Financial Performance - For the six months ended June 30, 2023, the company reported a net loss of $2,164,561, which included a loss on change in fair value of warrant liabilities of $1,184,750 [176]. - The Company had a net loss of $1,510,300 for the three months ended June 30, 2023, primarily due to a loss on change in fair value of warrant liabilities of $1,354,000 [193]. - For the six months ended June 30, 2022, the Company reported a net income of $3,378,404, primarily due to a gain on the change in fair value of warrant liabilities amounting to $4,346,250 [225]. - The Company's effective tax rate for the three and six months ended June 30, 2023 was -0.32%, differing from the statutory rate of 21% due to changes in fair value of warrant liabilities [222]. Cash and Liquidity - Cash used in operating activities for the same period was $1,053,129, while cash provided by investing activities was $5,112,348 [177]. - As of June 30, 2023, the company held $17,730,969 in a non-interest bearing bank account within the Trust Account [174]. - The Company intends to use substantially all funds in the Trust Account to complete its Business Combination [199]. - As of June 30, 2023, the Company had cash of $3,184 and a working capital deficit of $6,837,288, compared to cash of $14,129 and a deficit of $5,345,736 as of December 31, 2022 [222][230]. - The Company has a total of $4,362,601 outstanding under a working capital loan from the Sponsor as of June 30, 2023 [205]. - The outstanding amount under the working capital loan from the Sponsor was $4,362,601, with a maturity date of September 26, 2023 [231]. Warrants and Fair Value - As of June 30, 2023, the fair value of Public Warrants was $0.14 per warrant, up from $0.07 per warrant as of December 31, 2022 [159]. - The estimated fair value of the Private Placement Warrants was $379,750 as of June 30, 2023 [174]. - The fair value of the Public Warrants was measured at $1,610,000 as of June 30, 2023 [216]. - The outstanding Public Warrants and Private Placement Warrants as of June 30, 2023, were 11,500,000 and 5,425,000, respectively [213]. - The Company recognized a loss of $1,184,750 in connection with changes in the fair value of warrant liabilities for the six months ended June 30, 2023 [185]. - The estimated fair value of Private Placement warrant liabilities decreased from $2,278,500 as of December 31, 2021 to $379,750 as of December 31, 2022, reflecting a change of $(1,085,000) and $(54,250) respectively [219]. Business Operations and Plans - The company has incurred significant costs in pursuit of acquisition plans, raising substantial doubt about its ability to continue as a going concern [163]. - The company plans to address financial uncertainty through a Business Combination, with potential Working Capital Loans from the Sponsor or affiliates [163]. - The Company has not generated any operating revenues to date and only incurs expenses related to being a public company and due diligence [223]. - The Company signed a Merger Proxy/Business Combination Rate Agreement with Edgar Agents LLC, which includes a Transaction Success Fee of $50,000 upon successful completion of the merger [252]. Transaction Costs and Fees - The Company incurred $4,099,907 in transaction costs related to its Initial Public Offering, including $2,300,000 in underwriting fees [226]. - A total of $116,725,000 was placed in the Trust Account following the Initial Public Offering, with $69,700,629 redeemed by stockholders [226][227]. - The underwriters are entitled to a business combination marketing fee of $3,162,500, payable only upon completion of a business combination [206]. Accounting Standards - The Financial Accounting Standards Board issued ASU 2020-06, effective January 1, 2024, simplifying accounting for certain financial instruments [256]. - The new standard eliminates the separation of beneficial conversion and cash conversion features from convertible instruments [256]. - The Company is evaluating the impact of ASU 2020-06 but does not expect changes to its financial position, operations, or cash flows upon adoption [256].
Breeze Acquisition (BREZ) - 2023 Q2 - Quarterly Report