Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2022 | Apr. 28, 2022 | |
Cover [Abstract] | ||
Entity Registrant Name | AMERICAN ACQUISITION OPPORTUNITY INC. | |
Entity Central Index Key | 0001843656 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | true | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | No | |
Document Period End Date | Mar. 31, 2022 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Entity Ex Transition Period | true | |
Entity Common Stock Shares Outstanding | 4,537,685 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-40233 | |
Entity Incorporation State Country Code | DE | |
Entity Tax Identification Number | 86-1599759 | |
Entity Interactive Data Current | Yes | |
Entity Address Address Line 1 | 12115 Visionary Way | |
Entity Address City Or Town | Fishers | |
Entity Address State Or Province | IN | |
Entity Address Postal Zip Code | 46038 | |
City Area Code | 317 | |
Local Phone Number | 855-9926 | |
Security Exchange Name | NASDAQ | |
Security 12b Title | Common stock par value $0.0001 per share | |
Trading Symbol | AMAO |
CONDENSED BALANCE SHEET
CONDENSED BALANCE SHEET - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Current Assets | ||
Cash | $ 1,511 | $ 293,153 |
Account Receivable - Related Party | 268,125 | 675,000 |
Prepaid Insurance | 206,762 | 102,534 |
Deposits | 75,000 | 0 |
Total Current Assets | 551,398 | 1,070,687 |
Cash Held In Trust Account | 15,788,742 | 106,116,023 |
Cash Held In Escrow Account | 280,875 | 0 |
Total Assets | 16,621,015 | 107,186,710 |
Current Liabilities | ||
Accounts Payable | 99,002 | 99,002 |
Total Current Liabilities | 99,002 | 99,002 |
Deferred Underwriter Commissions | 3,500,000 | 3,500,000 |
Fair Value Liability Of Public Warrants | 785,250 | 3,036,301 |
Fair Value Liability Of Private Warrants | 585,244 | 2,262,941 |
Total Liabilities | 4,969,496 | 8,898,244 |
Shareholder's Equity | ||
Additional Paid-in Capital | (10,140,613) | (10,140,613) |
Accumulated Deficit | 6,014,352 | 2,316,786 |
Total Shareholder's Equity | (4,131,600) | (7,823,554) |
Total Liabilities And Shareholder's Equity | 16,621,015 | 107,186,710 |
Class B Common Stock [Member] | ||
Shareholder's Equity | ||
Common Stock Value | 273 | 273 |
Class A Common Stock [Member] | ||
Shareholder's Equity | ||
Common Stock Value | $ 15,788,742 | $ 106,112,020 |
CONDENSED BALANCE SHEET (Parent
CONDENSED BALANCE SHEET (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Class B Common Stock, Par Value | $ 10.10 | |
Class B Common Stock [Member] | ||
Class B Common Stock, Par Value | $ 0.0001 | $ 0.0001 |
Class B Common Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Class B Common Stock, Shares Issued | 2,726,500 | 2,726,500 |
Class B Common Stock, Shares Outstanding | 2,726,500 | 2,726,500 |
Class B Common Stock, Representative Shares | 100,000 | 100,000 |
Class A Common Stock [Member] | ||
Class B Common Stock, Par Value | $ 10.10 | $ 10.10 |
Class A Common Stock, Shares At Redemption Value | 1,563,242 | 1,563,242 |
CONDENSED STATEMENT OF OPERATIO
CONDENSED STATEMENT OF OPERATIONS (Unaudited) - USD ($) | 2 Months Ended | 3 Months Ended |
Mar. 31, 2021 | Mar. 31, 2022 | |
CONDENSED STATEMENT OF OPERATIONS (Unaudited) | ||
Professional Fees | $ (15,450) | $ (102,400) |
General And Administrative | 0 | (136,014) |
Total Expenses | (15,450) | (238,414) |
Gain On Warrant Fair Value Adjustment | 1,534,000 | 3,928,748 |
Other Income | 0 | 1,620 |
Net Income | $ 1,518,550 | $ 3,691,954 |
Weighted Average Shares Outstanding, Basic And Diluted | 3,887,500 | 12,387,930 |
Basic And Diluted Net Loss Per Ordinary Share | $ 0.39 | $ 0.30 |
CONDENSED STATEMENT OF CHANGES
CONDENSED STATEMENT OF CHANGES SHAREHOLDERS EQUITY (Unaudited) - USD ($) | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Balance, Amount at Jan. 20, 2021 | $ 0 | $ 0 | $ 0 | $ 0 |
Issuance Of Class B Common Stock To Founders(1), Shares | 2,626,500 | |||
Issuance Of Class B Common Stock To Founders(1), Amount | 25,000 | $ 263 | 24,737 | 0 |
Issuance Of Class B Common To Representatives, Shares | 100,000 | |||
Issuance Of Class B Common To Representatives, Amount | 1,000 | $ 10 | 990 | 0 |
Offering Costs | (4,910,297) | 0 | (4,910,297) | 0 |
Warrant Fair Value And Capital Adjustments | 496,956 | 0 | 496,956 | 0 |
Class A Common Stock | (5,752,999) | 0 | (5,752,999) | 0 |
Net Income | 2,316,786 | $ 0 | 0 | 2,316,786 |
Balance, Shares at Dec. 31, 2021 | 2,726,500 | |||
Balance, Amount at Dec. 31, 2021 | (7,823,554) | $ 273 | (10,140,613) | 2,316,786 |
Net Income | 3,691,954 | $ 0 | 0 | 3,691,954 |
Balance, Shares at Mar. 31, 2022 | 2,726,500 | |||
Balance, Amount at Mar. 31, 2022 | $ (4,131,600) | $ 273 | $ (10,140,613) | $ 6,008,740 |
CONDENSED STATEMENT OF CASH FLO
CONDENSED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) | 2 Months Ended | 3 Months Ended |
Mar. 31, 2021 | Mar. 31, 2022 | |
Cash Flows From Operating Activities: | ||
Net Income | $ 1,518,550 | $ 3,691,954 |
Adjustments To Reconcile Net Income To Net Cash Used In Operations | ||
Fair Value Adjustment Of Public Warrants | (850,000) | (2,251,051) |
Fair Value Adjustment Of Private Warrants | (684,000) | (1,677,697) |
Changes In Operating Assets And Liabilities: | ||
Account Receivable - Related Party | 0 | 408,875 |
Prepaid Insurance | (410,154) | (104,228) |
Deposits | 0 | (75,000) |
Accounts Payable | 0 | 0 |
Net Used In Operating Activities | (425,604) | (9,147) |
Cash Flows From Investing Activities | ||
Investment Of Cash In Trust Account | (101,000,000) | 90,046,406 |
Cash Flows From Financing Activities: | ||
Proceeds From Initial Stockholders | 25,000 | 0 |
Proceeds From Sale Of Units, Net Underwriting Discounts Paid | 98,539,704 | (90,328,901) |
Proceeds From Sale Of Private Warrants | 3,850,000 | 0 |
Proceeds From Promissory Note - Related Party | 485,900 | 0 |
Repayment Of Promissory Note - Related Party | (485,900) | 0 |
Proceeds From Advance - Related Party | 760,000 | 0 |
Repayment Of Advance - Related Party | (760,000) | 0 |
Net Cash Provided By Financing Activities | 102,414,704 | (90,328,901) |
Net Change In Cash | 989,100 | (291,642) |
Cash - Beginning Of Period | 0 | 293,153 |
Cash - Ending Of Period | $ 989,100 | $ 1,511 |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 3 Months Ended |
Mar. 31, 2022 | |
NATURE OF OPERATIONS | |
Nature Of Operations | NOTE 1: NATURE OF OPERATIONS The Company is a blank check company organized on January 20, 2021 under the laws of the State of Delaware. The Company was formed for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, entering into contractual arrangements with, or engaging in any other similar business combination with one or more businesses or entities (“Business Combination”). Although the Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination, the Company intends to focus on companies in the land holdings and resources industry in the United States. The registration statement for the Company’s initial public offering was declared effective on March 17, 2021 (“Initial Public Offering”). On March 22, 2021, the Company consummated the Initial Public Offering of 10,000,000 units (the “Units” and, with respect to the shares of Class A common stock included in the Units sold, the “Public Shares”), at $10.00 per Unit, generating gross proceeds of $100,000,000, which is described in Note 4. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 3,800,000 warrants (the “Private Warrants”) at a price of $1.00 per Private Warrant in a private placement to the Company’s sponsor, American Opportunity Ventures, LLC (the “Sponsor”), generating gross proceeds of $3,800,000, which is described in Note 5. Transaction costs amounted to $4,910,297, consisting of $1,000,000 of underwriting fees, $3,500,000 of deferred underwriting fees and $410,297 of other offering costs. Following the closing of the Initial Public Offering on March 22, 2021, an amount of $101,000,000 ($10.10 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Warrants was placed in a trust account (the “Trust Account”), located in the United States and held as cash items or invested only 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 selected by the Company meeting the conditions of paragraph (d) of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the assets held in the Trust Account, as described below. The Company has listed the Units on the Nasdaq Capital Market (“Nasdaq”). The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and sale of the Private Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. Nasdaq rules provide that the Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (as defined below) (less any deferred underwriting commissions and taxes payable on interest earned and less any interest earned thereon that is released for taxes) at the time of the signing of an agreement to enter into a Business Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”). There is no assurance that the Company will be able to successfully effect a Business Combination. After the Initial Public Offering, the Company is holding $101,000,000 from the proceeds received from the Initial Public Offering and the sale of the Private Warrants in the Trust Account, and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 180 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 will provide its stockholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. In connection with a Business Combination, the Company may seek stockholder approval of a Business Combination at a meeting called for such purpose at which stockholders may seek to redeem their shares, regardless of whether they vote for or against a Business Combination. The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the outstanding shares voted are voted in favor of the Business Combination. If the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Company’s Amended and Restated Certificate of Incorporation and By-Laws provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from seeking redemption rights with respect to 15% or more of the Public Shares without the Company’s prior written consent. The stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially $10.10 per 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). The per-share amount to be distributed to stockholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriter. There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s Warrants. These common stocks will be recorded at a redemption value and classified as temporary equity upon the completion of the Initial Public Offering, in accordance with Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” If a stockholder vote is not required and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation, offer such redemption pursuant to the tender offer rules of the SEC, and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC, prior to completing a Business Combination. The Sponsor has agreed (a) to vote its Class B common stock and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination, (b) not to propose an amendment to the Company’s Amended and Restated Certificate of Incorporation with respect to the Company’s pre-Business Combination activities prior to the consummation of a Business Combination unless the Company provides dissenting public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment; (c) not to redeem any shares (including the Class B common stock) into the right to receive cash from the Trust Account in connection with a stockholder vote to approve a Business Combination (or to sell any shares in a tender offer in connection with a Business Combination if the Company does not seek stockholder approval in connection therewith) or a vote to amend the provisions of the Amended and Restated Memorandum and Articles of Association relating to stockholders’ rights of pre-Business Combination activity and (d) that the Class B common stock and securities underlying the Private Warrants shall not participate in any liquidating distributions upon winding up if a Business Combination is not consummated. However, the Sponsor will be entitled to liquidating distributions from the Trust Account with respect to any Public Shares purchased during or after the Initial Public Offering if the Company fails to complete its Business Combination. The Company will have until March 22, 2022 to consummate 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 no more than five business days thereafter, redeem 100% of the outstanding 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 (net of taxes payable and less interest to pay dissolution expenses up to $100,000), 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 liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining stockholders and the Company’s board of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject in each case to its obligations to provide for claims of creditors and the requirements of applicable law. The underwriter has agreed to waive its rights to the deferred underwriting commission 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 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 ($10.10). On March 21, 2022 the Company certified an Amended and Restated Certificate of Incorporation of the Company extending the Combination Period to September 21, 2022. The Sponsor has agreed that it will be liable to the Company, if and to the extent any claims by a vendor 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 amounts in the Trust Account to below $10.10 per share (whether or not the underwriters’ over-allotment option is exercised in full), except as 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”). 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 for the company’s independent registered 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. Risks and Uncertainties: |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Summary Of Significant Accounting Policies | NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC. The Company adopted the calendar year as its basis of reporting. Interim Financial Information Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. In the opinion of management, these interim unaudited Consolidated Financial Statements reflect all normal and recurring adjustments necessary for a fair presentation of the results for the periods presented. Results of operations for the three and nine months ended March 31, 2022, are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or any other period. These financial statements should be read in conjunction with the Company’s 2020 audited financial statements and notes thereto which were filed on Form 10-K on March 25, 2022. 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 auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, 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 financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Deferred offering costs Deferred offering costs consist of underwriting, legal, accounting and other expenses incurred through the balance sheet date that are directly related to the Initial Public Offering (as described in Note 4) and that were charged to stockholder’s equity upon the completion of the Initial Public Offering. Net loss per share The Company complies with accounting and disclosure requirements of ASC Topic 260, “Earnings Per Share.” Net loss per share is computed by dividing net loss by the weighted average number of common stock outstanding during the period, excluding common stock subject to forfeiture. At March 31, 2022, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted loss per share is the same as basic loss per share for the periods presented. Cash Equivalents and Concentration of Cash Balance The Company considers all highly liquid securities with an original maturity of less than three months to be cash equivalents. The Company’s cash and cash equivalents in bank deposit accounts, at times, may exceed federally insured limit of $250,000. As of March 31, 2022 and 2021, the Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such account. 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 Measurements,” approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature. Derivative financial instruments The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, "Derivatives and Hedging". For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date. Warrant Liability The Company accounts for the Warrants in accordance with the guidance contained in ASC 815-40-15-7D and 7F under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjust the Warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statement of operations. The Private Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrant quoted market price was used as the fair value as of each relevant date. Income Taxes The Company uses the liability method of accounting for income taxes as set forth in ASC 740, Income Taxes The Company assesses its income tax positions and record tax benefits for all years subject to examination based upon our evaluation of the facts, circumstances and information available at the reporting date. In accordance with ASC 740-10, for those tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, the Company’s policy is to record the largest amount of tax benefit that is more likely than not to be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit will be recognized in the financial statements. The Company has evaluated its income tax positions and has determined that it does not have any uncertain tax positions. As of January 20, 2021, through March 31, 2022, the Company will recognize interest and penalties related to any uncertain tax positions through its income tax expense. The Company accounts for income taxes with the recognition of estimated income taxes payable or refundable on income tax returns for the current period and for the estimated future tax effect attributable to temporary differences and carry forwards. Measurement of deferred income items is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized in the immediate future. The Company expects to file U.S. federal and various state income tax returns. The Company was formed in 2021 and has not been required to file any tax returns. All tax periods since inception remain open to examination by the taxing jurisdictions to which the Company is subject. The provision for income taxes was deemed to be de minimis for the as of March 31, 2022. Recently issued accounting pronouncements Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements. |
INITIAL PUBLIC OFFERING
INITIAL PUBLIC OFFERING | 3 Months Ended |
Mar. 31, 2022 | |
INITIAL PUBLIC OFFERING | |
Initial Public Offering | NOTE 3: INITIAL PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 10,000,000 Units at a purchase price of $10.00 per Unit. Each Unit consists of one 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 common stock at an exercise price of $11.50 (see Note 6). |
PRIVATE PLACEMENT
PRIVATE PLACEMENT | 3 Months Ended |
Mar. 31, 2022 | |
INITIAL PUBLIC OFFERING | |
Private Placement | NOTE 4: PRIVATE PLACEMENT Simultaneously with the closing of Initial Public Offering, the Sponsor purchased an aggregate of 3,800,000 Private Warrants (or 4,100,000 Private Warrants if the underwriters’ over-allotment is exercised in full) at a price of $1.00 per Private Warrant for $3,800,000 in the aggregate. The Sponsor has agreed to purchase an additional aggregate amount of 300,000 Private Warrants, for $300,000 in the aggregate if the underwriters’ over-allotment is exercised in full. The proceeds from the sale of the Private Warrants were added to the net proceeds from the Initial Public Offering held in the Trust Account. The term of the Private Warrants are described in Note 8. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Warrants will expire worthless. |
SHAREHOLDERS EQUITY
SHAREHOLDERS EQUITY | 3 Months Ended |
Mar. 31, 2022 | |
Shareholder's Equity | |
Shareholder's Equity | NOTE 5: SHAREHOLDER’S EQUITY Preferred Stock - Class A Common Stock Class B Common Stock Transfer of Founders’ Shares On March 22, 2020, our Sponsor transferred 5,000 shares of Class B common stock with a par value of $0.0001 per share to each of three of our independent directors. The number of shares of Class B common stock that our Sponsor holds after the transfer is 2,860,000 (of which 375,000 of such shares are subject to forfeiture to the extent that the underwriter’s over-allotment option is not exercised in full). Representative Shares On March 22, 2021, we issued the 100,000 shares of Class B common stock to the representative for nominal consideration (the “Representative Shares”). The Company accounted for the Representative Shares as an offering cost of the Initial Public Offering, with a corresponding credit to stockholders’ equity. The Company estimated the fair value of Representative Shares to be $1,000 based upon the price of the Founder Shares issued to the Sponsor. The holders of the Representative Shares have agreed not to transfer, assign or sell any such shares until the completion of a Business Combination. In addition, the holders have agreed (i) to waive their redemption rights with respect to such shares in connection with the completion of a Business Combination and (ii) to waive their rights to liquidating distributions from the Trust Account with respect to such shares if the Company fails to complete a Business Combination within the Combination Period. The Representative Shares have been deemed compensation by FINRA and are therefore subject to a lock-up for a period of 180 days immediately following the effective date of the registration statement related to the Initial Public Offering pursuant to Rule 5110(e)(1) of FINRA’s NASD Conduct Rules. Pursuant to FINRA Rule 5110(e)(1), these securities will not be the subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities by any person for a period of 180 days immediately following the effective date of the registration statements related to the Initial Public Offering, nor may they be sold, transferred, assigned, pledged or hypothecated for a period of 180 days immediately following the effective date of the registration statements related to the Initial Public Offering except to any underwriter and selected dealer participating in the Initial Public Offering and their bona fide officers or partners. Founder Shares On January 22, 2021 the Company issued the Sponsor an aggregate of 2,875,000 shares of Class B common stock (the “Founder Shares”) for an aggregate purchase price of $25,000. The Founder Shares include an aggregate of up to 375,000 shares subject to forfeiture by the Sponsor to the extent that the underwriter’s over-allotment is not exercised in full or in part, so that the Sponsor owns, 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). The Sponsor agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur of: (1) one year after the completion of a Business Combination or (B) subsequent to a Business Combination, (x) if the last reported 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. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2022 | |
RELATED PARTY TRANSACTIONS | |
Related Party Transactions | NOTE 6: RELATED PARTY TRANSACTIONS 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 could, but were not obligated to, loan the Company funds as may be required, of which up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant (“Working Capital Loans”). During the period ended, $760,000 has been advanced and repaid and as of March 31, 2022 and 2021, $0 is outstanding. The advance bears no interest rate. Administrative Services Arrangement The Company’s Sponsor agreed, commencing from the date that the Company’s securities are first listed on NASDAQ through the earlier of the Company’s consummation of a Business Combination and its liquidation, to make available to the Company certain general and administrative services, including office space, utilities and administrative services, as the Company may require from time to time. The Company agreed to pay the Sponsor $10,000 per month for these services. As of March 31, 2022 and 2021, $30,000 and $0 have been paid under this agreement. Promissory Note — Related Party On March 22, 2021, the Sponsor agreed to loan the Company an aggregate of up to $800,000 to cover expenses related to Initial Public Offering pursuant to a promissory note (the "Note"). This loan was non-interest bearing and payable in full on or before March 22, 2022 or could be converted into equity on March 22, 2022. During the period ended, $485,900 has been advanced and repaid and as of March 31, 2022, $0 is outstanding. |
WARRANTS
WARRANTS | 3 Months Ended |
Mar. 31, 2022 | |
WARRANTS | |
Warrants | NOTE 7: WARRANTS Warrants The Company will not be obligated to deliver any Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the Class A common stock underlying the warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration, or a valid exemption from registration is available. No warrant will be exercisable and the Company will not be obligated to issue a Class A common stock upon exercise of a warrant unless the 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 20 business days, after the closing of a Business Combination, it will use its commercially reasonable efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Class A common stock issuable upon exercise of the warrants. The Company will use its best efforts to cause the same to become effective and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the warrants in accordance with the provisions of 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 sixtieth (60th) business day after the closing of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if shares of Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elect, it will not be required to file or maintain in effect a registration statement, and in the event the Company does not so elect, it will use its best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. Once the warrants become exercisable, the Company may redeem the outstanding 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, or the 30-day redemption period, to each warrant holder; and ● if, and only if, the reported last sale 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 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 it 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, 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 shares of Class A common stock issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a stock 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 Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per 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 its 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 a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of its Class A ordinary shares during the 20 trading day period starting on the trading day after the day on which the Company consummates its 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 will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. The Private Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Warrants and the Class A common stock issuable upon the exercise of the Private 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 Warrants will be exercisable on a cashless basis and be non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private 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 MEASUREMENTS | |
Fair Value Measurements | NOTE 8: FAIR VALUE MEASUREMENTS The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. At March 31, 2022 and 2021, assets held in the Trust Account were comprised of 16,069,617 and $101,000,000 in money market funds which are invested primarily in U.S. Treasury Securities. Through March 31, 2022, the Company has not withdrawn any of interest earned on the Trust Account. 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 2021 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: Description Level March 31, 2022 March 31, 2021 Assets: Marketable securities held in Trust Account 1 $ 16,069,617 $ 101,000,000 Liabilities: Warrant Liability – Public Warrants 3 785,250 3,850,000 Warrant Liability – Private Warrants 3 585,244 2,926,000 The Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on our accompanying March 31, 2022 and 2021 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 statement of operations. The Private Warrants were initially valued using a Modified Black Scholes Option Pricing Model, which is considered to be a Level 3 fair value measurement. The Modified Black Scholes model’s primary unobservable input utilized in determining the fair value of the Private Warrants is the expected volatility of the common stock. The expected volatility as of the IPO date 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. A Monte Carlo simulation methodology was used in estimating the fair value of the Public Warrants for periods where no observable traded price was available, using the same expected volatility as was used in measuring the fair value of the Private Warrants. For periods subsequent to the detachment of the warrants from the Units, the close price of the public warrant price was used as the fair value as of each relevant date. The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrant Liabilities Fair value as of January 1, 2021 $ - $ - $ - Initial measurement on March 19, 2021 3,610,000 4,700,000 8,310,000 Change in valuation inputs or other assumptions (684,000 ) (850,000 ) (1,534,000 ) Fair value as of March 31, 2021 2,926,000 3,850,000 6,776,000 Private Placement Public Warrant Liabilities Fair value as of January 1, 2022 $ 2,262,941 $ 3,036,301 $ 5,299,242 Change in valuation inputs or other assumptions (1,677,697 ) (2,251,051 ) (3,928,748 ) Fair value as of March 31, 2022 585,244 785,250 1,370,494 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
Commitments And Contingencies | NOTE 9: COMMITMENTS AND CONTINGENCIES In the course of normal operations, the Company may be involved in various claims and litigation that management intends to defend. The range of loss, if any, from potential claims cannot be reasonably estimated. However, management believes the ultimate resolution of matters will not have a material adverse impact on the Company’s business or financial position. Registration Rights The holders of the insider shares, as well as the holders of the Private Warrants (and underlying securities) and any securities issued in payment of working capital loans made to the Company, will be entitled to registration rights pursuant to an agreement to be signed on the effective date of Initial Public Offering. The holders of a majority of these securities are entitled to make up to three demands that the Company register such securities. Notwithstanding anything to the contrary, the underwriters (and/or their designees) may only make a demand registration (i) on one occasion and (ii) during the five-year period beginning on the effective date of the Initial Public Offering. The holders of the majority of the insider shares can elect to exercise these registration rights at any time commencing upon the date that the Company consummates a Business Combination. The holders of a majority of the Private Warrants (and underlying securities) and securities issued in payment of working capital loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the consummation of a Business Combination. Notwithstanding anything to the contrary, the underwriters (and/or their designees) may participate in a “piggy-back” registration only during the seven-year period beginning on the effective date of the Initial Public Offering. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Underwriting Agreement The Company granted the underwriters a 45-day option to purchase up to 1,500,000 additional Units to cover over-allotments at the Initial Public Offering price, less the underwriting discounts and commissions. The underwriters are entitled to a cash underwriting discount of one percent (1.00%) of the gross proceeds of the Initial Public Offering, or $1,000,000 (or up to $1,150,000 if the underwriters’ over-allotment is exercised in full). In addition, the underwriters are entitled to a deferred fee of three point five percent (3.50%) of the gross proceeds of the Initial Public Offering, or $3,500,000 (or up to $4,025,000 if the underwriters’ over- allotment is exercised in full) upon closing of the Business Combination. The deferred fee will be paid in cash upon the closing of a Business Combination from the amounts held in the Trust Account, subject to the terms of the underwriting agreement. Right of First Refusal For a period beginning on the closing of this offering and ending 24 months from the closing of a business combination, we have granted the Representative a right of first refusal to act as sole book runner, and/or sole placement agent, at the representative’s sole discretion, for each and every future public and private equity and debt offering, including all equity linked financings for us or any of our successors or subsidiaries. In accordance with FINRA Rule 5110(f)(2)(E)(i), such right of first refusal shall not have a duration of more than three years from the effective date of the registration statement of which this prospectus forms a part. Forward Share Purchase Agreements Effective March 25, 2022, American Acquisition Opportunity Inc., a Delaware corporation (“AMAO” or the “Company”), and certain accredited investors in the Company (the “Investors”) entered into Forward Share Purchase Agreements (each, a “Purchase Agreement” and collectively, the “Purchase Agreements”), pursuant to which the Investors may each individually elect to sell and transfer to the Company via redemption on the earlier of (a) the closing of the Company’s initial business combination (the “Business Combination”), and (b) September 22, 2022 (the “Extended Date”), the amount of shares of the Company’s Class A common stock (“Shares”) identified in each Purchase Agreement, for an aggregate purchase price of $10.35 per Share (the “Shares Purchase Price”). Collectively, the Investors hold 1,123,499 Shares subject to the Purchase Agreements. If an Investor provides a timely notice of an election to sell or redeem Shares, the Company will pay the Shares Purchase Price for each eligible Share as follows: (a) 0.25 for each Share being sold by such selling Investor to be delivered by the escrow agent appointed by the parties (the “Escrow Agent”) from an escrow account established by the parties the Purchase Agreements (the “Escrow Account”) and (B) $10.10 for each Share being sold by such selling Investor to be delivered in the form of a redemption payment from the trustee of the trust account established in conjunction with the closing of the Company’s initial public offering. The Company has agreed to deposit $280,874.75 into the Escrow Account to satisfy payment of the Shares Purchase Price for all Investors. In order to be eligible to receive the Shares Purchase Price, the Investors must continuously hold such Shares unless Shares are sold in open market sales at a price per Share greater than $10.35 and such sold Shares are replaced by other Shares purchased in the open market. If an Investor fails to timely notify the Company of its election to sell or redeem Shares, such Investor will have forfeited its right to sell or redeem Shares. In exchange for the Company’s commitment to purchase or redeem the Shares at the Shares Purchase Price, each Investor agreed (i) not to request redemption of any of the Shares in conjunction with the Company’s approval of the Extension Proposal (as described in Item 5.07), and (ii) to withdraw any prior redemption requests with respect to the amount of Shares subject the applicable Purchase Agreement. The Company agreed that it would not enter into any agreements with additional redeeming holders of its Shares containing material terms that are more favorable to such additional redeeming holders than the terms offered to the Investors, provided, however, that if the Company did provide more favorable terms to a third party, the Company would promptly advise the Investors and provide them with a right to amend the Purchase Agreements to include such more favorable terms. In the event that an Investor fails to timely deliver a notice of its election to sell or redeem Shares, exercises its election with respect to only a portion of the Shares, or fails to continuously hold some or all Shares, subject to the exception for open market sales and repurchases (the total amount Shares that are consequently not required to be purchased or redeemed by the Company, the “Retained Shares”), then, within five business days of the Extended Date, the parties to each Purchase Agreement shall instruct the Escrow Agent to release an amount equal to $0.25 multiplied by the number of Retained Shares to the Company. The Purchase Agreements contain customary representations, warranties and covenants from the parties. The Company agreed to indemnify each Investor and its respective officers, directors, employees, agents and shareholders (collectively referred to as the “Indemnitees”) against, and hold them harmless of and from, any and all loss, liability, cost, damage and expense, including without limitation, reasonable and documented out-of-pocket outside counsel fees, which the Indemnitees may suffer or incur by reason of any action, claim or proceeding, in each case, brought by a third party creditor of the Company asserting that an Investor is not entitled to receive the aggregate Share Purchase Price or such portion thereof as they are entitled to receive pursuant to a Purchase Agreement, in each case unless such action, claim or proceeding is the result of the fraud, bad faith, willful misconduct or gross negligence of any Indemnitee. As of March 31, 2022, cash held in escrow for the settlement of the forward purchase agreement was $280,875. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2022 | |
SUBSEQUENT EVENTS | |
Subsequent Events | NOTE 10: SUBSEQUENT EVENTS |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis Of Presentation | The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC. The Company adopted the calendar year as its basis of reporting. |
Interim Financial Information | Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. In the opinion of management, these interim unaudited Consolidated Financial Statements reflect all normal and recurring adjustments necessary for a fair presentation of the results for the periods presented. Results of operations for the three and nine months ended March 31, 2022, are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or any other period. These financial statements should be read in conjunction with the Company’s 2020 audited financial statements and notes thereto which were filed on Form 10-K on March 25, 2022. |
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 auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, 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 financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Deferred Offering Costs | Deferred offering costs consist of underwriting, legal, accounting and other expenses incurred through the balance sheet date that are directly related to the Initial Public Offering (as described in Note 4) and that were charged to stockholder’s equity upon the completion of the Initial Public Offering. |
Net Loss Per Share | The Company complies with accounting and disclosure requirements of ASC Topic 260, “Earnings Per Share.” Net loss per share is computed by dividing net loss by the weighted average number of common stock outstanding during the period, excluding common stock subject to forfeiture. At March 31, 2022, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted loss per share is the same as basic loss per share for the periods presented. |
Cash Equivalents And Concentration Of Cash Balance | The Company considers all highly liquid securities with an original maturity of less than three months to be cash equivalents. The Company’s cash and cash equivalents in bank deposit accounts, at times, may exceed federally insured limit of $250,000. As of March 31, 2022 and 2021, the Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such account. |
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 Measurements,” approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature. |
Derivative Financial Instruments | The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, "Derivatives and Hedging". For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date. |
Warrant Liability | The Company accounts for the Warrants in accordance with the guidance contained in ASC 815-40-15-7D and 7F under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjust the Warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statement of operations. The Private Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrant quoted market price was used as the fair value as of each relevant date. |
Income Taxes | The Company uses the liability method of accounting for income taxes as set forth in ASC 740, Income Taxes The Company assesses its income tax positions and record tax benefits for all years subject to examination based upon our evaluation of the facts, circumstances and information available at the reporting date. In accordance with ASC 740-10, for those tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, the Company’s policy is to record the largest amount of tax benefit that is more likely than not to be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit will be recognized in the financial statements. The Company has evaluated its income tax positions and has determined that it does not have any uncertain tax positions. As of January 20, 2021, through March 31, 2022, the Company will recognize interest and penalties related to any uncertain tax positions through its income tax expense. The Company accounts for income taxes with the recognition of estimated income taxes payable or refundable on income tax returns for the current period and for the estimated future tax effect attributable to temporary differences and carry forwards. Measurement of deferred income items is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized in the immediate future. The Company expects to file U.S. federal and various state income tax returns. The Company was formed in 2021 and has not been required to file any tax returns. All tax periods since inception remain open to examination by the taxing jurisdictions to which the Company is subject. The provision for income taxes was deemed to be de minimis for the as of March 31, 2022. |
Recently Issued Accounting Pronouncements | Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
FAIR VALUE MEASUREMENTS | |
Schedule Of Fair Value Assets And Liabilities Measured On Recurring Basis | Description Level March 31, 2022 March 31, 2021 Assets: Marketable securities held in Trust Account 1 $ 16,069,617 $ 101,000,000 Liabilities: Warrant Liability – Public Warrants 3 785,250 3,850,000 Warrant Liability – Private Warrants 3 585,244 2,926,000 |
Schedule Of Changes In The Fair Value Of Warrant Liabilities | Private Placement Public Warrant Liabilities Fair value as of January 1, 2021 $ - $ - $ - Initial measurement on March 19, 2021 3,610,000 4,700,000 8,310,000 Change in valuation inputs or other assumptions (684,000 ) (850,000 ) (1,534,000 ) Fair value as of March 31, 2021 2,926,000 3,850,000 6,776,000 Private Placement Public Warrant Liabilities Fair value as of January 1, 2022 $ 2,262,941 $ 3,036,301 $ 5,299,242 Change in valuation inputs or other assumptions (1,677,697 ) (2,251,051 ) (3,928,748 ) Fair value as of March 31, 2022 585,244 785,250 1,370,494 |
NATURE OF OPERATIONS (Details N
NATURE OF OPERATIONS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
Mar. 22, 2021 | Mar. 31, 2022 | Dec. 31, 2021 | |
Gross Proceeds Of Intial Public Offer | $ 100,000,000 | ||
Price Per Share | $ 10 | ||
Initial Public Offering Price | $ 10.10 | ||
Deferred Underwriter Fees | $ 3,500,000 | $ 3,500,000 | $ 3,500,000 |
Percentage Of Fair Market Value | 80.00% | ||
Acquires Outstanding Voting Securities In Percentage | 50.00% | ||
Proceeds Received From Intial Public Offer | $ 101,000,000 | ||
Total Transaction Cost | 4,910,297 | ||
Underwriting Fees | 1,000,000 | ||
Other Offering Cost | 410,297 | ||
Net Proceeds Of Intial Public Offer | 101,000,000 | ||
Intangible Assets Amount Upon Business Combination | $ 5,000,001 | ||
Redemption Right Descriptions | Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from seeking redemption rights with respect to 15% or more of the Public Shares without the Company’s prior written consent | ||
Business Combination Descriptions | 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 no more than five business days thereafter, redeem 100% of the outstanding 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 (net of taxes payable and less interest to pay dissolution expenses up to $100,000), 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 liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining stockholders and the Company’s board of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject in each case to its obligations to provide for claims of creditors and the requirements of applicable law. The underwriter has agreed to waive its rights to the deferred underwriting commission 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 funds held in the Trust Account that will be available to fund the redemption of the Public Shares. | ||
Private Placement [Member] | |||
Price Per Share | $ 1 | ||
Intial Public Offer Shares Sold | 10,000,000 | ||
Sale Of Private Placement | 3,800,000 | ||
Gross Proceeds From Sale Of Private Placement | $ 3,800,000 | $ 3,800,000 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative)) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Federal Insured Limit | $ 250,000 | $ 250,000 |
Income Tax Descriptions | tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, the Company’s policy is to record the largest amount of tax benefit that is more likely than not to be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit will be recognized in the financial statements |
INITIAL PUBLIC OFFERING (Detail
INITIAL PUBLIC OFFERING (Details Narrative)) | Mar. 31, 2022$ / sharesshares |
Warrants Exercise Price | $ 0.01 |
Private Placement [Member] | |
Initial Public Offering | shares | 10,000,000 |
Purchase Price Per Share | $ 10 |
Warrants Exercise Price | $ 11.50 |
PRIVATE PLACEMENT (Details Narr
PRIVATE PLACEMENT (Details Narrative)) - Private Placement [Member] - USD ($) | 1 Months Ended | 3 Months Ended |
Mar. 22, 2021 | Mar. 31, 2022 | |
Aggregate Amount Of Placement Unit | 3,800,000 | |
Price Per Share | $ 1 | |
Gross Proceeds From Sale Of Private Placement | $ 3,800,000 | $ 3,800,000 |
Additional Shares Purchase Of Placement Units, Shares | 300,000 | |
Additional Shares Purchase Of Placement Units, Amount | $ 300,000 |
SHAREHOLDERS EQUITY (Details Na
SHAREHOLDERS EQUITY (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Jan. 22, 2021 | Mar. 31, 2022 | Mar. 22, 2021 | Mar. 22, 2020 | |
Class A Common Stock, Par Value | $ 10.10 | |||
Preferred Stock [Member] | ||||
Preferred Stock, Shares Authorized | 1,000,000 | |||
Preferred Stock Par Value | $ 0.0001 | |||
Class A Common Stock [Member] | ||||
Common Stock, Shares Authorized | 100,000,000 | |||
Class A Common Stock, Par Value | $ 0.0001 | |||
Common Stock, Shares Issued | 1,563,242 | |||
Description Of Common Stock Shares | 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 | |||
Class A Common Stock, Shares Outstanding | 1,563,242 | 1,563,242 | ||
Class B Common Stock [Member] | ||||
Common Stock, Shares Authorized | 10,000,000 | |||
Class A Common Stock, Par Value | $ 0.0001 | $ 0.0001 | ||
Common Stock, Shares Issued | 2,726,500 | 2,975,000 | ||
Class A Common Stock, Shares Outstanding | 2,726,500 | 2,975,000 | ||
Common Stock Shares, Subject To Possible Redemption | 2,875,000 | 2,875,000 | ||
Shares Transfer | 5,000 | |||
Common Stock Shares Hold | 2,860,000 | |||
Shares, Subject To Forfeiture | 375,000 | |||
Representative Shares, Issued | 100,000 | 100,000 | ||
Fair Value Of Representative Shares | $ 1,000 | |||
Founder Shares, Issued | 2,875,000 | |||
Aggregate Purchase Price | $ 25,000 | |||
Common Stock, Subject To Forfeiture | 375,000 | |||
Ownership Percentage | 20.00% |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Mar. 22, 2021 | |
Administrative Services Arrangement Paid Amount | $ 30,000 | $ 0 | |
Related Party Loans | $ 1,500,000 | ||
Warrant Convertible Price Per Share | $ 1 | ||
Advance From Related Party Loans | $ 760,000 | ||
Related Party, Amount Outstanding | 0 | $ 0 | |
Sponsor [Member] | |||
Related Party Loans | $ 800,000 | ||
Advance From Related Party Loans | 485,900 | ||
Service Expenses | $ 10,000 |
WARRANTS (Details Narrative)
WARRANTS (Details Narrative) | 3 Months Ended |
Mar. 31, 2022$ / shares | |
Price Per Warrant | $ 0.01 |
Class A Common Stock [Member] | |
Description Of Warrants | the reported last sale 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 the notice of redemption to the warrant holders |
Issuance Price Per Share | $ 9.20 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | Mar. 31, 2022 | Mar. 31, 2021 |
Level 1 [Member] | ||
Marketable Securities Held In Trust Account | $ 16,069,617 | $ 101,000,000 |
Level 3 [Member] | Public Warrant [Member] | ||
Warrant Liability | 785,250 | 3,850,000 |
Level 3 [Member] | Private Warrant [Member] | ||
Warrant Liability | $ 585,244 | $ 2,926,000 |
FAIR VALUE MEASUREMENTS (Deta_2
FAIR VALUE MEASUREMENTS (Details 1) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Warrant Liabilities [Member] | ||
Fair Value Of Warrant Liabilities, Beginning | $ 5,299,242 | $ 0 |
Initial Measurement On March 19, 2021 | 8,310,000 | |
Change In Valuation Inputs Or Other Assumptions | (3,928,748) | (1,534,000) |
Fair Value Of Warrant Liabilities, Ending | 1,370,494 | 6,776,000 |
Private Placement [Member] | ||
Fair Value Of Warrant Liabilities, Beginning | 2,262,941 | 0 |
Initial Measurement On March 19, 2021 | 3,610,000 | |
Change In Valuation Inputs Or Other Assumptions | (1,677,697) | (684,000) |
Fair Value Of Warrant Liabilities, Ending | 585,244 | 2,926,000 |
Public [Member] | ||
Fair Value Of Warrant Liabilities, Beginning | 3,036,301 | 0 |
Initial Measurement On March 19, 2021 | 4,700,000 | |
Change In Valuation Inputs Or Other Assumptions | (2,251,051) | (850,000) |
Fair Value Of Warrant Liabilities, Ending | $ 785,250 | $ 3,850,000 |
FAIR VALUE MEASUREMENTS (Deta_3
FAIR VALUE MEASUREMENTS (Details Narrative) - USD ($) | Mar. 31, 2022 | Mar. 31, 2021 |
FAIR VALUE MEASUREMENTS | ||
Cash Held In Trust Account | $ 16,069,617 | $ 101,000,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Mar. 22, 2021 | Mar. 31, 2022 | Sep. 22, 2022 | Dec. 31, 2021 | |
Holding Shares | 1,123,499 | |||
Settlement Of The Forward Purchase Agreement | $ 280,875 | |||
Market Price | $ 0.25 | |||
Class A Common Stock, Par Value | $ 10.10 | |||
Gross Proceeds Of Intial Public Offer | $ 100,000,000 | |||
Deferred Underwriter Commissions | $ 3,500,000 | $ 3,500,000 | $ 3,500,000 | |
Aggregate Purchase Price | $ 10 | |||
Escrow Agent [Member] | ||||
Agreed To Deposit | $ 280,874 | |||
Aggregate Purchase Price | $ 0.25 | |||
Underwriting Agreement [Member] | Intial Public Offer [Member] | ||||
Agreement Descriptions | The Company granted the underwriters a 45-day option to purchase up to 1,500,000 additional Units to cover over-allotments at the Initial Public Offering price, less the underwriting discounts and commissions | |||
Cash Underwriting Discount, Percentage | 1.00% | |||
Gross Proceeds Of Intial Public Offer | $ 1,000,000 | |||
Gross Proceeds Of Intial Public Offer, Maximum Amount | $ 1,150,000 | |||
Deferred Underwriting Discount, Percentage | 3.50% | |||
Deferred Underwriter Commissions | $ 3,500,000 | |||
Deferred Underwriter Commissions, Maximum Amount | $ 4,025,000 |