Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 16, 2022 | |
Document Information Line Items | ||
Entity Registrant Name | KLUDEIN I ACQUISITION CORP | |
Trading Symbol | INKA | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false | |
Entity Central Index Key | 0001826671 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Shell Company | true | |
Entity Ex Transition Period | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-39843 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 85-3187587 | |
Entity Address, Address Line One | 1096 Keeler Avenue | |
Entity Address, City or Town | Berkeley | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94708 | |
City Area Code | (650) | |
Local Phone Number | 246-9907 | |
Title of 12(b) Security | Class A common stock, par value $0.0001 per share | |
Security Exchange Name | NASDAQ | |
Entity Interactive Data Current | Yes | |
Class A Common Stock | ||
Document Information Line Items | ||
Entity Common Stock, Shares Outstanding | 17,250,000 | |
Class B Common Stock | ||
Document Information Line Items | ||
Entity Common Stock, Shares Outstanding | 4,312,500 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash | $ 43,339 | $ 400,073 |
Prepaid expenses | 202,919 | |
Total current assets | 246,258 | 400,073 |
Cash and marketable securities held in Trust Account | 172,620,428 | 172,580,609 |
TOTAL ASSETS | 172,866,686 | 172,980,682 |
Current liabilities | ||
Accounts payable and accrued expenses | 774,400 | 637,375 |
Total current liabilities | 774,400 | 637,375 |
Convertible promissory note – related party (at fair value) | 259,500 | |
Warrant liabilities | 1,935,500 | 8,311,710 |
Deferred underwriting fee payable | 6,037,500 | 6,037,500 |
Total Liabilities | 9,006,900 | 14,986,585 |
Commitments and contingencies | ||
Class A common stock subject to possible redemption; 17,250,000 shares at redemption value of $10 as of March 31, 2022 and December 31, 2021 | 172,500,000 | 172,500,000 |
Stockholders’ Deficit | ||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding | ||
Class A common stock, $0.0001 par value; 280,000,000 shares authorized; none issued or outstanding (excluding 17,250,000 shares subject to possible redemption at March 31, 2022 and December 31, 2021) | ||
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 4,312,500 shares issued and outstanding as of March 31, 2022 and December 31, 2021 | 431 | 431 |
Accumulated deficit | (8,640,645) | (14,506,334) |
Total Stockholders’ Deficit | (8,640,214) | (14,505,903) |
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ 172,866,686 | $ 172,980,682 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parentheticals) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Preferred stock par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Class A Common Stock | ||
Subject to possible redemption, shares | 17,250,000 | 17,250,000 |
Subject to possible redemption value (in Dollars per share) | $ 10 | $ 10 |
Common stock par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 280,000,000 | 280,000,000 |
Common stock, shares issued | ||
Common stock, shares outstanding | ||
Class B Common Stock | ||
Common stock par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, shares issued | 4,312,500 | 4,312,500 |
Common stock, shares outstanding | 4,312,500 | 4,312,500 |
Condensed Statements of Operati
Condensed Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Formation and operational costs | $ 640,840 | $ 333,548 |
Loss from operations | (640,840) | (333,548) |
Other income (expense): | ||
Transaction costs allocated to warrants | (523,013) | |
Change in fair value of warrant liabilities | 6,376,210 | 2,212,000 |
Change in fair value of convertible promissory note – related party | 5,400 | |
Interest earned on marketable securities held in Trust Account | 41,450 | 33,277 |
Unrealized loss on marketable securities held in Trust Account | (1,631) | (616) |
Total other income, net | 6,421,429 | 1,721,648 |
Net income | $ 5,780,589 | $ 1,388,100 |
Class A Common Stock | ||
Other income (expense): | ||
Basic weighted average shares outstanding (in Shares) | 17,250,000 | 15,141,667 |
Basic net income per share (in Dollars per share) | $ 0.27 | $ 0.07 |
Diluted weighted average shares outstanding (in Shares) | 17,250,000 | 15,141,667 |
Diluted net income per share (in Dollars per share) | $ 0.27 | $ 0.07 |
Class B Common Stock | ||
Other income (expense): | ||
Basic weighted average shares outstanding (in Shares) | 4,312,500 | 4,243,750 |
Basic net income per share (in Dollars per share) | $ 0.27 | $ 0.07 |
Diluted weighted average shares outstanding (in Shares) | 4,312,500 | 4,312,500 |
Diluted net income per share (in Dollars per share) | $ 0.27 | $ 0.07 |
Condensed Statements of Changes
Condensed Statements of Changes in Stockholders’ Equity (Deficit) (Unaudited) - USD ($) | Class BCommon Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2020 | $ 431 | $ 24,569 | $ (1,893) | $ 23,107 |
Balance (in Shares) at Dec. 31, 2020 | 4,312,500 | |||
Cash paid in excess of fair value for Private Placement Warrants | 1,456,000 | 1,456,000 | ||
Fair value of Founders Shares attributable to Anchor Investor | 4,411,238 | 4,411,238 | ||
Re-measurement of Class A common stock to redemption amount | (5,891,807) | (14,098,415) | (19,990,222) | |
Net income | 1,388,100 | 1,388,100 | ||
Balance at Mar. 31, 2021 | $ 431 | (12,712,208) | (12,711,777) | |
Balance (in Shares) at Mar. 31, 2021 | 4,312,500 | |||
Balance at Dec. 31, 2021 | $ 431 | (14,506,334) | (14,505,903) | |
Balance (in Shares) at Dec. 31, 2021 | 4,312,500 | |||
Proceeds in excess of fair value of convertible note on issuance date | 85,100 | 85,100 | ||
Net income | 5,780,589 | 5,780,589 | ||
Balance at Mar. 31, 2022 | $ 431 | $ (8,640,645) | $ (8,640,214) | |
Balance (in Shares) at Mar. 31, 2022 | 4,312,500 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash Flows from Operating Activities: | ||
Net income | $ 5,780,589 | $ 1,388,100 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Interest earned on marketable securities held in Trust Account | (41,450) | (33,277) |
Unrealized loss on marketable securities held in Trust Account | 1,631 | 616 |
Change in fair value of warrant liabilities | (6,376,210) | (2,212,000) |
Change in fair value of convertible promissory note – related party | (5,400) | |
Transaction costs allocated to warrants | 523,013 | |
Prepaid expenses | (202,919) | (542,534) |
Accounts payable and accrued expenses | 137,025 | 136,690 |
Due to Sponsor | (1,000) | |
Net cash used in operating activities | (706,734) | (740,392) |
Cash Flows from Investing Activities: | ||
Investment of cash in Trust Account | (172,500,000) | |
Net cash used in investing activities | (172,500,000) | |
Cash Flows from Financing Activities: | ||
Proceeds from sale of Units, net of underwriting discounts paid | 169,049,999 | |
Proceeds from sale of Private Placement Warrants | 5,200,000 | |
Proceeds from promissory note – related party | 5,000 | |
Proceeds from convertible promissory note – related party | 350,000 | |
Repayment of promissory note – related party | (88,905) | |
Payment of offering costs | (271,352) | |
Net cash provided by financing activities | 350,000 | 173,894,742 |
Net Change in Cash | (356,734) | 654,350 |
Cash – Beginning of period | 400,073 | 1,000 |
Cash – End of period | 43,339 | 655,350 |
Non-Cash investing and financing activities: | ||
Offering costs included in accrued offering costs | 214,852 | |
Fair value of Founder Shares attributable to Anchor Investor | 4,411,238 | |
Proceeds in excess of fair value of convertible note on issuance date | 85,100 | |
Deferred underwriting fee payable | 6,037,500 | |
Remeasurement of Class A common stock subject to possible redemption | $ 19,990,222 |
Description of Organization and
Description of Organization and Business Operations | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS | NOTE 1 — DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS KludeIn I Acquisition Corp. (the “Company”) is a blank check company incorporated in Delaware on September 24, 2020. The Company was formed for the purpose of effectuating a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses (the “Business Combination”). The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. As of March 31, 2022, the Company had not commenced any operations. All activity through March 31, 2022 relates to the Company’s formation and the initial public offering (the “Initial Public Offering”), which is described 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 the completion of a Business Combination, at the earliest. The Company generates non-operating income in the form of interest income and unrealized gains from the marketable securities held in the Trust Account (as defined below), and gains or losses from the change in fair value of the warrant liabilities and convertible promissory note. The registration statement for the Company’s Initial Public Offering was declared effective on January 6, 2021. On January 11, 2021, the Company consummated the Initial Public Offering of 17,250,000 units (the “Units” and, with respect to the shares of Class A common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriter of its over-allotment option in the amount of 2,250,000 Units, at $10.00 per Unit, generating gross proceeds of $172,500,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 5,200,000 warrants (each, a “Private Placement Warrant” and, collectively, the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant in a private placement to KludeIn Prime LLC (the “Sponsor”), generating gross proceeds of $5,200,000, which is described in Note 4. The Company incurred $14,303,235 in transaction costs, including $3,450,000 of underwriting fees, $6,037,500 of deferred underwriting fees, $4,411,238 of fair value of the Founder Shares (defined below) attributable to the Anchor Investor (defined below) and $404,497 of other offering costs. Transaction costs allocated to the warrants were $523,013 and were expensed in the accompanying condensed statement of operations for the period ended March 31, 2021. Following the closing of the Initial Public Offering on January 11, 2021, an amount of $172,500,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the “Trust Account”), invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less, or in any open-ended investment company that holds itself out as a money market fund meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the consummation of a Business Combination or (ii) the distribution of the funds in the Trust Account to the Company’s stockholders, as described below. The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. Nasdaq Capital Markets rules provide that the Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (less any deferred underwriting commissions and taxes payable on interest earned on the Trust Account) at the time of the signing a definitive 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. There is no assurance that the Company will be able to successfully effect a Business Combination. The Company will provide its holders of the outstanding Public Shares (the “public 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. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.00 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants. The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 either prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business or other reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by law, or the Company decides to obtain stockholder approval for business or other reasons, the Company will offer to redeem the Public Shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the Sponsor has agreed to vote its Founder Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares, without voting, and if they do vote, irrespective of whether they vote for or against the proposed Business Combination. Notwithstanding the above, if the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Amended and Restated Certificate of Incorporation 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 redeeming its Public Shares with respect to more than an aggregate of 15% or more of the Public Shares, without the prior consent of the Company. The Sponsor has agreed (a) to waive its redemption rights with respect to its Founder Shares and Public Shares held by it in connection with the completion of a Business Combination, (b) to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination by July 11, 2022 and (c) not to propose an amendment to the Amended and Restated Certificate of Incorporation (i) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial Business Combination or to redeem 100% of its Public Shares if the Company does not complete a Business Combination or (ii) with respect to any other provision relating to stockholders’ rights or pre-initial Business Combination activity, unless the Company provides the public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment. The Company will have until July 11, 2022 to complete a Business Combination (the “Combination Period”). If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Period. The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor acquires Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00). In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (1) $10.00 per Public Share or (2) the actual amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (except the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. Liquidity and Going Concern As of March 31, 2022, the Company had $43,339 in its operating bank accounts, $172,620,428 in and cash securities held in the Trust Account to be used for a Business Combination or to repurchase or redeem its common stock in connection therewith and working capital deficit of $478,142, which excludes $50,000 of interest earned on Trust which is available to pay Delaware franchise taxes payable. As of March 31, 2022, approximately $120,000 of the amount on deposit in the Trust Account represented interest income, which is available to pay the Company’s tax obligations and up to $100,000 of dissolution expenses. Until the consummation of a Business Combination, the Company has used and will be using the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to acquire, and structuring, negotiating and consummating the Business Combination. In order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. If the Company completes a Business Combination, it may repay the notes out of the proceeds of the Trust Account released to it. In the event that a Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay the notes, but no proceeds from our Trust Account would be used for such repayment. On January 21, 2022, the Company issued a promissory note with respect to the Working Capital Loans in the principal amount of up to $1,500,000 to the Sponsor. On January 31, 2022, the Company drew $350,000 on the Working Capital Loan. On April 1, 2022, the Company drew an additional $112,500 on the Working Capital Loan. The Working Capital Loan is non-interest bearing and payable upon the consummation of a Business Combination or may be convertible into warrants of the post-Business Combination entity at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants (see Note 8). In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standards Board’s Accounting Standards Codification Subtopic 205-40, “Presentation of Financial Statements – Going Concern,” the Company has until July 11, 2022, to consummate an initial 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. Additionally, the Company may not have sufficient liquidity to fund the working capital needs of the Company through one year from the issuance of these condensed financial statements. Management has determined that the liquidity condition and mandatory liquidation, should an initial Business Combination not occur, and potential subsequent dissolution raises substantial doubt about the Company’s ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after July 11, 2022. Risks and Uncertainties Management continues to evaluate 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 and/or search for a target company, the specific impact is not readily determinable as of the date of the condensed financial statements. The condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty. In February 2022, the Russian Federation and Belarus commenced a military action with the country of Ukraine. As a result of this action, various nations, including the United States, have instituted economic sanctions against the Russian Federation and Belarus. Further, the impact of this action and related sanctions on the world economy are not determinable as of the date of these financial statements. The specific impact on the Company’s financial condition, results of operations, and cash flows is also not determinable as of the date of these financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed 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 management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on April 12, 2022. The accompanying condensed balance sheet as of December 31, 2021 has been derived from the audited financial statements included in that annual report. The interim results for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future periods. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of condensed 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 condensed financial statements and the reported amounts of income and expenses during the reporting periods. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the condensed financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly 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 did not have any cash equivalents as of March 31, 2022 and December 31, 2021. Marketable Securities Held in Trust Account At March 31, 2022 and December 31, 2021, substantially all of the assets held in the Trust Account were primarily invested in U.S. Treasury securities. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the condensed balance sheets at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in the Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying condensed statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. Class A Common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in ASC Topic 480, “Distinguishing Liabilities from Equity.” Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including Class A common stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s condensed balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the re-measurement from initial carrying value to redemption amount, which approximates fair 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 during the three months ended March 31, 2021. There were no changes in the carrying value of redeemable Class A common stock during the three months ended March 31, 2022. At March 31, 2022 and December 31, 2021, the shares of Class A common stock reflected in the condensed balance sheet as temporary equity were reconciled in the following table: Gross proceeds for the Initial Public Offering $ 172,500,000 Less: Proceeds allocated to the initial fair value of Public Warrants (6,210,000 ) Class A common stock issuance costs (9,527,789 ) Fair value of Founder Shares attributable to Anchor Investor allocated to redeemable Class A common stock, net of allocated transaction costs (4,252,433 ) Plus: Re-measurement of carrying value to redemption value 19,990,222 Class A common stock subject to possible redemption $ 172,500,000 Warrant Liabilities The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480, and ASC 815, “Derivatives and Hedging” (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own shares of common stock, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the condensed statements of operations. For the Private Placement Warrants, the fair value was estimated using a binomial lattice model incorporating the Cox-Ross-Rubenstein methodology since the closing date of Initial Public Offering and as of March 31, 2022 (see Note 9). For the public warrants, the fair value was estimated using a binomial lattice model incorporating the Cox-Ross-Rubenstein methodology at the closing date of Initial Public Offering and the level 1 quoted prices in an active market since the public warrants starting trading separately on March 1, 2021 and Convertible Instruments The Company evaluated the accounting for its promissory notes that feature conversion options in accordance with ASC 815, Derivatives and Hedging Activities (“ASC 815”). ASC 815 requires companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments according to certain criteria. The criteria includes circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) a promissory note that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. However, the Company has elected to account for its promissory notes at fair value, as described in Note 9. Allocation of issuance costs The Company accounts for the allocation of its issuance costs to its warrants using the guidance in ASC Topic 470-20, “Debt with Conversion and Other Options” (“ASC 470-20), applied by analogy. Under this guidance, if debt or stock is issued with detachable warrants, the proceeds need to be allocated to the two instruments using either the fair value method, the relative fair value method, or the residual value method. The guidance also requires companies to use a consistent approach in allocating issuance costs between the instruments. Accordingly, the Company allocated its issuance costs of $14,303,235—consisting of $3,450,000 of underwriting fees, $6,037,500 of deferred underwriting commissions, $4,411,238 of fair value of the Founder Shares attributable to the Anchor Investor, and $404,497 of other offering costs—to the issuance of its Class A common stock and warrants in the amount of $13,780,222 and $523,013, respectively. Issuance costs attributed to the warrants were expensed to the condensed statement of operations during the three months ended March 31, 2021. Issuance costs attributed to the Class A common stock were initially charged to temporary equity and then re-measured to Class A common stock subject to redemption upon completion of the Initial Public Offering. Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the condensed financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. As of March 31, 2022 and December 31, 2021, the Company has provided a full valuation allowance against its net deferred tax assets. ASC 740 prescribes a recognition threshold and a measurement attribute for the condensed 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 recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2022 and December 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. For interim periods, the income tax provision or benefit related to ordinary income or loss is computed at an estimated annual effective income tax rate and the income tax provision or benefit related to all other items is individually computed and recognized when the items occur. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2022 and 2021, due primarily to the permanent differences. The permanent differences relate primarily to the change in fair value of warrant liabilities and convertible notes. Net Income per Share of Common Stock The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. Net income per share of common stock is computed by dividing net income by the weighted average number of shares of common stock outstanding for the period. The Company applies the two-class method in calculating income per share of common stock. Re-measurement associated with the redeemable shares of Class A common stock is excluded from income per share of common stock as the redemption value approximates fair value. Net income is allocated among the classes of common stock based on weighted average shares outstanding. The calculation of diluted income 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 13,825,000 shares of Class A common stock in the aggregate, not including warrants that may be acquired from the conversion feature in the Convertible Promissory Note. As of March 31, 2022 and 2021, the Company did not have any other 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 per share of common stock is the same as basic net income per share of common stock for the periods presented. Founder Shares subject to forfeiture (see Note 5) are not included in weighted average shares outstanding for basic net income per share until the forfeiture restrictions lapse, however, they are included in weighted average shares outstanding for diluted net income per share for the entire period. The following table reflects the calculation of basic and diluted net income per share of common stock (in dollars, except share amounts): For the Three Months Ended For the Three Months Ended Class A Class B Class A Class B Basic net income per share of common stock Numerator: Allocation of net income $ 4,624,471 $ 1,156,118 $ 1,084,225 $ 303,875 Denominator: Basic weighted average shares outstanding 17,250,000 4,312,500 15,141,667 4,243,750 Basic net income per share of common stock $ 0.27 $ 0.27 $ 0.07 $ 0.07 Diluted net income per share of common stock Numerator: Allocation of net income $ 4,624,471 $ 1,156,118 $ 1,084,225 $ 303,875 Denominator: Diluted weighted average shares outstanding 17,250,000 4,312,500 15,141,667 4,312,500 Diluted net income per share of common stock $ 0.27 $ 0.27 $ 0.07 $ 0.07 Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations 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. The Company has not experienced losses on these accounts. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the Company’s condensed balance sheets, primarily due to their short-term nature, except for warrants (see Note 9). Recent Accounting Standards 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 condensed financial statements. |
Initial Public Offering
Initial Public Offering | 3 Months Ended |
Mar. 31, 2022 | |
Public Offering [Abstract] | |
INITIAL PUBLIC OFFERING | NOTE 3 — INITIAL PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 17,250,000 Units, which includes a full exercise by the underwriters of their over-allotment option in the amount of 2,250,000 Units, at a purchase price of $10.00 per Unit. Each Unit consists of one share of the Company’s Class A common stock and one-half of one redeemable warrant (“Public Warrant”). Each Whole Public Warrant entitles the holder to purchase one share of Class A common stock at an exercise price of $11.50 per whole share (see Note 8). |
Private Placement Warrants
Private Placement Warrants | 3 Months Ended |
Mar. 31, 2022 | |
Private Placement Warrants [Abstract] | |
PRIVATE PLACEMENT WARRANTS | NOTE 4 — PRIVATE PLACEMENT WARRANTS Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 5,200,000 Private Placement Warrants at a price of $1.00 per Private Placement Warrant ($5,200,000 in the aggregate), in a private placement. Certain qualified institutional buyers or institutional accredited investors (“Anchor Investor”) purchased an aggregate of 780,000 Private Placement Warrants from the Sponsor at a price of $1.00 per Private Placement Warrant ($780,000 in the aggregate). As a result, the Sponsor and Anchor Investor held 4,420,000 and 780,000 Private Placement Warrants, respectively. Each Private Placement Warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share. The proceeds from the sale of the Private Placement Warrants were added to the net 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 Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless. As a result of the difference in the initial fair value of $0.72 per warrant of the Private Placement Warrants and the purchase price of $1.00 per share, the Company recorded a contribution to additional paid-in capital of $1,456,000 as of the date of the Private Placement issuance which is included in the condensed statements of stockholders’ equity for the three months ended March 31, 2021. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 5 — RELATED PARTY TRANSACTIONS Founder Shares On September 24, 2020, the Sponsor paid $25,000 to cover certain offering costs of the Company in consideration for 4,312,500 shares of Class B common stock (the “Founder Shares”). On January 6, 2021, the Sponsor transferred an aggregate of 75,000 Founder Shares to the Company’s director nominees. These 75,000 Founder Shares were not subject to forfeiture in the event the underwriter’s over-allotment option was not exercised. The Founder Shares included an aggregate of up to 562,500 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Sponsor would collectively own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering (assuming the Sponsor did not purchase any Public Shares in the Initial Public Offering). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares were forfeited, and none are currently subject to forfeiture. The Sponsor and its director nominees have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) subsequent to a Business Combination, (x) if the last sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. In connection with the closing of the Initial Public Offering, the Anchor Investor acquired from the Sponsor an indirect economic interest in an aggregate of 635,625 Founder Shares at the original purchase price that the Sponsor paid for the Founder Shares. The Sponsor has agreed to distribute such Founder Shares to the Anchor Investor after the completion of a Business Combination. The Company estimated the aggregate fair value of the Founder Shares attributable to the Anchor Investor to be $4,411,238, or $6.94 per share. The fair value of the Founder Shares was estimated using the income approach. The excess of the fair value of the Founder Shares was determined to be an offering cost in accordance with Staff Accounting Bulletin Topic 5A and Topic 5T. Accordingly, the offering cost was allocated to the separable financial instruments issued in the Initial Public Offering using the with-and-without method, compared to total proceeds received. Offering costs related to the Founder Shares amounted to a contribution to additional paid-in capital $4,411,238, of which $158,805 were expensed to the statement of operations and included in transaction costs attributable to warrant liabilities and the remaining $4,252,433 recorded as an additional offering cost as a reduction of temporary equity, and re-measured to accumulated deficit upon recording temporary equity at redemption value during the three months ended March 31, 2021. The transfer of the Founders Shares to the Company’s director nominees, as described above, is within the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The Founders Shares were effectively transferred subject to a performance condition (i.e., the occurrence of a Business Combination). Compensation expense related to the Founders Shares and common stock purchase warrants is recognized only when the performance condition is probable of occurrence under the applicable accounting literature in this circumstance. Stock-based compensation would be recognized at the date a Business Combination is considered probable in an amount equal to the number of Founders Shares times the grant date fair value per share (unless subsequently modified) less the amount initially received for the purchase of the Founders Shares. As of March 31, 2022 and December 31, 2021, the Company determined that a Business Combination is not considered probable, and, therefore, no stock-based compensation expense has been recognized. Promissory Note — Related Party On September 24, 2020, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Note”). The Note was non-interest bearing and was payable on the earlier of June 30, 2021 or the completion of the Initial Public Offering. The outstanding balance under the Note of $88,905 was repaid at the closing of the Initial Public Offering on January 11, 2021. Borrowings are no longer available under the Note. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s directors and officers may, but are not obligated to, make Working Capital Loans. If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. 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. The warrants would be identical to the Private Placement Warrants described in Note 8. On January 21, 2022, the Company issued a promissory note with respect to the Working Capital Loans in the principal amount of up to $1,500,000 to the Sponsor. The Working Capital Loan is non-interest bearing and payable upon the consummation of a Business Combination or may be convertible into warrants of the post-Business Combination entity at a price of $1.00 per warrant at the lender’s discretion. On January 31, 2022, $350,000 was drawn on the Working Capital Loan and is included (at its then current fair value) in convertible promissory note – related party on the accompanying condensed balance sheet as of March 31 2022. On April 1, 2022, the Company drew an additional $112,500 on the Working Capital Loan. The Convertible Note was valued using the fair value method. The discounted cash flow method was used to value the debt component of the Convertible Note and the Black Scholes Option Pricing Model was used to value the debt conversion option. The convertible promissory note is required to be recorded at its initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the notes are recognized as a non-cash gain or loss on the condensed statements of operations. The fair value of the note on date of issuance was 264,900, which resulted in a contribution to stockholder’s deficit of $85,100. The fair value of the note as of March 31, 2022 was $259,500, which resulted in a change in fair value of the convertible note of $5,400 recorded in the condensed statement of operations for the three months ended March 31, 2022. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 6 — COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on January 6, 2021, the holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of the Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) will have registration rights to require the Company to register a sale of any of the Company’s securities held by them. These holders of these securities will be entitled to make up to three demands, excluding short form registration demands, that the Company register such securities for sale under the Securities Act. In addition, these holders will have “piggy-back” registration rights to include their securities in other registration statements filed by us, subject to certain limitations. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Underwriting Agreement The underwriters are entitled to a deferred fee of $0.35 per Unit, or $6,037,500 in the aggregate. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement. Contingent Legal Fees As of March 31, 2022 and December 31, 2021, the Company has incurred legal fees of $511,413 and $118,550, respectively, payments for which are contingent upon the consummation of the Business Combination, of which such amounts are included in accrued expenses in the accompanying condensed balance sheets. |
Stockholders_ Deficit
Stockholders’ Deficit | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS’ DEFICIT | NOTE 7 — STOCKHOLDERS’ DEFICIT Preferred Stock Class A Common Stock Class B Common Stock — Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders, except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis (subject to adjustment). In the case that additional shares of Class A common stock or equity-linked securities are issued or deemed issued in connection with a Business Combination, the number of shares of Class A common stock issuable upon conversion of all Founder Shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering, plus the total number of shares of Class A common stock issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of a Business Combination, excluding any shares of Class A common stock or equity-linked securities exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in a Business Combination and any private placement-equivalent warrants issued to the Sponsor, officers or directors upon conversion of Working Capital Loans; provided that such conversion of Founder Shares will never occur on a less than one for one basis. The Company cannot determine at this time whether a majority of the holders of the Class B common stock at the time of any future issuance would agree to waive such adjustment to the conversion ratio. |
Warrant Liabilities
Warrant Liabilities | 3 Months Ended |
Mar. 31, 2022 | |
Warrant Liabilities [Abstract] | |
WARRANT LIABILITIES | NOTE 8 — WARRANT LIABILITIES As of March 31, 2022 and December 31, 2021, there were 8,625,000 Public Warrants outstanding. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants will become exercisable on the later of (a) 30 days after the consummation of a Business Combination or (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years from the consummation of a Business Combination or earlier upon redemption or liquidation. The Company will not be obligated to deliver any Class A common stock pursuant to the exercise of a Public Warrant and will have no obligation to settle such Public Warrant exercise unless a registration statement under the Securities Act covering the issuance of the Class A common stock issuable upon exercise of the Public Warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable and the Company will not be obligated to issue shares of Class A common stock upon exercise of a warrant unless Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, it will use its best efforts to file with the SEC a registration statement registering the issuance of the shares of Class A common stock issuable upon exercise of the warrants, to cause such registration statement to become effective and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60 th Once the warrants become exercisable, the Company may call the warrants for redemption (except as described with respect to the Private Placement Warrants): ● in whole and not in part; ● at a price of $0.01 per warrant; ● upon not less than 30 days’ prior written notice of redemption to each warrant holder; and ● if, and only if, the reported closing price of the Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending three business days before the Company sends to the notice of redemption to the warrant holders. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if the Company is unable to register or qualify the underlying securities for sale under all applicable state securities laws. If the Company calls the Public Warrants for redemption, as described above, its management will have the option to require any holder that wishes to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of Class A common stock issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described below, the Public Warrants will not be adjusted for issuances of Class A common stock at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the Public 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 Public Warrants will not receive any of such funds with respect to their Public Warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such Public Warrants. Accordingly, the Public Warrants may expire worthless. In addition, if (x) the Company issues additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of its 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 the Company’s board of directors and, in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the 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 the Company’s initial Business Combination on the date of the consummation of such initial Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates its initial Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. At March 31, 2022 and December 31, 2021, there were 5,200,000 Private Placement Warrants outstanding. 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 shares of common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and will be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 9 — 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. 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 the Company’s 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 on a recurring basis at March 31, 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 December 31, March 31, Assets: Cash and marketable securities held in Trust Account 1 $ 172,580,609 $ 172,620,428 Liabilities: Warrant Liabilities – Public Warrants 1 5,180,136 1,207,500 Warrant Liabilities – Private Placement Warrants 3 3,131,574 728,000 Convertible Promissory Note – Related Party 3 — 259,500 The warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on the accompanying condensed 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 condensed statements of operations. As of March 31, 2022 and December 31, 2021, the Private Placement Warrants were valued using a binomial lattice model which is considered to be a Level 3 fair value measurement. The binomial lattice model’s primary unobservable input utilized in determining the fair value of the warrants is the expected volatility of the common stock. The expected volatility as of the closing date of the Initial Public Offering was derived from observable Public Warrant pricing on comparable ‘blank-check’ companies without an identified target. The expected volatility as of subsequent valuation dates was implied from the Company’s own Public Warrant pricing. As of March 31, 2022 and December 31, 2021, the Public Warrants were valued using the level 1 quoted prices in an active market. The following table provides quantitative information regarding Level 3 fair value measurements for Private Placement Warrants at March 31, 2022 and December 31, 2021: As of As of Stock price $ 9.94 $ 9.84 Strike price $ 11.50 $ 11.50 Volatility 3.8 % 12.2 % Risk-free rate 2.42 % 1.17 % Probability of Business Combination occurring 75 % 75 % Dividend yield 0.0 % 0.0 % Fair value of warrants $ 0.14 $ 0.60 The following table presents the changes in the fair value of Level 3 warrant liabilities for the three months ended March 31, 2021: Private Placement Public Warrant Liabilities Fair value as of January 1, 2021 $ — $ — $ — Initial measurement on January 11, 2021 3,744,000 6,210,000 9,954,000 Change in valuation inputs or other assumptions (832,000 ) (1,380,000 ) (2,212,000 ) Transfer to Level 1 — (4,830,000 ) (4,830,000 ) Fair value as of March 31, 2021 $ 2,912,000 $ — $ 2,912,000 The following table presents the changes in the fair value of Level 3 warrant liabilities for the three months ended March 31, 2022: Private Fair value as of January 1, 2022 $ 3,131,574 Change in fair value (2,403,574 ) Fair value as of March 31, 2022 $ 728,000 Transfers to/from Levels 1, 2 and 3 are recognized at the end of the reporting period in which a change in valuation technique or methodology occurs. The estimated fair value of the Public Warrants transferred from a Level 3 measurement to a Level 1 fair value measurement during the three months ended March 31, 2021 was $4,830,000. There were no transfers from Level 3 to any other levels during the three months ended March 31, 2022. The Convertible Note was measured at fair value as of the date of the initial borrowing on January 31, 2022, and as of March 31, 2022. The discounted cash flow method was used to value the debt component of the Convertible Note and the Black Scholes Option Pricing Model was used to value the debt conversion option. There were no transfers in or out of Level 3 from other levels in the fair value hierarchy during three months ended March 31, 2022 for the Convertible Note. The following table provides quantitative information regarding Level 3 fair value measurements for the Convertible Promissory Note – Related Party at March 31, 2022 and January 31, 2022: As of As of Stock price $ 9.94 $ 9.87 Strike price $ 11.50 $ 11.50 Volatility 3.8 % 9.1 % Risk-free rate 2.40 % 2.40 % Probability of Business Combination occurring 75 % 75 % Dividend yield 0.0 % 0.0 % The following contains additional information regarding the inputs used in the pricing models: ● Term – the expected life of the warrants was assumed to be equivalent to their remaining contractual term. ● Risk-free rate – the risk-free interest rate is based on the U.S. treasury yield curve in effect on the date of valuation equal to the remaining expected life of the Warrants. ● Volatility – the Company estimated the volatility of its common stock warrants based on implied volatility and actual historical volatility of a group of comparable publicly traded companies observed over a historical period equal to the expected remaining life of the Warrants. ● Dividend yield – the dividend yield percentage is zero because the Company does not currently pay dividends, nor does it intend to do so during the expected term of the Private Placement Warrants. The following table presents the changes in the fair value of Level 3 Convertible Promissory Note – Related Party for the three months ended March 31, 2022: Convertible Fair value as of January 1, 2022 $ — Initial measurement at January 31, 2022 264,900 Change in fair value (5,400 ) Fair value as of March 31, 2022 $ 259,500 Transfers to/from Levels 1, 2 and 3 are recognized at the end of the reporting period. There were no transfers during the three months ended March 31, 2022. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 10 — SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed financial statements were issued. Based upon this review, except as identified below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements. On April 1, 2022, the Company drew an additional $112,500 on the Working Capital Loan (see Note 5). |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed 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 management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on April 12, 2022. The accompanying condensed balance sheet as of December 31, 2021 has been derived from the audited financial statements included in that annual report. The interim results for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future periods. |
Emerging Growth Company | Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. |
Use of Estimates | Use of Estimates The preparation of condensed 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 condensed financial statements and the reported amounts of income and expenses during the reporting periods. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the condensed financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2022 and December 31, 2021. |
Marketable Securities Held in Trust Account | Marketable Securities Held in Trust Account At March 31, 2022 and December 31, 2021, substantially all of the assets held in the Trust Account were primarily invested in U.S. Treasury securities. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the condensed balance sheets at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in the Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying condensed statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. |
Class A Common Stock Subject to Possible Redemption | Class A Common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in ASC Topic 480, “Distinguishing Liabilities from Equity.” Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including Class A common stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s condensed balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the re-measurement from initial carrying value to redemption amount, which approximates fair 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 during the three months ended March 31, 2021. There were no changes in the carrying value of redeemable Class A common stock during the three months ended March 31, 2022. At March 31, 2022 and December 31, 2021, the shares of Class A common stock reflected in the condensed balance sheet as temporary equity were reconciled in the following table: Gross proceeds for the Initial Public Offering $ 172,500,000 Less: Proceeds allocated to the initial fair value of Public Warrants (6,210,000 ) Class A common stock issuance costs (9,527,789 ) Fair value of Founder Shares attributable to Anchor Investor allocated to redeemable Class A common stock, net of allocated transaction costs (4,252,433 ) Plus: Re-measurement of carrying value to redemption value 19,990,222 Class A common stock subject to possible redemption $ 172,500,000 |
Warrant Liabilities | Warrant Liabilities The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480, and ASC 815, “Derivatives and Hedging” (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own shares of common stock, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the condensed statements of operations. For the Private Placement Warrants, the fair value was estimated using a binomial lattice model incorporating the Cox-Ross-Rubenstein methodology since the closing date of Initial Public Offering and as of March 31, 2022 (see Note 9). For the public warrants, the fair value was estimated using a binomial lattice model incorporating the Cox-Ross-Rubenstein methodology at the closing date of Initial Public Offering and the level 1 quoted prices in an active market since the public warrants starting trading separately on March 1, 2021 and |
Convertible Instruments | Convertible Instruments The Company evaluated the accounting for its promissory notes that feature conversion options in accordance with ASC 815, Derivatives and Hedging Activities (“ASC 815”). ASC 815 requires companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments according to certain criteria. The criteria includes circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) a promissory note that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. However, the Company has elected to account for its promissory notes at fair value, as described in Note 9. |
Allocation of issuance costs | Allocation of issuance costs The Company accounts for the allocation of its issuance costs to its warrants using the guidance in ASC Topic 470-20, “Debt with Conversion and Other Options” (“ASC 470-20), applied by analogy. Under this guidance, if debt or stock is issued with detachable warrants, the proceeds need to be allocated to the two instruments using either the fair value method, the relative fair value method, or the residual value method. The guidance also requires companies to use a consistent approach in allocating issuance costs between the instruments. Accordingly, the Company allocated its issuance costs of $14,303,235—consisting of $3,450,000 of underwriting fees, $6,037,500 of deferred underwriting commissions, $4,411,238 of fair value of the Founder Shares attributable to the Anchor Investor, and $404,497 of other offering costs—to the issuance of its Class A common stock and warrants in the amount of $13,780,222 and $523,013, respectively. Issuance costs attributed to the warrants were expensed to the condensed statement of operations during the three months ended March 31, 2021. Issuance costs attributed to the Class A common stock were initially charged to temporary equity and then re-measured to Class A common stock subject to redemption upon completion of the Initial Public Offering. |
Income Taxes | Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the condensed financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. As of March 31, 2022 and December 31, 2021, the Company has provided a full valuation allowance against its net deferred tax assets. ASC 740 prescribes a recognition threshold and a measurement attribute for the condensed 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 recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2022 and December 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. For interim periods, the income tax provision or benefit related to ordinary income or loss is computed at an estimated annual effective income tax rate and the income tax provision or benefit related to all other items is individually computed and recognized when the items occur. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2022 and 2021, due primarily to the permanent differences. The permanent differences relate primarily to the change in fair value of warrant liabilities and convertible notes. |
Net Income per Share of Common Stock | Net Income per Share of Common Stock The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. Net income per share of common stock is computed by dividing net income by the weighted average number of shares of common stock outstanding for the period. The Company applies the two-class method in calculating income per share of common stock. Re-measurement associated with the redeemable shares of Class A common stock is excluded from income per share of common stock as the redemption value approximates fair value. Net income is allocated among the classes of common stock based on weighted average shares outstanding. The calculation of diluted income 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 13,825,000 shares of Class A common stock in the aggregate, not including warrants that may be acquired from the conversion feature in the Convertible Promissory Note. As of March 31, 2022 and 2021, the Company did not have any other 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 per share of common stock is the same as basic net income per share of common stock for the periods presented. Founder Shares subject to forfeiture (see Note 5) are not included in weighted average shares outstanding for basic net income per share until the forfeiture restrictions lapse, however, they are included in weighted average shares outstanding for diluted net income per share for the entire period. The following table reflects the calculation of basic and diluted net income per share of common stock (in dollars, except share amounts): For the Three Months Ended For the Three Months Ended Class A Class B Class A Class B Basic net income per share of common stock Numerator: Allocation of net income $ 4,624,471 $ 1,156,118 $ 1,084,225 $ 303,875 Denominator: Basic weighted average shares outstanding 17,250,000 4,312,500 15,141,667 4,243,750 Basic net income per share of common stock $ 0.27 $ 0.27 $ 0.07 $ 0.07 Diluted net income per share of common stock Numerator: Allocation of net income $ 4,624,471 $ 1,156,118 $ 1,084,225 $ 303,875 Denominator: Diluted weighted average shares outstanding 17,250,000 4,312,500 15,141,667 4,312,500 Diluted net income per share of common stock $ 0.27 $ 0.27 $ 0.07 $ 0.07 |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations 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. The Company has not experienced losses on these accounts. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the Company’s condensed balance sheets, primarily due to their short-term nature, except for warrants (see Note 9). |
Recent Accounting Standards | Recent Accounting Standards 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 condensed financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of the shares of Class A common stock reflected in the condensed balance sheets as temporary equity | Gross proceeds for the Initial Public Offering $ 172,500,000 Less: Proceeds allocated to the initial fair value of Public Warrants (6,210,000 ) Class A common stock issuance costs (9,527,789 ) Fair value of Founder Shares attributable to Anchor Investor allocated to redeemable Class A common stock, net of allocated transaction costs (4,252,433 ) Plus: Re-measurement of carrying value to redemption value 19,990,222 Class A common stock subject to possible redemption $ 172,500,000 |
Schedule of basic and diluted net income per common share | For the Three Months Ended For the Three Months Ended Class A Class B Class A Class B Basic net income per share of common stock Numerator: Allocation of net income $ 4,624,471 $ 1,156,118 $ 1,084,225 $ 303,875 Denominator: Basic weighted average shares outstanding 17,250,000 4,312,500 15,141,667 4,243,750 Basic net income per share of common stock $ 0.27 $ 0.27 $ 0.07 $ 0.07 Diluted net income per share of common stock Numerator: Allocation of net income $ 4,624,471 $ 1,156,118 $ 1,084,225 $ 303,875 Denominator: Diluted weighted average shares outstanding 17,250,000 4,312,500 15,141,667 4,312,500 Diluted net income per share of common stock $ 0.27 $ 0.27 $ 0.07 $ 0.07 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets that are measured at fair value on a recurring basis | Description Level December 31, March 31, Assets: Cash and marketable securities held in Trust Account 1 $ 172,580,609 $ 172,620,428 Liabilities: Warrant Liabilities – Public Warrants 1 5,180,136 1,207,500 Warrant Liabilities – Private Placement Warrants 3 3,131,574 728,000 Convertible Promissory Note – Related Party 3 — 259,500 |
Schedule of provides quantitative information regarding Level 3 fair value measurements | As of As of Stock price $ 9.94 $ 9.84 Strike price $ 11.50 $ 11.50 Volatility 3.8 % 12.2 % Risk-free rate 2.42 % 1.17 % Probability of Business Combination occurring 75 % 75 % Dividend yield 0.0 % 0.0 % Fair value of warrants $ 0.14 $ 0.60 As of As of Stock price $ 9.94 $ 9.87 Strike price $ 11.50 $ 11.50 Volatility 3.8 % 9.1 % Risk-free rate 2.40 % 2.40 % Probability of Business Combination occurring 75 % 75 % Dividend yield 0.0 % 0.0 % |
Schedule of change in the fair value of warrant liabilities | Private Placement Public Warrant Liabilities Fair value as of January 1, 2021 $ — $ — $ — Initial measurement on January 11, 2021 3,744,000 6,210,000 9,954,000 Change in valuation inputs or other assumptions (832,000 ) (1,380,000 ) (2,212,000 ) Transfer to Level 1 — (4,830,000 ) (4,830,000 ) Fair value as of March 31, 2021 $ 2,912,000 $ — $ 2,912,000 Private Fair value as of January 1, 2022 $ 3,131,574 Change in fair value (2,403,574 ) Fair value as of March 31, 2022 $ 728,000 Convertible Fair value as of January 1, 2022 $ — Initial measurement at January 31, 2022 264,900 Change in fair value (5,400 ) Fair value as of March 31, 2022 $ 259,500 |
Description of Organization a_2
Description of Organization and Business Operations (Details) - USD ($) | Jan. 11, 2021 | Jan. 21, 2022 | Mar. 31, 2022 | Apr. 01, 2022 | Jan. 31, 2022 |
Description of Organization and Business Operations (Details) [Line Items] | |||||
Gross proceeds | $ 172,500,000 | ||||
Transaction costs amount | $ 14,303,235 | ||||
Underwriting fees | 3,450,000 | ||||
Deferred underwriting fees | 6,037,500 | ||||
Fair value amount | 4,411,238 | ||||
Other offering costs | $ 404,497 | ||||
Net proceeds | $ 172,500,000 | ||||
Share unit price (in Dollars per share) | $ 10 | ||||
Fair market value, percentage | 80.00% | ||||
Public share (in Dollars per share) | $ 10 | ||||
Public share percentage | 15.00% | ||||
Public shares redeem percentage | 100.00% | ||||
Dissolution expenses | $ 100,000 | ||||
Offering price per share (in Dollars per share) | $ (10) | ||||
Operating bank accounts | $ 43,339 | ||||
Working capital | 478,142 | ||||
Taxes payable | 50,000 | ||||
Principal amount | $ 1,500,000 | ||||
Working capital loan | 1,500,000 | $ 112,500 | $ 350,000 | ||
Convertible warrants per share (in Dollars per share) | $ 1 | ||||
Warrant [Member] | |||||
Description of Organization and Business Operations (Details) [Line Items] | |||||
Transaction costs amount | 523,013 | ||||
Securities [Member] | |||||
Description of Organization and Business Operations (Details) [Line Items] | |||||
Amount held in trust account | $ 172,620,428 | ||||
IPO [Member] | |||||
Description of Organization and Business Operations (Details) [Line Items] | |||||
Issuance of units (in Shares) | 17,250,000 | ||||
Per share unit (in Dollars per share) | $ 10 | ||||
Over-Allotment Option [Member] | |||||
Description of Organization and Business Operations (Details) [Line Items] | |||||
Issuance of units (in Shares) | 2,250,000 | ||||
Per share unit (in Dollars per share) | $ 10 | ||||
Private Placement Warrant [Member] | |||||
Description of Organization and Business Operations (Details) [Line Items] | |||||
Issuance of units (in Shares) | 5,200,000 | ||||
Per share unit (in Dollars per share) | $ 1 | ||||
Gross proceeds | $ 5,200,000 | ||||
Deposits [Member] | |||||
Description of Organization and Business Operations (Details) [Line Items] | |||||
Amount held in trust account | 120,000 | ||||
Tax expenses | $ 100,000 | ||||
Business Combination [Member] | |||||
Description of Organization and Business Operations (Details) [Line Items] | |||||
Outstanding voting securities percentage | 50.00% | ||||
Net tangible assets | $ 5,000,001 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) | 3 Months Ended |
Mar. 31, 2022USD ($)shares | |
Summary of Significant Accounting Policies (Details) [Line Items] | |
Allocated issuance costs | $ 14,303,235 |
Underwriting fees | 3,450,000 |
Deferred underwriting commissions | 6,037,500 |
Fair value amount | 4,411,238 |
Other offering cost | 404,497 |
Issuance of Class A shares amount | 13,780,222 |
Warrants amount issuance costs | $ 523,013 |
Statutory tax rate percentage | 21.00% |
Federal depository insurance coverage expense | $ 250,000 |
Class A Common Stock [Member] | |
Summary of Significant Accounting Policies (Details) [Line Items] | |
Share subject to forfeiture (in Shares) | shares | 13,825,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - Schedule of the shares of Class A common stock reflected in the condensed balance sheets as temporary equity | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Schedule of the shares of Class A common stock reflected in the condensed balance sheets as temporary equity [Abstract] | |
Gross proceeds for the Initial Public Offering | $ 172,500,000 |
Less: | |
Proceeds allocated to the initial fair value of Public Warrants | (6,210,000) |
Class A common stock issuance costs | (9,527,789) |
Fair value of Founder Shares attributable to Anchor Investor allocated to redeemable Class A common stock, net of allocated transaction costs | (4,252,433) |
Plus: | |
Re-measurement of carrying value to redemption value | 19,990,222 |
Class A common stock subject to possible redemption | $ 172,500,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details) - Schedule of basic and diluted net income per common share - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Class A [Member] | ||
Numerator: | ||
Allocation of net income | $ 4,624,471 | $ 1,084,225 |
Denominator: | ||
Basic weighted average shares outstanding | 17,250,000 | 15,141,667 |
Basic net income per share of common stock | $ 0.27 | $ 0.07 |
Numerator: | ||
Allocation of net income | $ 4,624,471 | $ 1,084,225 |
Denominator: | ||
Diluted weighted average shares outstanding | 17,250,000 | 15,141,667 |
Diluted net income per share of common stock | $ 0.27 | $ 0.07 |
Class B [Member] | ||
Numerator: | ||
Allocation of net income | $ 1,156,118 | $ 303,875 |
Denominator: | ||
Basic weighted average shares outstanding | 4,312,500 | 4,243,750 |
Basic net income per share of common stock | $ 0.27 | $ 0.07 |
Numerator: | ||
Allocation of net income | $ 1,156,118 | $ 303,875 |
Denominator: | ||
Diluted weighted average shares outstanding | 4,312,500 | 4,312,500 |
Diluted net income per share of common stock | $ 0.27 | $ 0.07 |
Initial Public Offering (Detail
Initial Public Offering (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Initial Public Offering (Details) [Line Items] | |
Common stock, description | Each Unit consists of one share of the Company’s Class A common stock and one-half of one redeemable warrant (“Public Warrant”). Each Whole Public Warrant entitles the holder to purchase one share of Class A common stock at an exercise price of $11.50 per whole share (see Note 8). |
Initial Public Offering [member] | |
Initial Public Offering (Details) [Line Items] | |
Sale of units | 17,250,000 |
Over-Allotment Option [Member] | |
Initial Public Offering (Details) [Line Items] | |
Sale of units | 2,250,000 |
Purchase price per unit (in Dollars per share) | $ / shares | $ 10 |
Private Placement Warrants (Det
Private Placement Warrants (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | |
Private Placement Warrants (Details) [Line Items] | |||
Fair value per share | $ 0.72 | ||
Purchase price per share | $ 1 | ||
Additional paid-in capital | $ 1,456,000 | ||
Private Placement Warrants [Member] | |||
Private Placement Warrants (Details) [Line Items] | |||
Sale of stock | 5,200,000 | 5,200,000 | |
Price per share | $ 1 | ||
Aggregate purchase price | $ 5,200,000 | ||
Aggregate cost | 780,000 | ||
Share purchased | $ 780,000 | ||
Class A Common Stock [Member] | |||
Private Placement Warrants (Details) [Line Items] | |||
Warrant exercise price per share | $ 11.5 | ||
Anchor Investor [Member] | |||
Private Placement Warrants (Details) [Line Items] | |||
Price per share | $ 1 | ||
Purchased an aggregate of private placement warrants | 780,000 | ||
Share purchased | $ 4,420,000 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Jan. 06, 2021 | Jan. 21, 2022 | Sep. 24, 2020 | Mar. 31, 2022 | Mar. 31, 2021 | Apr. 01, 2022 | Jan. 31, 2022 | Jan. 11, 2021 |
Related Party Transactions (Details) [Line Items] | ||||||||
Sponsor transferred an aggregate (in Shares) | 75,000 | |||||||
Share subject to forfeiture (in Shares) | 562,500 | |||||||
Aggregate founder shares (in Shares) | 635,625 | |||||||
Fair value amount | $ 4,411,238 | |||||||
Fair value per shares (in Dollars per share) | $ 6.94 | |||||||
Offering costs amount | $ 4,411,238 | |||||||
Transaction cost | 158,805 | |||||||
Warrant liabilities amount | 4,252,433 | |||||||
Working capital loan | 1,500,000 | $ 112,500 | $ 350,000 | |||||
Consulting services | $ 1 | |||||||
Fair value of issuance | $ 264,900 | |||||||
Fair value of convertible note on issuance date | 85,100 | |||||||
Fair value note | 259,500 | |||||||
Fair value of the convertible note | $ 5,400 | |||||||
Over-Allotment Option [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Share subject to forfeiture (in Shares) | 75,000 | |||||||
Initial Public Offering [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Expenses related to initial public offering | $ 300,000 | |||||||
Borrowings outstanding | $ 88,905 | |||||||
Class B Common Stock [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Founder share (in Shares) | 4,312,500 | |||||||
Founder Shares [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Sponsor paid | $ 25,000 | |||||||
Issued and outstanding shares percentage | 20.00% | |||||||
Sponsors [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Founder shares, description | The Sponsor and its director nominees have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) subsequent to a Business Combination, (x) if the last sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Deferred fee, price per unit (in Dollars per share) | $ 0.35 | |
Deferred fee | $ 6,037,500 | |
Legal fees | $ 511,413 | $ 118,550 |
Stockholders_ Deficit (Details)
Stockholders’ Deficit (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Stockholders’ Deficit (Details) [Line Items] | ||
Preferred stock shares authorized | 1,000,000 | 1,000,000 |
Preferred stock par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock shares issued | ||
Preferred stock shares outstanding | ||
Shares outstanding percentage | 20.00% | |
Preferred Stock [Member] | ||
Stockholders’ Deficit (Details) [Line Items] | ||
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Class A common stock [Member] | ||
Stockholders’ Deficit (Details) [Line Items] | ||
Common stock shares authorized | 280,000,000 | 280,000,000 |
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock shares issued | 17,250,000 | 17,250,000 |
Common stock shares outstanding | 17,250,000 | 17,250,000 |
Class B Common Stock [Member] | ||
Stockholders’ Deficit (Details) [Line Items] | ||
Common stock shares authorized | 20,000,000 | 20,000,000 |
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock shares issued | 4,312,500 | 4,312,500 |
Common stock shares outstanding | 4,312,500 | 4,312,500 |
Warrant Liabilities (Details)
Warrant Liabilities (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Warrant Liabilities (Details) [Line Items] | ||
Warrant expire period | 5 years | |
Warrant redemption description | Once the warrants become exercisable, the Company may call the warrants for redemption (except as described with respect to the Private Placement Warrants): ●in whole and not in part; ●at a price of $0.01 per warrant; ●upon not less than 30 days’ prior written notice of redemption to each warrant holder; and ●if, and only if, the reported closing price of the Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending three business days before the Company sends to the notice of redemption to the warrant holders. | |
Equity proceeds | 60.00% | |
Exercise price (in Dollars per share) | $ 9.2 | |
Newly issued price percentage | 115.00% | |
Redemption trigger price (in Dollars per share) | $ 18 | |
Market value, percentage | 180.00% | |
Warrant [Member] | ||
Warrant Liabilities (Details) [Line Items] | ||
Warrants outstanding | 8,625,000 | 8,625,000 |
Private Placement Warrants [Member] | ||
Warrant Liabilities (Details) [Line Items] | ||
Warrants outstanding | 5,200,000 | 5,200,000 |
Business Combination [Member] | ||
Warrant Liabilities (Details) [Line Items] | ||
Business combination price (in Dollars per share) | $ 9.2 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Fair Value Disclosures [Abstract] | |
Fair value of the public warrants | $ 4,830,000 |
Fair Value Measurements (Deta_2
Fair Value Measurements (Details) - Schedule of assets that are measured at fair value on a recurring basis - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Level 1 [Member] | ||
Assets: | ||
Cash and marketable securities held in Trust Account | $ 172,620,428 | $ 172,580,609 |
Liabilities: | ||
Warrant Liabilities – Public Warrants | 1,207,500 | 5,180,136 |
Level 3 [Member] | ||
Liabilities: | ||
Warrant Liabilities – Private Placement Warrants | 728,000 | 3,131,574 |
Convertible Promissory Note – Related Party | $ 259,500 |
Fair Value Measurements (Deta_3
Fair Value Measurements (Details) - Schedule of provides quantitative information regarding Level 3 fair value measurements - Fair Value, Inputs, Level 3 [Member] | 1 Months Ended | 3 Months Ended | 12 Months Ended |
Jan. 31, 2021$ / shares$ / item | Mar. 31, 2022USD ($)$ / shares$ / item | Dec. 31, 2021USD ($)$ / shares$ / item | |
private placement warrants [Member] | |||
Fair Value Measurements (Details) - Schedule of provides quantitative information regarding Level 3 fair value measurements [Line Items] | |||
Stock price (in Dollars per share) | $ / shares | $ 9.94 | $ 9.84 | |
Strike price (in Dollars per Item) | $ / item | 11.5 | 11.5 | |
Volatility | 3.80% | 12.20% | |
Risk-free rate | 2.42% | 1.17% | |
Dividend yield | 0.00% | 0.00% | |
Fair value of warrants (in Dollars) | $ | $ 0.14 | $ 0.6 | |
Convertible Promissory Note – Related Party [Member] | |||
Fair Value Measurements (Details) - Schedule of provides quantitative information regarding Level 3 fair value measurements [Line Items] | |||
Stock price (in Dollars per share) | $ / shares | $ 9.87 | $ 9.94 | |
Strike price (in Dollars per Item) | $ / item | 11.5 | 11.5 | |
Volatility | 9.10% | 3.80% | |
Risk-free rate | 2.40% | 2.40% | |
Dividend yield | 0.00% | 0.00% | |
Business combination [Member] | private placement warrants [Member] | |||
Fair Value Measurements (Details) - Schedule of provides quantitative information regarding Level 3 fair value measurements [Line Items] | |||
Probability of Business Combination occurring | 75.00% | 75.00% | |
Business combination [Member] | Convertible Promissory Note – Related Party [Member] | |||
Fair Value Measurements (Details) - Schedule of provides quantitative information regarding Level 3 fair value measurements [Line Items] | |||
Probability of Business Combination occurring | 75.00% | 75.00% |
Fair Value Measurements (Deta_4
Fair Value Measurements (Details) - Schedule of change in the fair value of warrant liabilities - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Private Placement [Member] | ||
Fair Value Measurements (Details) - Schedule of change in the fair value of warrant liabilities [Line Items] | ||
Fair value at beginning | $ 3,131,574 | |
Change in fair value | (2,403,574) | |
Initial measurement on January 11, 2021 | 3,744,000 | |
Change in valuation inputs or other assumptions | (832,000) | |
Transfer to Level 1 | ||
Fair value at ending | 728,000 | 2,912,000 |
Public [Member] | ||
Fair Value Measurements (Details) - Schedule of change in the fair value of warrant liabilities [Line Items] | ||
Fair value at beginning | ||
Initial measurement on January 11, 2021 | 6,210,000 | |
Change in valuation inputs or other assumptions | (1,380,000) | |
Transfer to Level 1 | (4,830,000) | |
Fair value at ending | ||
Warrant Liabilities [Member] | ||
Fair Value Measurements (Details) - Schedule of change in the fair value of warrant liabilities [Line Items] | ||
Fair value at beginning | ||
Initial measurement on January 11, 2021 | 9,954,000 | |
Change in valuation inputs or other assumptions | (2,212,000) | |
Transfer to Level 1 | (4,830,000) | |
Fair value at ending | $ 2,912,000 | |
Convertible Promissory Note [Member] | ||
Fair Value Measurements (Details) - Schedule of change in the fair value of warrant liabilities [Line Items] | ||
Fair value at beginning | ||
Amount borrowed at January 31, 2022 | 264,900 | |
Change in fair value | (5,400) | |
Fair value at ending | $ 259,500 |
Subsequent Events (Details)
Subsequent Events (Details) | Apr. 01, 2022USD ($) |
Subsequent Event [Member] | |
Subsequent Events (Details) [Line Items] | |
Working capital loan | $ 112,500 |