Financial Performance - Net loss for the three months ended June 30, 2024, was $222,793 compared to a net income of $855,377 for the same period in 2023[10]. - For the period ending June 30, 2024, the company reported a net loss of $662,778 compared to a net income of $3,205,754 for the same period in 2023[14]. - Basic and diluted net loss per share for redeemable Class A common stock was $(0.02) for the three months ended June 30, 2024, compared to $0.03 in 2023[10]. - The Company reported a basic and diluted net loss per common stock of $0.05 for the six months ended June 30, 2024, compared to a net income of $0.10 for the same period in 2023[61]. - The allocation of net loss income for Class A common stock was $(83,999) for the six months ended June 30, 2024, compared to $2,067,472 for the same period in 2023[61]. Assets and Liabilities - Total current assets decreased from $403,456 to $290,466, a decline of approximately 28%[7]. - Total liabilities increased from $22,027,309 to $26,969,809, an increase of approximately 22%[8]. - Accumulated deficit increased from $21,033,991 to $26,008,636, indicating a worsening financial position[8]. - Total stockholders' deficit increased from $21,632,811 to $26,607,456, marking a decline of approximately 23%[8]. - As of June 30, 2024, the Company had $290,466 in its operating account and a working capital deficit of approximately $4.6 million[38]. Cash Flow - Cash held in Trust Account decreased from $21,099,267 to $9,297,875, representing a reduction of about 56%[7]. - Net cash used in operating activities was $537,990, a decrease from $1,038,568 in the previous year[14]. - The company generated $12,286,736 in net cash from investing activities, down from $271,074,927 in the prior year[14]. - The company reported a net cash used in financing activities of $11,861,736, compared to $269,597,445 in the previous year[14]. - As of June 30, 2024, the company had cash of $290,466, a decrease from $848,639 at the end of the previous year[14]. Business Combination and Operations - The company entered into a non-binding letter of intent for a potential business combination with Airspace Experience Technologies, Inc. on October 16, 2023, which was later terminated on December 1, 2023[30]. - The Company must complete a business combination with a target having an aggregate fair market value of at least 80% of the assets held in the Trust Account[21]. - The Company intends to complete a Business Combination before the mandatory liquidation date of November 19, 2024[41]. - The Company entered into a Business Combination Agreement on March 18, 2024, with CID HoldCo, Inc. and SEE ID, Inc., aiming for a merger[132]. - There are no assurances that the Business Combination will close, pending satisfaction of customary closing conditions[95]. Stockholder Actions and Amendments - Following a special meeting on April 20, 2023, stockholders redeemed 25,845,428 shares for approximately $10.43 per share, totaling $269,597,445[29]. - The Company extended the deadline for completing a business combination from November 19, 2023, to May 19, 2024, with stockholders redeeming 2,170,004 shares for a total of $22,904,010, leaving $20,946,765 in the Trust Account after redemptions[31]. - On December 28, 2023, stockholders approved an amendment allowing Class B common stock to be converted into Class A common stock on a one-to-one basis[32]. - The company’s stockholders approved an amendment allowing Class B common stock to convert into Class A common stock on a one-to-one basis[123]. Tax Liabilities and Financial Obligations - The Company recorded a liability of $3,046,381 for the excise tax related to stock redemptions as of June 30, 2024[43]. - The Company continues to incur tax liabilities and plans to cover them from its operating account and potential additional financing from the Sponsor[40]. - The company withdrew $2,636,344 from the Trust Account for tax liabilities since its IPO, with $2,224,486 remitted to tax authorities, leaving an excess of $411,858[144]. - As of June 30, 2024, the company had accrued but unpaid income tax liability of $132,576 and unpaid Delaware franchise tax liability of $48,800[144]. Securities and Market Activity - The Company was assigned trading symbols for its common stock, units, and warrants, beginning to trade in the over-the-counter market on June 26, 2024[35]. - The company’s securities were delisted from the NYSE effective December 29, 2023, and are expected to be quoted on the Pink Sheets[124]. - The market price of Class A common stock was $10.85 as of June 30, 2024, with a volatility of 30.8%[111]. - The Company has 15,675,000 warrants outstanding, each entitling the holder to purchase one Class A common share at a price of $11.50[104]. Internal Controls and Compliance - The company has identified material weaknesses in internal controls over financial reporting as of December 31, 2023, affecting the effectiveness of its disclosure controls[149]. - The Chief Executive Officer, Phyllis W. Newhouse, signed the report on August 28, 2024, confirming compliance with the Exchange Act[160].
ShoulderUp Technology Acquisition (SUAC) - 2024 Q2 - Quarterly Report