposited into Trust Account		(3,461,944	)		(175,693,648	)
Net Cash Used In Financing Activities		(3,100,444	)		(175,693,648	)

Cash Flows From Financing Activities:
Sale of Units in the Initial Public Offering, net of underwriting discount		—			171,366,218
Sale of Private Placement Units to Sponsor		—			5,837,430
Proceeds from the Sponsor promissory note		—			177,111
Repayment of the Sponsor promissory note		—			(177,111	)
Return of excess private placement funds to Sponsor		—			(124,900	)
Payment of offering costs		—			(584,409	)
Proceeds from issuance of debt to Sponsor		3,461,944			—
Proceeds from issuance of Class B common stock to Sponsor		—			25,000
Net Cash Provided By Financing Activities		3,461,944			176,519,339

Net change in cash		(226,143	)		497,482

Cash at beginning of period		475,500			—

Cash at end of period	$	249,357		$	497,482

Supplemental disclosure of cash payments:
Cash paid for taxes	$	—		$	—

Supplemental disclosure of non-cash financing activities:
Initial value of Class A Common Stock subject to possible redemption	$	—		$	175,693,648
Remeasurement of Class A common stock subject to possible redemption	$	581,197		$	—
Deferred underwriting compensation charged to additional paid-in capital in connection with the Initial Public Offering	$	—		$	5,192,916
Initial classification of fair value of warrants	$	—		$	11,760,676

No.		Description of Exhibit
31.1* 3.1		First Amendment to The Amended and Restated Certificate of Incorporation, dated November 4, 2022 (Incorporated by reference to the Company’s Form 8-K, filed with the SEC on November 9, 2022).
31.1*		Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2**		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*		Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*		Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit)


	June 30, 2022		December 31, 2021
	(unaudited)
ASSETS
Current asset
Cash and cash equivalents	$	52,583	$	475,500
Prepaid expenses		129,050		157,500
Total current assets		181,633		633,000

Other assets		—		50,300
Investments held in the Trust Account		177,740,015		175,719,039
Total Assets	$	177,921,648	$	176,402,339

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Accounts payable and accrued expenses	$	231,832	$	326,436
Note payable – Sponsor at fair value (cost: $1,730,972 and $0)		368,342		—
Total current liabilities		600,174		326,436

Deferred underwriting compensation		5,192,916		5,192,916
Warrant liability - Private Placement Warrants		29,188		182,128
Warrant liability - Public Warrants		865,486		4,317,044
Total liabilities		6,687,764		10,018,524

Commitments and Contingencies (Note 5)
Class A Common Stock subject to possible redemption; 17,309,739 shares at redemption value of $10.25 and $10.15 per share		177,424,608		175,693,636

Stockholders’ Deficit
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; NaN issued and outstanding		—		—
Class A common stock, $0.0001 par value; 100,000,000 shares authorized; 583,723 issued and outstanding (excluding 17,309,739 shares subject to possible redemption)		58		58
Class B common stock, par value $0.0001; 10,000,000 shares authorized; 4,500,528 issued and outstanding		450		450
Accumulated deficit		(6,191,232)		(9,310,329)
Total Stockholders’ Deficit		(6,190,724)		(9,309,821)
Total Liabilities and Stockholders’ Deficit	$	177,921,648	$	176,402,339

	For the Three			For the Three			For the Nine			For the Nine
	Months Ended			Months Ended			Months Ended			Months Ended
	September 30, 2022			September 30, 2021			September 30, 2022			September 30, 2021
General and administrative expenses		257,417			118,259			664,481			293,818
Total expenses		257,417			118,259			664,481			293,818

Other income (expense)
Unrealized gain (loss) on investment held in Trust Account		818,333			26,406			1,108,337			11,920
Offering costs allocated to warrants		-			-			-			(494,344	)
Change in fair value of derivative liabilities		630,598			(176,892	)		4,235,097			6,799,986
Unrealized gain on fair value of debt		1,397,351			-			2,759,981			-
Total other income (expense)		2,846,282			(150,486	)		8,103,415			6,317,562
Pre tax income (loss)		2,588,865			(268,745	)		7,438,934
Income tax		(202,531	)		-			(202,531	)		-
Net income (loss)	$	2,386,334		$	(268,745	)	$	7,236,403		$	6,023,744
Weighted average shares outstanding of Class A Common Stock, basic and diluted		17,893,462			17,893,462			17,893,462			10,534,895
Basic and diluted net income per share - Class A Common Stock	$	0.11		$	(0.01	)	$	0.32		$	0.40
Weighted average shares outstanding of Class B Common Stock, basic and diluted		4,500,528			4,500,598			4,500,528			4,546,468
Basic and diluted net income per share - Class B Common Stock	$	0.11		$	(0.01	)	$	0.32		$	0.40

	Class A Common Stock				Class B Common Stock				Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Deficit			(Deficit)
Balance as of January 1, 2022		583,743	$	58		4,500,528	$	450	$	(9,310,329	)	$	(9,309,821	)

Net income		—		—		—		—		2,743,011			2,743,011

Balance as of March 31, 2022		583,743		58		4,500,528		450		(6,567,318	)		(6,566,810	)

Remeasurement of Class A common stock to redemption value		—		—		—		—		(1,730,972	)		(1,730,972	)

Net income		—		—		—		—		2,107,058			2,107,058

Balance as of June 30, 2022		583,743		58		4,500,528		450		(6,191,232	)		(6,190,724	)

Remeasurement of Class A common stock to redemption value		—		—		—		—		(2,312,169	)		(2,312,169	)

Net income		—		—		—		—		2,386,334			2,386,334

Balance as of September 30, 2022		583,743	$	58		4,500,528	$	450	$	(6,117,067	)	$	(6,116,559	)

	Class A Common Stock				Class B Common Stock						Additional Paid-In			Accumulated			Stockholders’ Equity
	Shares		Amount		Shares			Amount			Capital			Deficit			(Deficit)
Balance as of January 1, 2021		—	$	—		—		$	—		$	—		$	—		$	—

Issuance of Class B common stock to Sponsor		—		—		4,600,000			460			24,540			—			25,000

Net loss		—		—		—			—			—			(725	)		(725	)

Balance as of March 31, 2021		—		—		4,600,000			460			24,540			(725	)		24,275

Forfeiture of Class B common stock		—		—		(272,570	)		(27	)		27			—			—

Accretion of Class A common stock to redemption value		583,743		58		173,098			17			(24,567	)		(15,509,776	)		(15,534,268	)

Net income		—		—		—			—			—			6,293,214			6,293,214

Balance as of June 30, 2021		583,743		58		4,500,528			450			—			(9,217,287	)		(9,216,779	)

Return of private placement funds to Sponsor		—		—		—			—			—			(124,289	)		(124,289	)

Net loss		—		—		—			—			—			(268,745	)		(268,745	)

Balance as of September 30, 2021		583,743	$	58		4,500,528		$	450		$	-		$	(9,610,321	)	$	(9,609,813	)


	For the Three Months				For the Six Months
	Ended June 30, 2022				Ended June 30, 2022
	Class A		Class B		Class A		Class B
Basic and diluted net income per share
Numerator:
Allocation of net income	$	1,685,646	$	421,412	$	3,875,305	$	974,764
Denominator:
Basic and diluted weighted average shares outstanding		17,893,462		4,500,528		17,893,462		4,500,528

Basic and diluted net income per share	$	0.09	$	0.09	$	0.22	$	0.22


	For the Three Months				For the Six Months
	Ended June 30, 2021				Ended June 30, 2021
	Class A		Class B		Class A		Class B
Basic and diluted net income per share
Numerator:
Allocation of net income	$	5,871,391	$	421,823	$	3,528,052	$	2,764,437
Denominator:
Basic and diluted weighted average shares outstanding		10,544,337		766,485		5,832,251		4,559,913

Basic and diluted net income per share	$	0.35	$	0.35	$	0.58	$	0.58


	June 30, 2022		December 31, 2021		May 7, 2021
Risk-free interest rate	3.01	%	0.32-1.26	%	0.8	%
Expected life of grants	5.33	years	5	years	5.0	years
Expected volatility of underlying stock	0	%	5-12	%	20	%
Dividends	0	%	0	%	0	%
Probability of Business Combination	80	%	80	%	80	%


Description	Level	June 30, 2022		December 31, 2021
Assets:
Marketable securities held in the Trust Account	1	$	177,740,015	$	175,719,039

Liabilities:
Note payable – Sponsor	3	$	368,342		—
Warrant Liability – Private Placement Warrants	3	$	29,188	$	182,128
Warrant Liability – Public Warrants	1	$	865,486	$	4,317,045

	MAQUIA CAPITAL ACQUISITION CORPORATION

Date: November 10, 2022	By:
~~Date: August 16, 2022~~	~~By:~~	/s/ Jeff Ransdell
	Name:	Jeff Ransdell
	Title:	Chief Executive Officer
		(Principal Executive Officer)

Date: November 10, 2022	By:
~~Date: August 16, 2022~~	~~By:~~	/s/ Jeronimo Peralta
	Name:	Jeronimo Peralta
	Title:	Chief Financial Officer
		(Principal Accounting and Financial Officer)