| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES Basis of Presentation The accompanying unaudited condensed consolidated
financial statements of the Company 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 consolidated 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 consolidated
financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K as filed with the SEC on March
24, 2023. The interim results for the three and six months ended June 30, 2023 are not necessarily indicative of the results to be expected
for the year ended December 31, 2023 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 of 1933 (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 registered 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 Securities Exchange Act of 1934, as amended (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 statement 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. The Company will remain an emerging growth company
until the earliest of (i) the last day of the first fiscal year (a) following the fifth anniversary of the completion of the Initial Public
Offering, (b) in which the Company’s total annual gross revenue is at least $1.235 billion or (c) when the Company is deemed to
be a large accelerated filer, which means the market value of the Company’s common stock that is held by non-affiliates exceeds
$700.0 million as of the prior June 30th and (ii) the date on which the Company has issued more than $1.0 billion in non-convertible debt
securities during the prior three-year period. Principles of Consolidation The accompanying condensed consolidated financial
statements include the accounts of the Company and its wholly owned subsidiary. All significant intercompany balances and transactions
have been eliminated in consolidation. Use of Estimates The preparation of the condensed consolidated
financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated
financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise
significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances
that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near
term due to one or more future confirming events. One of the more significant accounting estimates included in these condensed consolidated
financial statements is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more
current information becomes available and 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. Cash held outside of the trust was $1,201,271
and $195,339 at June 30, 2023 and December 31, 2022, respectively. The Company did not have any cash equivalents as of June 30, 2023 and
December 31, 2022. Marketable Securities Held in Trust Account At June 30, 2023 and December 31, 2022, substantially
all of the assets held in the Trust Account were held in money market funds, which are invested primarily in U.S. Treasury securities.
For the six months ended June 30, 2023 and 2022, the Company withdrew $2,951,390 and $0 from the Trust Account to fund Permitted Withdrawals,
respectively. All of the Company’s investments held in
the Trust Account are classified as trading securities. Trading securities are presented on the balance sheet at fair value at the end
of each reporting period. Gains and losses resulting from the change in fair value of investments held in Trust Account are included in
interest earned on marketable securities held in Trust Account in the accompanying statements of operations. The estimated fair values
of investments held in Trust Account are determined using available market information. Warrant Liabilities The Company does not use derivative instruments
to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including
issued share purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives,
pursuant to Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification Topic 815-40, “Derivatives
and Hedging” (“ASC 815-40”). The classification of derivative instruments, including whether such instruments should
be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. The Company accounts for the Public Warrants
(as defined in Note 4) and the Private Placement Warrants (collectively, with the Public Warrants, the “Warrants”) in accordance
with the guidance contained in ASC 815-40 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 adjusts 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 the statements of operations. The Warrants for periods where no observable traded price was available are valued
using a binomial/lattice model. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrant quoted
market price will be used as the fair value as of each relevant date. 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 480 “Distinguishing Liabilities from Equity.” Shares
of 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 common stock that features redemption rights that is 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 Class A 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, as of June 30, 2023 and December 31, 2022, 17,250,000 shares of Class A common stock subject to possible redemption is presented
at redemption value as temporary equity, outside of the stockholders’ deficit section of the Company’s condensed consolidated
balance sheets. Immediately upon the closing of the Initial Public
Offering, the Company recognized the re-measurement from initial book value to redemption amount, which approximates fair value. The change
in the carrying value of the redeemable Class A common stock subject to possible redemption resulted in charges against additional paid-in
capital (to the extent available), accumulated deficit and Class A common stock. 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. Increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid in capital
(to the extent available), accumulated deficit and Class A Common stock. At June 30, 2023 and December 31, 2022, the Class
A Common stock subject to possible redemption reflected in the condensed consolidated balance sheets are reconciled in the following table:
Gross proceeds $ 172,500,000
Less:
Proceeds allocated to Public Warrants (5,462,500 )
Class A common stock issuance costs (9,447,180 )
Plus:
Re-measurement of carrying value to redemption value 14,909,680
Class A common stock subject to possible redemption, December 31, 2021 172,500,000
Plus:
Re-measurement of carrying value to redemption value 534,002
Class A common stock subject to possible redemption, December 31, 2022 173,034,002
Plus:
Re-measurement of carrying value to redemption value 333,395
Class A common stock subject to possible redemption, March 31, 2023 173,367,397
Plus:
Re-measurement of carrying value to redemption value 1,451,825
Class A common stock subject to possible redemption, June 30, 2023 $ 174,819,222 Offering Costs The Company complies with the requirements of
the Accounting Standards Codification Topic 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A – Expenses
of Offering. Offering costs consist of underwriting, legal, accounting and other expenses incurred through the Initial Public Offering
that are directly related to the Initial Public Offering. Offering costs are allocated to the separable financial instruments issued in
the Initial Public Offering based on a relative fair value basis, compared to total proceeds received. Offering costs associated with
derivative warrant liabilities are expensed as incurred, presented as non-operating expenses in the statement of operations. Offering
costs associated with the issuance of Public Shares amounting to $9,618,180 are included in the re-measurement for Class A common stock
subject to redemption amount. The Company paid the underwriters a cash fee of $3,450,000 at the Initial Public Offering date. In addition,
the underwriters were entitled to a deferred fee of $0.35 per Unit, or $6,037,500. The deferred fee was to be 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 (as defined below). In connection with the Company’s Business Combination , the UW Representative (as defined
below) agreed, pursuant to a letter agreement dated March 9, 2023, that in the Company’s discretion, the Company could reallocate
a portion of the “Deferred Discount,” as such term is defined in the Underwriting Agreement, to one or more third parties
not participating in the Initial Public Offering; provided that the UW Representative is paid at least an agreed minimum amount of the
Deferred Discount at the closing, if any, of the Business Combination. Offering costs associated with the derivative warrant liabilities
amounting to $290,432 in the second quarter of 2021, and $39,187 in the third quarter of 2021, totaling $329,619 for the period from February
12, 2021 (inception) through December 31, 2021, were expensed to the statement of operations. The Company classifies deferred underwriting
commissions as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or require
the creation of current liabilities. Income Taxes The Company accounts for income taxes under ASC
740, “Income Taxes.” (“ASC 740”), which requires the recognition of deferred tax assets and liabilities for both
the expected impact of differences between the unaudited condensed consolidated financial statements and tax basis of assets and liabilities
and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation
allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized. As of June
30, 2023 and December 31, 2022, the Company’s deferred tax asset had a full valuation allowance recorded against it. The Company’s
effective tax rate was (8.06)% and 0.68% for the three months ended June 30, 2023 and 2022, respectively, and (12.55)% and 0.29% for the
six months ended June 30, 2023 and 2022, respectively. The effective tax rate differs from the statutory tax rate of 21% for the three
and six months ended June 30, 2023 and 2022, due to changes in fair value in warrant liability, M&A expenses subsequent to signing
of a letter of intent (“LOI”), and the valuation allowance on the deferred tax assets. ASC 740 also clarifies the accounting for uncertainty
in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process
for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits
to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. ASC 740 also provides
guidance on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition. The Company recognizes accrued interest and penalties
related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest
and penalties as of June 30, 2023 and December 31, 2022. 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 has identified the United States as
its only “major” tax jurisdiction. The Company is subject to income taxation by major taxing authorities since inception.
These examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and
compliance with federal and state tax laws. The Company’s management does not expect that the total amount of unrecognized tax benefits
will materially change over the next twelve months. Net (loss) income per Common Share Net (loss) income per common share is computed
by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Re-measurement associated with
the redeemable shares of Class A common stock is excluded from (loss) income per common share as the redemption value approximates fair
value. The calculation of diluted (loss) income per common
share does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, and (ii) the private placement
to purchase an aggregate of 11,450,000 shares of common stock in the calculation of diluted (loss) income per common share, since the
exercise of the warrants is contingent upon the occurrence of future events. For the periods ended June 30, 2023 and 2022, the Company
did not have any other dilutive securities or other contracts that could, potentially, be exercised or converted into shares of common
stock and then share in the earnings of the Company. As a result, diluted net (loss) income per common stock is the same as basic net
(loss) income per common share for the period presented. The following table reflects the calculation
of basic and diluted net (loss) income per common share (in dollars, except per share amounts):
For the Three Months Ended For the Six Months Ended
2023 2022 2023 2022
Class A Class B Class A Class B Class A Class B Class A Class B
Basic and diluted net (loss) income per common share
Numerator:
Allocation of net (loss) income $ (6,099,783 ) $ (1,524,946 ) $ 1,555,621 $ 388,905 $ (7,421,662 ) $ (1,855,415 ) $ 3,623,642 $ 905,911 )
Denominator:
Basic and diluted weighted average shares outstanding 17,250,000 4,312,500 17,250,000 4,312,500 17,250,000 4,312,500 17,250,000 4,312,500
Basic and diluted net (loss) income per common share $ (0.35 ) $ (0.35 ) $ 0.09 $ 0.09 $ (0.43 ) $ (0.43 ) $ 0.21 $ 0.21 Concentration of Credit Risk Financial instruments that potentially subject
the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times may exceed the Federal
Depository Insurance Coverage of $250,000, and investments held in the Trust Account. As of June 30, 2023 and December 31, 2022, the Company
has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts. Fair Value of Financial Instruments The fair value of the Company’s assets and
liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts
represented in the accompanying condensed consolidated balance sheets, primarily due to their short-term nature, except for warrant liabilities
(see Note 9). 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 815-40,
“Derivatives and Hedging”. Derivative instruments are initially recorded at fair value on the grant date and re-valued at
the end of each reporting period, with changes in the fair value reported in the statement of operations. Derivative assets and 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. 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
consolidated financial statements. |
