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Western Acquisition Ventures Corp.(WAVSU) - 2024 Q3 - Quarterly Report
WAVSUWestern Acquisition Ventures Corp.(WAVSU)2024-12-09 13:01

Financial Performance - For the three months ended September 30, 2024, the company reported a net loss of 375,004,whichincludedprofessionalfees,generalandadministrativeexpenses,andfranchisetaxes[177].−FortheninemonthsendedSeptember30,2024,thecompanyhadanetlossof375,004, which included professional fees, general and administrative expenses, and franchise taxes [177]. - For the nine months ended September 30, 2024, the company had a net loss of 670,325, consisting of 1,208,217inprofessionalfeesandotherexpenses,offsetbya1,208,217 in professional fees and other expenses, offset by a 665,116 change in fair value of the forward purchase agreement [179]. - For the nine months ended September 30, 2023, the company reported a net loss of 757,781,whichincluded757,781, which included 876,968 in professional fees and other expenses [180]. Liquidity and Capital Structure - As of September 30, 2024, the company had a working capital deficit of 3,664,323,indicatingliquiditychallenges[181].−Thecompanyincurredsignificantcostsinpursuitofacquisitionplansandmayneedadditionalfinancingtocompletethebusinesscombination[185].−AsofSeptember30,2024,theCompanyhasborrowed3,664,323, indicating liquidity challenges [181]. - The company incurred significant costs in pursuit of acquisition plans and may need additional financing to complete the business combination [185]. - As of September 30, 2024, the Company has borrowed 554,269 and accrued approximately 21,906ininterest[200].AcquisitionandMergerActivities−ThecompanyhasidentifiedanacquisitiontargetandexecutedamergeragreementwithCycurion,Inc.,withplanstoclosethebusinesscombinationbyDecember31,2024[169][170].−ThemergeragreementmaybeterminatedifnotconsummatedbyJanuary11,2025,raisingconcernsaboutthecompany′sabilitytocontinueasagoingconcern[175][186].−TheCompanyenteredintoapromissorynotewithCycurionfor21,906 in interest [200]. Acquisition and Merger Activities - The company has identified an acquisition target and executed a merger agreement with Cycurion, Inc., with plans to close the business combination by December 31, 2024 [169][170]. - The merger agreement may be terminated if not consummated by January 11, 2025, raising concerns about the company's ability to continue as a going concern [175][186]. - The Company entered into a promissory note with Cycurion for 200,000 at an interest rate of 5% per annum, with a maturity date of January 11, 2024 [200]. - The Company agreed to pay approximately 1.25millionofitsobligationsinsharesoftheCombinedCompany′scommonstock,totaling250,000sharesatapriceof1.25 million of its obligations in shares of the Combined Company's common stock, totaling 250,000 shares at a price of 5.00 per share [199]. - The Forward Purchase Agreement was terminated on January 22, 2024, which previously allowed Alpha to sell up to 300,000 shares to the Company [202]. - The Company amended the Promissory Note multiple times, increasing the principal amount to 554,269andextendingthematuritydatetoJanuary11,2025[200].AdvisoryandSupportAgreements−ThecompanyplanstoenterintoanadvisoryagreementwithA.G.P.,whichincludesatransactionfeeof554,269 and extending the maturity date to January 11, 2025 [200]. Advisory and Support Agreements - The company plans to enter into an advisory agreement with A.G.P., which includes a transaction fee of 2,500,000 payable in preferred shares convertible into common stock [195]. - The Company has a Support Agreement in place with its Sponsor and certain stockholders to vote in favor of the merger and related transactions [171][173]. Auditor and Compliance - The Company dismissed its previous independent auditor, Marcum LLP, and engaged WWC, P.C. as its new independent auditor on July 10, 2024 [209]. - The Company adopted ASU 2016-13 on January 1, 2023, which did not have a material impact on its financial statements [206]. - The Company has no material changes to the quantitative and qualitative disclosures about market risk since its 2023 Annual Report [215]. Employment Agreements - On December 27, 2023, the Company entered into an employment agreement with James P. McCormick for total annual compensation of 125,000,including125,000, including 40,000 in cash and $85,000 in stock payment [204]. Non-Operating Income - The company generated non-operating income in the form of interest income from the IPO proceeds placed in the Trust Account, but has not engaged in any operations or generated operating revenues to date [176]. Revised Arrangements - The Company has entered into revised arrangements with service providers, agreeing to pay obligations in shares of the Combined Company's common stock [199].