Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 11, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2023 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-40710 | |
Entity Registrant Name | ROTH CH ACQUISITION IV CO | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 83-3583873 | |
Entity Address, Address Line One | 888 San Clemente Drive, Suite 400 | |
Entity Address, City or Town | Newport Beach | |
Entity Address State Or Province | CA | |
Entity Address, Postal Zip Code | 92660 | |
City Area Code | 949 | |
Local Phone Number | 720-5700 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | true | |
Entity Common Stock, Shares Outstanding | 5,714,749 | |
Entity Central Index Key | 0001855447 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Transition Report | false | |
Common stock | ||
Document and Entity Information | ||
Title of 12(b) Security | Common Stock | |
Trading Symbol | ROCG | |
Security Exchange Name | NASDAQ | |
Warrants | ||
Document and Entity Information | ||
Title of 12(b) Security | Warrants | |
Trading Symbol | ROCGW | |
Security Exchange Name | NASDAQ | |
Units | ||
Document and Entity Information | ||
Title of 12(b) Security | Units | |
Trading Symbol | ROCGU | |
Security Exchange Name | NASDAQ |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
ASSETS | ||
Cash | $ 123,759 | $ 88,107 |
Prepaid expenses | 137,763 | 150,069 |
Due from certain Initial Stockholders | 135,440 | |
Total Current Assets | 261,522 | 373,616 |
Cash and marketable securities held in Trust Account | 24,601,832 | 24,678,170 |
TOTAL ASSETS | 24,863,354 | 25,051,786 |
Current liabilities: | ||
Accounts payable and accrued expenses | 948,514 | 666,832 |
Income taxes payable | 135,987 | 395,019 |
Promissory note - related party | 200,000 | |
Total Liabilities | 1,284,501 | 1,061,851 |
Commitments | ||
Stockholders' Deficit | ||
Additional paid-in capital | 88,118 | 251,389 |
Accumulated deficit | (995,032) | (583,950) |
Total Stockholders' Deficit | (906,580) | (332,227) |
TOTAL LIABILITIES, COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION, AND STOCKHOLDERS' DEFICIT | 24,863,354 | 25,051,786 |
Redeemable common stock | ||
Current liabilities: | ||
Common stock subject to possible redemption; $0.0001 par value; 2,378,249 shares at $10.30 and $10.23 redemption value at March 31, 2023 and December 31, 2022, respectively | 24,485,433 | 24,322,162 |
Non-redeemable common stock | ||
Stockholders' Deficit | ||
Common stock, $0.0001 par value; 50,000,000 shares authorized; 3,336,500 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively | $ 334 | $ 334 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Common Stock | ||
Common stock, par value, (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock subject to possible redemption value (in dollar per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock subject to possible redemption | ||
Common stock subject to possible redemption, outstanding (in shares) | 2,378,249 | 2,378,249 |
Common stock subject to possible redemption value (in dollar per share) | $ 10.30 | $ 10.23 |
Common stock subject to possible non-redemption | ||
Common stock, shares issued | 3,336,500 | 3,336,500 |
Common stock, shares outstanding | 3,336,500 | 3,336,500 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Formation and operating costs | $ 593,776 | $ 155,407 |
Loss from operations | (593,776) | (155,407) |
Other income: | ||
Interest earned on marketable securities held in Trust Account | 245,201 | 29,503 |
Unrealized gain on marketable securities held in Trust Account | 4,277 | |
Total other income, net | 245,201 | 33,780 |
Loss before provision for income taxes | (348,575) | (121,627) |
Provision for income taxes | (62,507) | |
Net loss | $ (411,082) | $ (121,627) |
Redeemable common stock | ||
Other income: | ||
Basic weighted average shares outstanding (in shares) | 2,378,249 | 11,500,000 |
Diluted weighted average shares outstanding (in shares) | 2,378,249 | 11,500,000 |
Basic net loss per share (in dollar per share) | $ (0.07) | $ (0.01) |
Diluted net loss per share (in dollar per share) | $ (0.07) | $ (0.01) |
Non-redeemable common stock | ||
Other income: | ||
Basic weighted average shares outstanding (in shares) | 3,336,500 | 3,336,500 |
Diluted weighted average shares outstanding (in shares) | 3,336,500 | 3,336,500 |
Basic net loss per share (in dollar per share) | $ (0.07) | $ (0.01) |
Diluted net loss per share (in dollar per share) | $ (0.07) | $ (0.01) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIT) EQUITY - USD ($) | Common stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at the beginning at Dec. 31, 2021 | $ 334 | $ 1,267,993 | $ (405,732) | $ 862,595 |
Balance at the beginning (in shares) at Dec. 31, 2021 | 3,336,500 | |||
CHANGES IN STOCKHOLDERS' (DEFICIT) EQUITY | ||||
Net loss | (121,627) | (121,627) | ||
Balance at the end at Mar. 31, 2022 | $ 334 | 1,267,993 | (527,359) | 740,968 |
Balance at the end (in shares) at Mar. 31, 2022 | 3,336,500 | |||
Balance at the beginning at Dec. 31, 2021 | $ 334 | 1,267,993 | (405,732) | 862,595 |
Balance at the beginning (in shares) at Dec. 31, 2021 | 3,336,500 | |||
Balance at the end at Dec. 31, 2022 | $ 334 | 251,389 | (583,950) | (332,227) |
Balance at the end (in shares) at Dec. 31, 2022 | 3,336,500 | |||
CHANGES IN STOCKHOLDERS' (DEFICIT) EQUITY | ||||
Remeasurement of common stock subject to redemption amount | (326,452) | (326,452) | ||
Contribution from Sponsor | 163,181 | 163,181 | ||
Net loss | (411,082) | (411,082) | ||
Balance at the end at Mar. 31, 2023 | $ 334 | $ 88,118 | $ (995,032) | $ (906,580) |
Balance at the end (in shares) at Mar. 31, 2023 | 3,336,500 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Cash Flows from Operating Activities: | |||
Net loss | $ (411,082) | $ (121,627) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Interest earned on marketable securities held in Trust Account | (245,201) | (29,503) | |
Unrealized gain on marketable securities held in Trust Account | (4,277) | ||
Changes in operating assets and liabilities: | |||
Prepaid expenses | 12,306 | (35,656) | |
Income taxes payable | (259,032) | ||
Prepaid insurance, long-term | 44,078 | ||
Accrued expenses | 281,682 | (122,600) | |
Net cash used in operating activities | (621,327) | (269,585) | |
Cash Flows from Investing Activities: | |||
Cash withdrawn from Trust Account to pay franchise and income taxes | 321,539 | ||
Net cash provided by investing activities | 321,539 | ||
Cash Flows from Financing Activities: | |||
Proceeds from promissory note - related party | 200,000 | ||
Reimbursement of extension payment | 135,440 | ||
Net cash provided by financing activities | 335,440 | ||
Net Change in Cash | 35,652 | (269,585) | |
Cash - Beginning of period | 88,107 | 802,606 | $ 802,606 |
Cash - End of period | 123,759 | $ 533,021 | $ 88,107 |
Non-Cash investing and financing activities: | |||
Remeasurement for common stock to redemption amount | 326,452 | ||
Extension costs related to non-redemption agreements | 163,181 | ||
Supplemental Information | |||
Income taxes paid | $ 321,539 |
DESCRIPTION OF ORGANIZATION, BU
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | 3 Months Ended |
Mar. 31, 2023 | |
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | |
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | NOTE 1. DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY Roth CH Acquisition IV Co. (the “Company”) was incorporated in Delaware on February 13, 2019. The Company is a blank check company formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (the “Business Combination”). The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. As of March 31, 2023, the Company had not commenced any operations. All the Company’s activities through March 31, 2023 related to its formation and the initial public offering (“Initial Public Offering”), which is described below, and subsequent to the Initial Public Offering, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company generates non-operating income in the form of interest income on marketable securities held in the Trust Account (as defined below). The registration statement for the Company’s Initial Public Offering was declared effective on August 5, 2021. On August 10, 2021, the Company consummated the Initial Public Offering of 11,500,000 units (the “Units” and, with respect to the shares of common stock included in the Units sold, the “Public Shares”), which included the full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at $10.00 per Unit, generating gross proceeds of $115,000,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 461,500 units (the “Private Units”) at a price of $10.00 per Private Unit in a private placement to certain of the Company’s initial stockholders, generating gross proceeds of $4,615,000, which is described in Note 4. Transaction costs amounted to $1,646,673, consisting of $1,150,000 of underwriting fees, and $496,673 of other offering costs. Following the closing of the Initial Public Offering on August 10, 2021, an amount of $116,725,000 ($10.15 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Units was placed in a trust account (the “Trust Account”), located in the United States and held in cash items or invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions 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 Trust Account, as described below. The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete a Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding taxes payable on income earned on the Trust Account) at the time of the agreement to enter into an initial Business Combination. The Company will only complete a Business Combination if the post-transaction 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. The Company will provide its holders of the outstanding Public Shares (the “public stockholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.15 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants. The Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC containing substantially the same information as would be included in a proxy statement prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by law, or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the holders of the Company’s shares prior to the Initial Public Offering (the “Initial Stockholders”) have agreed (a) to vote their Founder Shares (as defined in Note 5), Private Shares (as defined in Note 4) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination, to the extent permitted by law, and (b) not to redeem any shares in connection with a stockholder vote to approve a Business Combination or sell any shares to the Company in a tender offer in connection with a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares, irrespective of how or whether they vote on the proposed transaction or do not vote at all. The Initial Stockholders have agreed (a) to waive their redemption rights with respect to their Founder Shares, Private Shares and Public Shares held by them in connection with the completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Certificate of Incorporation that would affect a public stockholders’ ability to convert or sell their shares to the Company in connection with a Business Combination or affect the substance or timing of the Company’s obligation to redeem 100% of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment. The Company will have until July 10, 2023 to complete a Business Combination (the “Combination Period”). If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purposes of winding up, (ii) as promptly as reasonably possible but not more than ten The Initial Stockholders have agreed to waive their liquidation rights with respect to the Founder Shares and Private Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Initial Stockholders acquire Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. 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. In order to protect the amounts held in the Trust Account, certain of the Initial Stockholders have agreed to 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 amount of funds in the Trust Account to below (i) $10.15 per Public Share or (ii) such lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a valid and enforceable agreement with the Company waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Initial Stockholders 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 Initial Stockholders will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (except the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. On January 9, 2023, the Company received a letter from The Nasdaq Stock Market LLC (“Nasdaq”), which stated that the Company no longer complied with Nasdaq’s continued listing rules due to the Company not having held an annual meeting of shareholders within 12 months of the Company’s fiscal year end, as required pursuant to Nasdaq Listing Rule 5620(a). In accordance with Nasdaq Listing Rule 5810(c)(2)(G), the Company had 45 calendar days to submit a plan to regain compliance and, if Nasdaq accepted the plan, Nasdaq would grant the Company an exception of up to 180 calendar days from the fiscal year end, or until June 29, 2023, to regain compliance. The Company held its Annual Meeting of Stockholders on February 13, 2023. On February 10, 2023, March 10, 2023, April 10, 2023, and May 10, 2023 Tigo Energy paid certain Initial Stockholders an aggregate amount of $326,362 (or $0.05 per share), according to the terms of the Non-Redemption Agreements in connection with the one-month Trust extensions from February 10, 2023 to March 10, 2023, from March 10, 2023 to April 10, 2023, from April 10, 2023 to May 10, 2023, and from May 10, 2023 to June 10, 2023. Merger Agreement On December 5, 2022, the Company, entered into an Agreement and Plan of Merger (as it may be amended, supplemented or otherwise modified from time to time, the “Merger Agreement”), by and among the Company, Roth IV Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of the Company (“Merger Sub”), and Tigo Energy, Inc., a Delaware corporation (the “Tigo Energy”). The transactions set forth in the Merger Agreement, including the Merger (defined below), will constitute a “Business Combination” as contemplated by the Company’s Amended and Restated Certificate of Incorporation. Subject to the terms and conditions set forth in the Merger Agreement, Merger Sub will merge with and into Tigo Energy, with Tigo Energy surviving as a wholly-owned subsidiary of the Company (the “Merger”). Upon the closing and the other transactions contemplated by the Merger Agreement, the Company will change its name to “Tigo Energy, Inc.” Consideration Subject to the terms and conditions set forth in the Merger Agreement, in consideration of the Merger, the base purchase price of $600,000,000 will be payable through converting each outstanding share of Tigo Energy’s common stock (after giving effect to the consummation of Tigo Energy’s warrant exercise and Tigo Energy’s preferred conversion) into the right to receive 60,000,000 shares of the Company’s Common Stock at a deemed price of ten dollars ($10.00) per share, equal to (a) the exchange ratio, multiplied by (b) the number of shares of Tigo Energy’s common stock held by such holder as of immediately prior to the effective time of the Merger, with fractional shares rounded down to the nearest whole share. In addition, at the closing, each outstanding Tigo Energy’s option will be assumed and converted into an option with respect to a number of shares of the Company’s Common Stock in the manner set forth in the Merger Agreement, and each outstanding Tigo Energy’s warrant (after giving effect to Tigo Energy’s warrant exercise) to purchase Tigo Energy’s common stock will be assumed and converted into a warrant with respect to a number of shares of the Company’s Common Stock in the manner set forth in the Merger Agreement. The base purchase price is subject to a dollar-for-dollar upward or downward adjustment in the event Tigo Energy raises or obtains a commitment to raise capital prior to the closing, including capital raised through the conversion of debt securities (but specifically excluding capital raised through convertible notes or similar debt instruments convertible into or exercisable for capital stock or other equity securities of Tigo Energy to the extent such notes or similar debt instruments have not so converted). If Tigo Energy raises or obtains a commitment to raise capital based on a pre-money valuation at or exceeding $500,000,000, the base purchase price will increase by the aggregate amount of capital raised or committed to be raised by Tigo Energy through such capital raising transaction. Conversely, if the pre-money valuation is below $500,000,000, the base purchase price will decrease by an amount equal to the difference between $500,000,000 and the actual pre-money valuation. Trust Extension On December 20, 2022, the Company held a special meeting of stockholders, at which the Company’s stockholders approved an amendment (the “Extension Amendment”) to the Company’s amended and restated certificate of incorporation, to extend the date by which the Company has to consummate a business combination up to five (5) times, each such extension for an additional one (1) month period, from February 10, 2023 to July 10, 2023. In connection with the Extension Amendment, stockholders holding 9,121,751 shares of redeemable common stock exercised their right to redeem such shares for a pro rata portion of the funds in the Trust Account at a pro rata redemption price of approximately $10.24 per share, and a total of $93,419,442 was released from the Trust Account. Liquidity and Going Concern As of March 31, 2023, the Company had $123,759 in its operating bank account and adjusted working capital deficit of $886,992 which excludes franchise and income taxes payable as such amounts can be paid from the interest earned in the Trust Account. Until the consummation of a Business Combination, the Company will be using the funds not held in the Trust Account for performing due diligence on prospective target businesses, paying for travel expenditures, and structuring, negotiating, and consummating the Business Combination. The Company has a significant working capital deficiency and has incurred and expects to continue to incur significant costs in pursuit of its acquisition plans. The Company will need to raise additional capital through loans or additional investments from the Initial Stockholders and the Company’s officers and directors or their affiliates. The Initial Stockholders and the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. If the Company is unable to complete the Business Combination because it does not have sufficient funds available, the Company will be forced to cease operations and liquidate the Trust Account. In connection with the Company’s assessment of going concern considerations in accordance with the Financial Accounting Standards Board’s (“FASB’s”) Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” the Company has until July 10, 2023 to consummate a Business Combination. It is uncertain that the Company will be able to consummate a Business Combination by this time. If a Business Combination is not consummated by this date and an extension has not been effected by the Company and approved by the Company’s stockholders, there will be a mandatory liquidation and subsequent dissolution of the Company. Management has determined that the liquidity condition and the date for mandatory liquidation and subsequent dissolution raises substantial doubt about the Company’s ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after July 10, 2023. The Company intends to complete a Business Combination before the mandatory liquidation date. The Company is within 12 months of its mandatory liquidation date as of the time of filing this Quarterly Report on Form 10-Q. Risks and Uncertainties Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that COVID-19 could have a negative effect on the Company’s financial position, results of operations and/or its search for a target company for a Business Combination, the specific impact is not readily determinable as of the date of these condensed consolidated financial statements. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Inflation Reduction Act of 2022 On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The IR Act provides for, among other things, a new U.S. federal 1% excise tax on certain repurchases of stock by publicly traded U.S. domestic corporations and certain U.S. domestic subsidiaries of publicly traded foreign corporations occurring on or after January 1, 2023. The excise tax is imposed on the repurchasing corporation itself, not its shareholders from which shares are repurchased. The amount of the excise tax is generally 1% of the fair market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the excise tax. The U.S. Department of the Treasury (the “Treasury”) has been given authority to provide regulations and other guidance to carry out and prevent the abuse or avoidance of the excise tax. Any redemption or other repurchase that occurs after December 31, 2022, in connection with a Business Combination, extension vote or otherwise, may be subject to the excise tax. Whether and to what extent the Company would be subject to the excise tax in connection with a Business Combination, extension vote or otherwise would depend on a number of factors, including (i) the fair market value of the redemptions and repurchases in connection with the Business Combination, extension or otherwise, (ii) the structure of a Business Combination, (iii) the nature and amount of any “PIPE” or other equity issuances in connection with a Business Combination (or otherwise issued not in connection with a Business Combination but issued within the same taxable year of a Business Combination) and (iv) the content of regulations and other guidance from the Treasury. In addition, because the excise tax would be payable by the Company and not by the redeeming holder, the mechanics of any required payment of the excise tax have not been determined. The foregoing could cause a reduction in the cash available on hand to complete a Business Combination and in the Company’s ability to complete a Business Combination. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed 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 for the year ended December 31, 2022, as filed with the SEC on March 31, 2023. The interim results for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any future periods. 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. Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm 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)(l) 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 condensed consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. 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 condensed consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2023 and December 31, 2022. Cash and Marketable Securities Held in Trust Account At March 31, 2023 all of the assets held in the Trust account were held in money market funds which are invested primarily in U.S. Treasury Securities. At December 31, 2022, all of the assets held in the Trust Account were held in cash. The Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the balance sheets at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of these investments 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 the Trust Account are determined using available market information. Offering Costs 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. 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 amounted to $1,646,673, which were initially charged to temporary equity and then accreted to common stock subject to redemption upon the completion of the Initial Public Offering. Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”), Topic 480 “Distinguishing Liabilities from Equity.” Shares of 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 right that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. In connection with the stockholders vote at the Special Meeting of Stockholders held by the Company on December 20, 2022, 9,121,751 shares of common stock were tendered for redemption. Accordingly, at March 31, 2023 and December 31, 2022, 2,378,249 shares of common stock subject to possible redemption are presented at $10.30 and $10.23 redemption value, respectively, as temporary equity, outside of the stockholders’ deficit section of the Company’s balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption amount value. The change in the carrying value of redeemable common stock resulted in a charge against additional paid-in capital. At March 31, 2023 and December 31, 2022, the common stock subject to possible redemption reflected in the balance sheets was reconciled in the following table: Common stock subject to possible redemption, December 31, 2021 $ 116,725,000 Less: Redemption of 9,121,751 shares (93,419,442) Extension payment (135,440) Plus: Remeasurement of carrying value to redemption value 1,152,044 Common stock subject to possible redemption, December 31, 2022 $ 24,322,162 Less: Extension payment (163,181) Plus: Remeasurement of carrying value to redemption value 326,452 Common stock subject to possible redemption, March 31, 2023 $ 24,485,433 Warrant Classification The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The Company has analyzed the Public Warrants and Private Warrants and determined they are considered to be freestanding instruments and do not exhibit any of the characteristics in ASC 480 and therefore are not classified as liabilities under ASC 480. Income Taxes The Company accounts for income taxes under ASC 740, “Income Taxes.” ASC 740, Income Taxes, 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 March 31, 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 (18.06%) and 0.00% for the three months ended March 31, 2023 and 2022, respectively. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2023 due to the permanent difference on M&A Expenses and the increase in the valuation allowance on the deferred tax assets. and the effective tax rate differs from the statutory rate of 21% for the three months ended March 31, 2022, due to 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 March 31, 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 per Common Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” The Company has two classes of common stock, which are referred to as redeemable common stock and non-redeemable common stock. Income and losses are shared pro rata between the two classes of common stock. Net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the period. Remeasurement associated with the redeemable shares of common stock is excluded from net loss per common share as the redemption value approximates fair value. The calculation of diluted loss 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 since the exercise of the warrants is contingent upon the occurrence of future events. The warrants are exercisable to purchase 5,980,750 shares of common stock in the aggregate. As of March 31, 2023 and 2022, the Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into common stocks and then share in the earnings of the Company. As a result, diluted net loss per common share is the same as basic net loss per common share for the periods presented. The following tables reflect the calculation of basic and diluted net loss per common share (in dollars, except per share amounts): For the Three Months Ended March 31, 2023 2022 Redeemable Non-redeemable Redeemable Non-redeemable common stock common stock common stock common stock Basic and diluted net loss per common share Numerator: Allocation of net loss $ (171,076) $ (240,006) $ (94,275) $ (27,352) Denominator: Basic and diluted weighted average shares outstanding 2,378,249 3,336,500 11,500,000 3,336,500 Basic and diluted net loss per common share $ (0.07) $ (0.07) $ (0.01) $ (0.01) 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 Corporation coverage limit of $250,000. The Company has not experienced losses on these accounts. Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature. Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) which simplifies accounting for convertible instruments by removing major separation models required under GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for fiscal years beginning after December 15, 2023 including interim periods within those fiscal years, with early adoption permitted. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s condensed consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed consolidated financial statements. |
INITIAL PUBLIC OFFERING
INITIAL PUBLIC OFFERING | 3 Months Ended |
Mar. 31, 2023 | |
INITIAL PUBLIC OFFERING. | |
INITIAL PUBLIC OFFERING | NOTE 3. INITIAL PUBLIC OFFERING On August 10, 2021, pursuant to the Initial Public Offering, the Company sold 11,500,000 Units, which included a full exercise by the underwriters of their over-allotment option in the amount of 1,500,000 Units, at a price of $10.00 per Unit. Each Unit consists of one share of common stock and one |
PRIVATE PLACEMENT
PRIVATE PLACEMENT | 3 Months Ended |
Mar. 31, 2023 | |
PRIVATE PLACEMENT. | |
PRIVATE PLACEMENT | NOTE 4. PRIVATE PLACEMENT Simultaneously with the closing of the Initial Public Offering, certain of the Initial Stockholders purchased an aggregate of 461,500 Private Units at a price of $10.00 per Private Unit, for an aggregate purchase price of $4,615,000, in a private placement. Each Private Unit consists of one share of common stock (“Private Share”) and one |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2023 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares In February 2019, an Initial Stockholder purchased an aggregate of 100 shares of the Company’s common stock for an aggregate price of $25,000. On June 29, 2020, the Company effected a stock dividend of 43,125 shares of common stock for each share of common stock outstanding, resulting in an aggregate of 4,312,500 shares of common stock being outstanding. On July 1, 2021, certain of the Initial Stockholders sold an aggregate of 1,490,874 shares of common stock to the Company for an aggregate purchase price of $8,643, of which 1,437,500 shares were cancelled and the remaining 53,374 shares were purchased by certain of the Company’s officers from the Company for an aggregate purchase price of $464, resulting in an aggregate of 2,875,000 shares of common stock being outstanding (the “Founder Shares”). The Founder Shares included an aggregate of up to 375,000 shares subject to forfeiture by the Initial Stockholders to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Initial Stockholders would collectively own approximately 20% of the Company’s issued and outstanding shares after the Initial Public Offering (assuming the Initial Stockholders did not purchase any Public Shares in the Initial Public Offering and excluding the Private Shares). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are subject to forfeiture. The sale of the Founder Shares to certain of the Company’s officers, as described above, is within the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The fair value of the 53,374 shares sold to the Company’s officers was $323,446, or $6.06 per share. The Founder Shares were effectively sold subject to a performance condition (i.e., the occurrence of a Business Combination). Compensation expense related to the Founder Shares is recognized only when the performance condition is probable of occurrence. Stock-based compensation will be recognized at the date a Business Combination is considered probable in an amount equal to the number of Founder Shares times the grant date fair value per share (unless subsequently modified) less the amount initially received for the purchase of the Founder Shares. As of March 31, 2023, the Company determined that a Business Combination is not considered probable, and, therefore, no stock-based compensation expense has been recognized. The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until (1) with respect to 50% of the Founder Shares, the earlier of six months after the completion of a Business Combination and the date on which the closing price of the common stock equals or exceeds $12.50 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 after a Business Combination and (2) with respect to the remaining 50% of the Founder Shares, six months after the completion of a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Promissory Notes — Related Party On March 3, 2021, the Company issued an unsecured promissory note to an Initial Stockholder (the “Promissory Note”), pursuant to which the Company could borrow up to an aggregate principal amount of $200,000. The Promissory Note was non-interest bearing and payable on the earlier of the consummation of the Initial Public Offering or the date on which the Company determined not to proceed with the Initial Public Offering. The outstanding balance under the Promissory Note of $200,000 was repaid at the closing of the Initial Public Offering on August 10, 2021. Borrowings under Promissory Note are no longer available. On February 14, 2023, the Company issued an unsecured promissory note in the aggregate principal amount of $200,000 (the “Note”) to CR Financial Holdings, Inc. (the “Payee”). Pursuant to the Note, the Payee agreed to loan to the Company an aggregate amount of $200,000 that shall be payable on the earlier of (i) the date on which the Company consummates a business combination with target businesses, or (ii) the date the Company liquidates if a business combination is not consummated. The Note bears no interest rate. In the event that the Company does not consummate a business combination, the Note will be repaid only from amounts remaining outside of the Company’s trust account, if any. The proceeds of the Note will be used for the Company to pay various expenses of the Company and for general corporate purposes. As of March 31, 2023 and December 31, 2022, the Company’s outstanding balance for the promissory note is $200,000 and $0, respectively. Working Capital Loans In order to finance transaction costs in connection with a Business Combination, the Initial Stockholders and certain of the Company’s officers and directors (or their affiliates) may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would be repaid upon consummation of a Business Combination, without interest. No Working Capital Loans were outstanding as of March 31, 2023 and December 31, 2022. Underwriting Agreement and Business Combination Marketing Agreement On August 5, 2021, the Company entered into an underwriting agreement and a business combination marketing agreement with Roth Capital Partners, LLC (“Roth”) and Craig-Hallum Capital Group LLC (“Craig-Hallum”), the underwriters in the Initial Public Offering. The underwriters are related parties of the Company. On December 5, 2022, the Company entered a letter agreement to terminate the business combination marketing agreement. See Note 6 for a discussion of the business combination marketing agreement. Due from Certain Initial Stockholders On December 16, 2022, the Company paid $135,440 to the Non-redeeming Stockholders on behalf of certain Initial Stockholders in connection with the Non-Redemption Agreements (see Note 6). |
COMMITMENTS
COMMITMENTS | 3 Months Ended |
Mar. 31, 2023 | |
COMMITMENTS. | |
COMMITMENTS | NOTE 6. COMMITMENTS Registration Rights Pursuant to a registration rights agreement entered into on August 5, 2021, the holders of the Founder Shares, as well as the holders of the Private Units (and underlying securities), are entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that the Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of common stock are to be released from escrow. The holders of a majority of the Private Units (and 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. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Notwithstanding the foregoing, the holders may not exercise demand or piggyback rights after five (5) and seven (7) years, respectively, from the effective date of the Initial Public Offering and may not exercise demand rights on more than one occasion in respect of all registrable securities. Business Combination Marketing Agreement Pursuant to a business combination marketing agreement entered into on August 5, 2021, the Company engaged Roth and Craig-Hallum, the underwriters in the Initial Public Offering, as advisors in connection with its Business Combination to assist in the transaction structuring and negotiation of a definitive purchase agreement with respect to the Business Combination, hold meetings with the stockholders to discuss the Business Combination and the target’s attributes, introduce the Company to potential investors to purchase its securities in connection with the Business Combination, assist in obtaining stockholder approval for the Business Combination, and assist with financial analysis, presentations, press releases and filings related to the Business Combination. The Company agreed to pay Roth and Craig-Hallum a fee for such services upon the consummation of a Business Combination in an amount equal to, in the aggregate, 4.5% of the gross proceeds of the Initial Public Offering, or $5,175,000. Roth and Craig-Hallum were not entitled to such fee unless the Company consummated a Business Combination. Concurrently with the execution of the Merger Agreement on December 5, 2022, the Company entered into a letter agreement with Roth and Craig-Hallum to terminate the Business Combination Marketing Agreement (the “Letter Agreement”). Pursuant to the Letter Agreement, in exchange for services rendered in connection with the transactions contemplated in the Merger Agreement, Roth may be issued up to 300,000 Advisor Shares (shares of common stock, post-merger) equal to a fixed amount of 100,000 shares, regardless of the amount of equity raised in exchange for services rendered in connection with the transactions contemplated in the Merger Agreement, plus up to 200,000 shares based on the equity raised (“Variable Compensation Shares”). The number of Variable Compensation Shares will be equal to the product of (x) the quotient of equity raised divided by $50.0 million, multiplied by (y) 200,000. The Advisor Shares are issuable based on (a) the gross proceeds received from a capital raising transaction involving the equity securities of the Company and (b) the amount remaining in the Company’s trust account after giving effect to any redemptions (as further described in the Letter Agreement). On February 23, 2023, the Company entered into an amendment to the Letter Agreement. Pursuant to the amendment, the term equity raised was revised to mean the gross proceeds available to the post-Business Combination company immediately after the closing of the Business Combination consisting of (a) the gross proceeds received from a capital raising transaction involving the equity securities or equity-linked instruments of Tigo Energy; provided, however, that the $50.0 million of proceeds from the sale of convertible promissory notes by Tigo Energy to L1 Energy Capital Management S.a.r.l. shall be excluded from the calculation of equity raised; (b) the gross proceeds received from a capital raising transaction involving the equity securities of the Company; and (c) the amount remaining in the Company’s trust account after giving effect to any redemptions. The Advisor Shares in the Letter Agreement is in the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The fair value of the up to 300,000 Advisor Shares that Roth may receive for services rendered is $10.20 per share, the value of the common stock of the Company at December 31, 2022. The Advisor Shares were effectively granted subject to a performance condition (i.e., the occurrence of a Business Combination). Compensation expense related to the Advisor Shares is recognized only when the performance condition is probable of occurrence. Stock-based compensation will be recognized at the date a Business Combination is considered probable in an amount equal to the number of Advisor Shares times the grant date fair value per share (unless subsequently modified). As of March 31, 2023 and December 31, 2022, the Company determined that a Business Combination is not considered probable, and, therefore, no stock-based compensation expense has been recognized. Service Agreement Pursuant to a service agreement entered on July 5, 2022, the Company engaged Roth and Craig-Hallum (together the “financial advisors”) to provide services in connection with a proposed financing by the Company in connection with a business combination. In connection with this agreement the Company may be required to pay fees in connection with their services to the extent that the financing is executed. If during the term of the agreement the Company completes a financing of equity securities, convertible securities or debt of the Company, the Company has agreed to pay the financial advisors a fee in the amount of 4.0% of the gross proceeds raised. Each advisor would receive 50% of any placement agent fee, which will be paid upon the closing of the offering and business combination. The term of the agreement will run until the earlier of the date that the Company completes any Business Combination and otherwise liquidates the funds held in the Trust account. Merger Agreement On December 5, 2022, the Company, entered into the Merger Agreement with Merger Sub and Tigo Energy. The transactions set forth in the Merger Agreement, including the Merger, will constitute a “Business Combination” as contemplated by the Company’s Amended and Restated Certificate of Incorporation. Subject to the terms and conditions set forth in the Merger Agreement, Merger Sub will merge with and into Tigo Energy, with Tigo Energy surviving as a wholly owned subsidiary of the Company. Concurrently with the execution of the Merger Agreement, the Sponsors (as defined in the Sale and Purchase Agreement) entered into the Sale and Purchase Agreement with Tigo Energy, pursuant to which, immediately prior to the effective time of the Merger, the Sponsors will sell to Tigo Energy 1,645,000 shares of Common Stock and 424,000 Private Units in exchange for an amount equal to $2,300,000 pursuant to the Sale and Purchase Agreement. Non-Redemption Agreements On December 8 and 9, 2022, the Company entered into Non-Redemption Agreements with various stockholders (the “Non-redeeming Stockholders”) owning, in the aggregate, 1,631,811 shares of the Company’s common stock, pursuant to which these stockholders committed not to redeem their shares in the Company in connection with the Extension Amendment. In consideration of such agreements, CR Financial Holdings, Inc. and CHLM Sponsor, certain of our Initial Stockholders, agreed to pay the Non-redeeming Stockholders that entered into such agreements $0.083 per share for the period from the stockholder approval of the Extension Amendment on December 20, 2022 through February 10, 2023 and subsequently $0.05 per share for each one-month extension in connection with such agreements. No additional funds were deposited into the Trust Account. On December 16, 2022, the Company paid $135,440 (the “Extension Payment”) to the Non-Redeeming Stockholders on behalf of such Initial Stockholders. On February 10, 2023 and March 10, 2023, Tigo Energy paid certain Initial Stockholders an aggregate amount of $163,181 (or $0.05 per share), according to the terms of the Non-Redemption Agreements in connection with the one-month Trust extension from February 10, 2023 to March 10, 2023 and in connection with the one-month Trust extension from March 10, 2023 to April 10, 2023. The value of the Extension Payments were determined to be the equivalent of an offering cost in accordance with Staff Accounting Bulletin Topic 5A. Accordingly, the offering costs would be allocated to the separable financial instruments on a relative fair value basis, compared to total proceeds received. The Company recorded a reduction in temporary equity for the Extension Payments of $163,182 and $135,440, as of March 31, 2023 and December 31, 2022, respectively. The Company also recorded a contribution to Additional Paid-in Capital of $163,181 and $135,440, as of March 31, 2023 and December 31, 2022, respectively. A receivable in Due from certain Initial Stockholders was recorded for the amount due from such initial stockholders of $135,440 as of December 31, 2022, in connection with the Extension Amendment. The amount due from certain Initial Stockholders was paid in full to the Company by Tigo Energy on March 1, 2023. All payments made by Tigo Energy to the Non-redeeming Stockholders on behalf of certain Initial Stockholders will be reduced from the $2,300,000 payment pursuant to the Sale and Purchase Agreement at the closing of the Business Combination. |
STOCKHOLDERS' (DEFICIT) EQUITY
STOCKHOLDERS' (DEFICIT) EQUITY | 3 Months Ended |
Mar. 31, 2023 | |
STOCKHOLDERS' (DEFICIT) EQUITY | |
STOCKHOLDERS' (DEFICIT) EQUITY | NOTE 7. STOCKHOLDERS’ (DEFICIT) EQUITY Common Stock Warrants The Company will not issue fractional warrants. The Public Warrants will become exercisable 30 days after the completion of a Business Combination. No warrants will be exercisable for cash unless the Company has an effective and current registration statement covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to such shares of common stock. Notwithstanding the foregoing, if the registration statement of which the prospectus for the Company’s Initial Public Offering forms a part is not available and a new registration statement covering the shares of common stock issuable upon exercise of the Public Warrants is not effective within 120 days following the consummation of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. The warrants will expire five years from the closing of a Business Combination. The Company may redeem the Public Warrants: ● in whole and not in part; ● at a price of $0.01 per warrant; ● at any time after the warrants become exercisable; ● upon not less than 30 days ’ prior written notice of redemption to each warrant holder; ● if, and only if, the reported last sale price of the shares of common stock equals or exceeds $18.00 per share, for any 20 trading days within a 30-day trading period commencing after the warrants become exercisable and ending on the third business day prior to the notice of redemption to warrant holders; and ● if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30- day trading period referred to above and continuing each day thereafter until the date of redemption. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted for issuances of shares of common stock at a price below their respective exercise prices. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless. In addition, if (x) the Company issues additional shares of 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 share of common stock (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors), (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 the Company’s common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates 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 Market Value and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 180% of the Market Price. Except with respect to certain registration rights and transfer restrictions, the Private Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2023 | |
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. The following table presents information about the Company’s assets that are measured at fair value on a recurring basis at March 31, 2023 and December 31, 2022 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, March 31, Description Level 2022 2023 Assets: Cash and Marketable securities held in Trust Account 1 $ 24,678,170 $ 24,601,832 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 9. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed consolidated financial statements were issued. Based upon this review, other than as described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements. On April 10, 2023 and May 10, 2023, Tigo Energy paid certain Initial Stockholders an aggregate amount of $163,181 (or $0.05 per share), according to the terms of the Non-Redemption Agreements in connection with the one-month Trust extensions from April 10, 2023 to May 10, 2023 and from May 10, 2023 to June 10, 2023. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed 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 for the year ended December 31, 2022, as filed with the SEC on March 31, 2023. The interim results for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any future periods. |
Principles of Consolidation | 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. |
Emerging Growth Company | Emerging Growth Company The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm 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)(l) 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 condensed consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. |
Use of Estimates | Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the 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 condensed consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2023 and December 31, 2022. |
Cash and Marketable Securities Held in Trust Account | Cash and Marketable Securities Held in Trust Account At March 31, 2023 all of the assets held in the Trust account were held in money market funds which are invested primarily in U.S. Treasury Securities. At December 31, 2022, all of the assets held in the Trust Account were held in cash. The Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the balance sheets at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of these investments 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 the Trust Account are determined using available market information. |
Offering Costs | Offering Costs 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. 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 amounted to $1,646,673, which were initially charged to temporary equity and then accreted to common stock subject to redemption upon the completion of the Initial Public Offering. |
Common Stock Subject to Possible Redemption | Common Stock Subject to Possible Redemption The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”), Topic 480 “Distinguishing Liabilities from Equity.” Shares of 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 right that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. In connection with the stockholders vote at the Special Meeting of Stockholders held by the Company on December 20, 2022, 9,121,751 shares of common stock were tendered for redemption. Accordingly, at March 31, 2023 and December 31, 2022, 2,378,249 shares of common stock subject to possible redemption are presented at $10.30 and $10.23 redemption value, respectively, as temporary equity, outside of the stockholders’ deficit section of the Company’s balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption amount value. The change in the carrying value of redeemable common stock resulted in a charge against additional paid-in capital. At March 31, 2023 and December 31, 2022, the common stock subject to possible redemption reflected in the balance sheets was reconciled in the following table: Common stock subject to possible redemption, December 31, 2021 $ 116,725,000 Less: Redemption of 9,121,751 shares (93,419,442) Extension payment (135,440) Plus: Remeasurement of carrying value to redemption value 1,152,044 Common stock subject to possible redemption, December 31, 2022 $ 24,322,162 Less: Extension payment (163,181) Plus: Remeasurement of carrying value to redemption value 326,452 Common stock subject to possible redemption, March 31, 2023 $ 24,485,433 |
Warrant Classification | Warrant Classification The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The Company has analyzed the Public Warrants and Private Warrants and determined they are considered to be freestanding instruments and do not exhibit any of the characteristics in ASC 480 and therefore are not classified as liabilities under ASC 480. |
Income Taxes | Income Taxes The Company accounts for income taxes under ASC 740, “Income Taxes.” ASC 740, Income Taxes, 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 March 31, 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 (18.06%) and 0.00% for the three months ended March 31, 2023 and 2022, respectively. The effective tax rate differs from the statutory tax rate of 21% for the three months ended March 31, 2023 due to the permanent difference on M&A Expenses and the increase in the valuation allowance on the deferred tax assets. and the effective tax rate differs from the statutory rate of 21% for the three months ended March 31, 2022, due to 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 March 31, 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 per Common Share | Net Loss per Common Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” The Company has two classes of common stock, which are referred to as redeemable common stock and non-redeemable common stock. Income and losses are shared pro rata between the two classes of common stock. Net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the period. Remeasurement associated with the redeemable shares of common stock is excluded from net loss per common share as the redemption value approximates fair value. The calculation of diluted loss 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 since the exercise of the warrants is contingent upon the occurrence of future events. The warrants are exercisable to purchase 5,980,750 shares of common stock in the aggregate. As of March 31, 2023 and 2022, the Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into common stocks and then share in the earnings of the Company. As a result, diluted net loss per common share is the same as basic net loss per common share for the periods presented. The following tables reflect the calculation of basic and diluted net loss per common share (in dollars, except per share amounts): For the Three Months Ended March 31, 2023 2022 Redeemable Non-redeemable Redeemable Non-redeemable common stock common stock common stock common stock Basic and diluted net loss per common share Numerator: Allocation of net loss $ (171,076) $ (240,006) $ (94,275) $ (27,352) Denominator: Basic and diluted weighted average shares outstanding 2,378,249 3,336,500 11,500,000 3,336,500 Basic and diluted net loss per common share $ (0.07) $ (0.07) $ (0.01) $ (0.01) |
Concentration of Credit Risk | 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 Corporation coverage limit of $250,000. The Company has not experienced losses on these accounts. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature. |
Recent Accounting Standards | Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) which simplifies accounting for convertible instruments by removing major separation models required under GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for fiscal years beginning after December 15, 2023 including interim periods within those fiscal years, with early adoption permitted. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s condensed consolidated financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of common stock subject to possible redemption | Common stock subject to possible redemption, December 31, 2021 $ 116,725,000 Less: Redemption of 9,121,751 shares (93,419,442) Extension payment (135,440) Plus: Remeasurement of carrying value to redemption value 1,152,044 Common stock subject to possible redemption, December 31, 2022 $ 24,322,162 Less: Extension payment (163,181) Plus: Remeasurement of carrying value to redemption value 326,452 Common stock subject to possible redemption, March 31, 2023 $ 24,485,433 |
Schedule of calculation of basic and diluted net loss per common share | The following tables reflect the calculation of basic and diluted net loss per common share (in dollars, except per share amounts): For the Three Months Ended March 31, 2023 2022 Redeemable Non-redeemable Redeemable Non-redeemable common stock common stock common stock common stock Basic and diluted net loss per common share Numerator: Allocation of net loss $ (171,076) $ (240,006) $ (94,275) $ (27,352) Denominator: Basic and diluted weighted average shares outstanding 2,378,249 3,336,500 11,500,000 3,336,500 Basic and diluted net loss per common share $ (0.07) $ (0.07) $ (0.01) $ (0.01) |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
FAIR VALUE MEASUREMENTS | |
Schedule of company's assets that are measured at fair value on a recurring basis | December 31, March 31, Description Level 2022 2023 Assets: Cash and Marketable securities held in Trust Account 1 $ 24,678,170 $ 24,601,832 |
DESCRIPTION OF ORGANIZATION, _2
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY (Details) | 3 Months Ended | 12 Months Ended | ||||||||
May 10, 2023 USD ($) $ / shares | Apr. 10, 2023 USD ($) $ / shares | Mar. 10, 2023 USD ($) $ / shares | Feb. 10, 2023 USD ($) $ / shares | Dec. 20, 2022 shares | Aug. 10, 2021 USD ($) $ / shares shares | Dec. 20, 2020 item | Feb. 13, 2019 item | Mar. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) shares | |
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | ||||||||||
Condition for future business combination number of businesses minimum | item | 1 | |||||||||
Sale of private placement warrants (in shares) | shares | 5,980,750 | |||||||||
Transaction costs | $ 1,646,673 | $ 1,646,673 | ||||||||
Underwriting fees | 1,150,000 | |||||||||
Other offering costs | $ 496,673 | |||||||||
Condition for future business combination use of proceeds percentage | 80% | |||||||||
Condition for future business combination threshold percentage ownership | 50% | |||||||||
Condition for future business combination threshold net tangible assets | $ 5,000,001 | |||||||||
Obligation to redeem public shares if entity does not complete a business combination (as a percent) | 100% | |||||||||
Redemption period upon closure | 10 days | |||||||||
Redemption limit percentage without prior consent | 100 | |||||||||
Number of shares redeemed | shares | 9,121,751 | 9,121,751 | ||||||||
Operating bank account | 123,759 | $ 88,107 | ||||||||
Working capital | $ 886,992 | |||||||||
Merger agreement | ||||||||||
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | ||||||||||
Purchase price (in dollars per share) | $ / shares | $ 10 | |||||||||
Base purchase price payable | $ 600,000,000 | |||||||||
Number of shares issued | shares | 60,000,000 | |||||||||
Share issue price | $ / shares | $ 10 | |||||||||
Condition on amount of base purchase price | $ 500,000,000 | |||||||||
Extension amendment | ||||||||||
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | ||||||||||
Number of times up to which the business combination is consummated | item | 5 | |||||||||
Period of extension amendment allowed | 1 month | |||||||||
Number of shares redeemed | shares | 9,121,751 | |||||||||
Redemption price per share | $ / shares | $ 10.24 | |||||||||
Amount released from Trust for redemption | $ 93,419,442 | |||||||||
Tigo Energy, Inc. | ||||||||||
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | ||||||||||
Payment made to non redeeming stockholders | $ 326,362 | $ 326,362 | $ 326,362 | $ 326,362 | ||||||
Share issue price by initial stockholders, on one month extension | $ / shares | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | ||||||
Initial Public Offering | ||||||||||
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | ||||||||||
Sale of unit (in shares) | shares | 11,500,000 | |||||||||
Purchase price (in dollars per share) | $ / shares | $ 10.15 | |||||||||
Proceeds from issuance initial public offering | $ 115,000,000 | |||||||||
Payments for investment of cash in trust account | $ 116,725,000 | |||||||||
Share issue price | $ / shares | $ 10.15 | |||||||||
Private placement | Private placement warrants | ||||||||||
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | ||||||||||
Sale of unit (in shares) | shares | 461,500 | |||||||||
Sale of private placement warrants (in shares) | shares | 461,500 | |||||||||
Price of warrant (in dollars per share) | $ / shares | $ 10 | |||||||||
Proceeds from sale of Private Units | $ 4,615,000 | |||||||||
Over-allotment option | ||||||||||
DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND LIQUIDITY | ||||||||||
Sale of unit (in shares) | shares | 1,500,000 | |||||||||
Purchase price (in dollars per share) | $ / shares | $ 10 | |||||||||
Share issue price | $ / shares | $ 10 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Dec. 20, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Aug. 10, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Cash equivalents | $ 0 | $ 0 | |||
Transaction costs | $ 1,646,673 | $ 1,646,673 | |||
Number of shares redeemed | 9,121,751 | 9,121,751 | |||
Effective tax rate | 18.06% | 0% | |||
Statutory federal income tax rate (in percent) | 21% | 21% | |||
Unrecognized tax benefits | $ 0 | $ 0 | |||
Unrecognized tax benefits accrued for interest and penalties | 0 | $ 0 | |||
Federal depositary insurance coverage | $ 250,000 | ||||
Common stock subject to possible redemption | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Common stock subject to possible redemption, outstanding (in shares) | 2,378,249 | 2,378,249 | |||
Common stock subject to possible redemption value (in dollar per share) | $ 10.30 | $ 10.23 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Common stock subject to possible redemption (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 20, 2022 | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Remeasurement of carrying value to redemption value | $ 326,452 | |||
Number of shares redeemed | 9,121,751 | 9,121,751 | ||
Common stock subject to possible redemption | ||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Common stock subject to possible redemption | 24,485,433 | $ 24,322,162 | $ 116,725,000 | |
Redemption of 9,121,751 shares | (93,419,442) | |||
Extension payment | (163,181) | (135,440) | ||
Remeasurement of carrying value to redemption value | $ 326,452 | $ 1,152,044 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net loss per common share (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Common stock subject to possible redemption | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Allocation of net loss | $ (171,076) | $ (94,275) |
Weighted average shares outstanding, basic (in shares) | 2,378,249 | 11,500,000 |
Weighted average shares outstanding, diluted (in shares) | 2,378,249 | 11,500,000 |
Basic net loss per common share (in dollars per share) | $ (0.07) | $ (0.01) |
Diluted net loss per common share (in dollars per share) | $ (0.07) | $ (0.01) |
Common stock subject to possible non-redemption | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Allocation of net loss | $ (240,006) | $ (27,352) |
Weighted average shares outstanding, basic (in shares) | 3,336,500 | 3,336,500 |
Weighted average shares outstanding, diluted (in shares) | 3,336,500 | 3,336,500 |
Basic net loss per common share (in dollars per share) | $ (0.07) | $ (0.01) |
Diluted net loss per common share (in dollars per share) | $ (0.07) | $ (0.01) |
INITIAL PUBLIC OFFERING (Detail
INITIAL PUBLIC OFFERING (Details) | Aug. 10, 2021 $ / shares shares |
Initial Public Offering | |
INITIAL PUBLIC OFFERING | |
Sale of unit (in shares) | 11,500,000 |
Purchase price (in dollars per share) | $ / shares | $ 10.15 |
Initial Public Offering | Public Warrant | |
INITIAL PUBLIC OFFERING | |
Number of shares in a unit | 1 |
Number of warrants in a unit | 0.5 |
Number of shares issuable per warrant | 1 |
Exercise price of warrants | $ / shares | $ 11.50 |
Over-allotment option | |
INITIAL PUBLIC OFFERING | |
Sale of unit (in shares) | 1,500,000 |
Purchase price (in dollars per share) | $ / shares | $ 10 |
PRIVATE PLACEMENT (Details)
PRIVATE PLACEMENT (Details) - Private placement | Aug. 10, 2021 USD ($) $ / shares shares |
PRIVATE PLACEMENT | |
Number of shares per unit | $ 1 |
Number of warrants per unit | $ 0.50 |
Private placement warrants | |
PRIVATE PLACEMENT | |
Sale of 461,500 Private Units (in shares) | shares | 461,500 |
Price of warrants | $ 10 |
Aggregate purchase price | $ | $ 4,615,000 |
Number of shares per warrant | shares | 1 |
Exercise price of warrant (in dollars per share) | $ 11.50 |
RELATED PARTY TRANSACTIONS - Fo
RELATED PARTY TRANSACTIONS - Founder Shares (Details) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Dec. 20, 2022 shares | Jul. 01, 2021 USD ($) $ / shares shares | Jun. 29, 2020 shares | Feb. 28, 2019 USD ($) shares | Mar. 31, 2023 D $ / shares shares | Dec. 31, 2022 shares | |
RELATED PARTY TRANSACTIONS | ||||||
Number of shares cancelled | 9,121,751 | 9,121,751 | ||||
Percentage of transfer of founder shares with certain exceptions | 50% | |||||
Founder Shares | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Number of shares issued | 100 | |||||
Aggregate purchase price | $ | $ 8,643 | $ 25,000 | ||||
Share dividend | 43,125 | |||||
Aggregate number of shares owned | 4,312,500 | |||||
Shares subject to forfeiture | 1,490,874 | |||||
Number of shares cancelled | 1,437,500 | |||||
Common stock, shares outstanding | 2,875,000 | |||||
Percentage of issued and outstanding shares after the Initial Public Offering collectively held by initial stockholders | 20% | |||||
Stock price trigger to transfer, assign or sell any shares or warrants of the company, after the completion of the initial business combination (in dollars per share) | $ / shares | $ 12.50 | |||||
Threshold trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | D | 20 | |||||
Threshold consecutive trading days for transfer, assign or sale of shares or warrants, after the completion of the initial business combination | D | 30 | |||||
Percentage of transfer of remaining founder shares with certain exceptions | 50% | |||||
Founder Shares | Officer | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Number of shares issued | 53,374 | |||||
Aggregate purchase price | $ | $ 464 | |||||
Fair value upon the grant date | $ | $ 323,446 | |||||
Fair value upon the grant date (in dollars per share) | $ / shares | $ 6.06 | |||||
Founder Shares | Underwriter overallotment option was not exercised in full | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Shares subject to forfeiture | 375,000 | |||||
Founder Shares | Underwriter overallotment option exercised in full | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Shares subject to forfeiture | 0 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | Aug. 10, 2021 | Mar. 31, 2023 | Feb. 14, 2023 | Dec. 31, 2022 | Dec. 16, 2022 | Mar. 03, 2021 |
RELATED PARTY TRANSACTIONS | ||||||
Principal amount of loan | $ 200,000 | |||||
Due from Initial stockholders | $ 135,440 | |||||
Unsecured promissory note | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Principal amount of loan | $ 200,000 | |||||
Promissory Note with Related Party | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Maximum borrowing capacity of related party promissory note | $ 200,000 | |||||
Outstanding balance of related party note | $ 0 | |||||
Promissory Note with Related Party | Initial Public Offering | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Repayment of promissory note - related party | $ 200,000 | |||||
Related Party Loans | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Outstanding balance of related party note | $ 200,000 | |||||
Related Party Loans | Working capital loans warrant | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Outstanding of working capital loans | $ 0 | $ 0 |
COMMITMENTS (Details)
COMMITMENTS (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||||
May 10, 2023 | Apr. 10, 2023 | Mar. 10, 2023 | Feb. 23, 2023 | Feb. 10, 2023 | Dec. 09, 2022 | Dec. 08, 2022 | Dec. 05, 2022 | Feb. 22, 2022 | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 16, 2022 | Jul. 05, 2022 | |
COMMITMENTS. | |||||||||||||
Minimum period of piggy-back registration rights | 5 years | ||||||||||||
Maximum period of piggy-back registration rights | 7 years | ||||||||||||
Aggregate gross proceeds (as percentage) | 4.50% | ||||||||||||
Amount of advisory fee payable | $ 5,175,000 | ||||||||||||
Number of shares issued for services rendered | 300,000 | ||||||||||||
Placement agent fee (as percentage) | 50% | ||||||||||||
Tigo Energy, Inc. | |||||||||||||
COMMITMENTS. | |||||||||||||
Proceeds from Sale and Purchase Agreement | $ 2,300,000 | ||||||||||||
Share issue price by initial stockholders, on one month extension | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | |||||||||
Payment made to non redeeming stockholders | $ 326,362 | $ 326,362 | $ 326,362 | $ 326,362 | |||||||||
Tigo Energy, Inc. | Private Units | |||||||||||||
COMMITMENTS. | |||||||||||||
Number of shares sold for Sale and Purchase Agreement | 424,000 | ||||||||||||
Tigo Energy, Inc. | L1 Energy Capital Management | |||||||||||||
COMMITMENTS. | |||||||||||||
Proceeds from the sale of convertible promissory notes | $ 50 | ||||||||||||
Advisor Shares | |||||||||||||
COMMITMENTS. | |||||||||||||
Number of shares issued for services rendered | 300,000 | ||||||||||||
Share price for services rendered | $ 10.20 | ||||||||||||
Stock-based compensation expense | 0 | $ 0 | |||||||||||
Fixed Compensation Shares | |||||||||||||
COMMITMENTS. | |||||||||||||
Number of shares issued for services rendered | 100,000 | ||||||||||||
Variable Compensation Shares | |||||||||||||
COMMITMENTS. | |||||||||||||
Number of shares issued for services rendered | 200,000 | ||||||||||||
Quotient of equity raised divided | $ 50,000,000 | ||||||||||||
Common Stock | Tigo Energy, Inc. | |||||||||||||
COMMITMENTS. | |||||||||||||
Number of shares sold for Sale and Purchase Agreement | 1,645,000 | ||||||||||||
Non-Redemption Agreements | |||||||||||||
COMMITMENTS. | |||||||||||||
Number of shares owned by stockholders | 1,631,811 | 1,631,811 | |||||||||||
Share issue price by initial stockholders | $ 0.083 | $ 0.083 | |||||||||||
Share issue price by initial stockholders, on one month extension | $ 0.05 | $ 0.05 | |||||||||||
Payment made to non redeeming stockholders | 163,182 | 135,440 | $ 135,440 | ||||||||||
Non-redeeming stockholder agreement Initial Payment | 163,181 | $ 135,440 | |||||||||||
Non-Redemption Agreements | Tigo Energy, Inc. | |||||||||||||
COMMITMENTS. | |||||||||||||
Proceeds from Sale and Purchase Agreement | $ 2,300,000 | ||||||||||||
Share issue price by initial stockholders, on one month extension | $ 0.05 | $ 0.05 | |||||||||||
Payment made to non redeeming stockholders | $ 163,181 | $ 163,181 | |||||||||||
Financial advisor | |||||||||||||
COMMITMENTS. | |||||||||||||
Placement agent fee (as percentage) | 4% |
STOCKHOLDERS' (DEFICIT) EQUITY
STOCKHOLDERS' (DEFICIT) EQUITY - Common Stock Shares (Details) - $ / shares | 3 Months Ended | 12 Months Ended | |
Dec. 20, 2022 | Mar. 31, 2023 | Dec. 31, 2022 | |
STOCKHOLDERS' (DEFICIT) EQUITY | |||
Number of shares redeemed | 9,121,751 | 9,121,751 | |
Extension amendment | |||
STOCKHOLDERS' (DEFICIT) EQUITY | |||
Number of shares redeemed | 9,121,751 | ||
Redemption price per share | $ 10.24 | ||
Common stock | |||
STOCKHOLDERS' (DEFICIT) EQUITY | |||
Common shares, shares authorized (in shares) | 50,000,000 | 50,000,000 | |
Common shares, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |
Common stock subject to possible redemption | |||
STOCKHOLDERS' (DEFICIT) EQUITY | |||
Common stock subject to possible redemption, outstanding (in shares) | 2,378,249 | 2,378,249 | |
Common stock subject to possible redemption | Extension amendment | |||
STOCKHOLDERS' (DEFICIT) EQUITY | |||
Number of shares redeemed | 9,121,751 | ||
Redemption price per share | $ 10.24 | ||
Non-redeemable common stock | |||
STOCKHOLDERS' (DEFICIT) EQUITY | |||
Common shares, shares issued (in shares) | 3,336,500 | 3,336,500 | |
Common stock, shares outstanding | 3,336,500 | 3,336,500 |
STOCKHOLDERS' (DEFICIT) EQUIT_2
STOCKHOLDERS' (DEFICIT) EQUITY - Warrants (Details) | 3 Months Ended | |
Mar. 31, 2023 D $ / shares shares | Dec. 31, 2022 shares | |
Private placement warrants | ||
STOCKHOLDERS' (DEFICIT) EQUITY | ||
Warrants outstanding | shares | 230,750 | 230,750 |
Public Warrants | ||
STOCKHOLDERS' (DEFICIT) EQUITY | ||
Warrants outstanding | shares | 5,750,000 | 5,750,000 |
Warrants exercisable term from the completion of business combination | 30 days | |
Public warrants expiration term | 5 years | |
Share price trigger used to measure dilution of warrant | $ 9.20 | |
Number of days of which warrants will not be effective from the date of business combination | 120 days | |
Percentage of gross new proceeds to total equity proceeds used to measure dilution of warrant | 60% | |
Trading period after business combination used to measure dilution of warrant | D | 20 | |
Warrant exercise price adjustment multiple | 115% | |
Warrant redemption price adjustment multiple | 180% | |
Public Warrants | Redemption of warrants when the price per common share equals or exceeds $18.00 | ||
STOCKHOLDERS' (DEFICIT) EQUITY | ||
Redemption price per public warrant (in dollars per share) | $ 0.01 | |
Redemption period | 30 days | |
Warrant redemption condition minimum share price | $ 18 | |
Threshold trading days for redemption of public warrants | 20 days | |
Minimum threshold written notice period for redemption of public warrants | 30 days | |
Threshold consecutive trading days for redemption of public warrants | D | 30 |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Company's assets that are measured at fair value on a recurring basis (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Assets: | ||
Cash and Marketable securities held in Trust Account | $ 24,601,832 | $ 24,678,170 |
Level 1 | Recurring | ||
Assets: | ||
Cash and Marketable securities held in Trust Account | $ 24,601,832 | $ 24,678,170 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | May 10, 2023 | Apr. 10, 2023 | Mar. 10, 2023 | Feb. 10, 2023 | Dec. 09, 2022 | Dec. 08, 2022 | Mar. 31, 2023 | Dec. 31, 2022 | Dec. 16, 2022 |
Tigo Energy, Inc. | |||||||||
SUBSEQUENT EVENTS | |||||||||
Payment made to non redeeming stockholders | $ 326,362 | $ 326,362 | $ 326,362 | $ 326,362 | |||||
Share issue price by initial stockholders, on one month extension | $ 0.05 | $ 0.05 | $ 0.05 | $ 0.05 | |||||
Non-Redemption Agreements | |||||||||
SUBSEQUENT EVENTS | |||||||||
Payment made to non redeeming stockholders | $ 163,182 | $ 135,440 | $ 135,440 | ||||||
Share issue price by initial stockholders, on one month extension | $ 0.05 | $ 0.05 | |||||||
Non-Redemption Agreements | Tigo Energy, Inc. | |||||||||
SUBSEQUENT EVENTS | |||||||||
Payment made to non redeeming stockholders | $ 163,181 | $ 163,181 | |||||||
Share issue price by initial stockholders, on one month extension | $ 0.05 | $ 0.05 | |||||||
subsequent events | Non-Redemption Agreements | Tigo Energy, Inc. | |||||||||
SUBSEQUENT EVENTS | |||||||||
Payment made to non redeeming stockholders | $ 163,181 | $ 163,181 | |||||||
Share issue price by initial stockholders, on one month extension | $ 0.05 | $ 0.05 |