Syntec Optics (OPTX) - 2023 Q2 - Quarterly Report

Part I. FINANCIAL INFORMATION This section provides the interim unaudited condensed financial statements and management's discussion and analysis for OmniLit Acquisition Corp Interim Unaudited Condensed Financial Statements This section presents OmniLit Acquisition Corp.'s unaudited condensed financial statements, including balance sheets, statements of operations, and cash flows, for the periods ended June 30, 2023 Condensed Balance Sheets Total assets increased to $14.86 million as of June 30, 2023, from $14.27 million at year-end 2022, while total liabilities rose to $1.68 million from $0.62 million Condensed Balance Sheet Highlights (in USD) | Metric | June 30, 2023 (Unaudited) | December 31, 2022 (Audited) | | :--- | :--- | :--- | | Assets | | | | Cash on hand | $467,760 | $117,506 | | Marketable securities and cash held in Trust Account | $14,268,619 | $14,011,070 | | Total Assets | $14,860,326 | $14,271,766 | | Liabilities & Stockholders' Deficit | | | | Total current liabilities | $1,176,296 | $117,070 | | Total liabilities | $1,676,296 | $617,070 | | Common stock subject to possible redemption | $14,169,629 | $13,919,834 | | Total stockholders' deficit | ($985,599) | ($265,139) | | Total Liabilities and Stockholders' Deficit | $14,860,326 | $14,271,766 | Unaudited Condensed Statements of Operations The company reported a net loss of $258,018 for the three months and $470,665 for the six months ended June 30, 2023, primarily due to increased operating costs Statements of Operations Summary (in USD) | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Operating costs | $366,781 | $137,279 | $688,031 | $321,163 | | Loss from operations | ($366,781) | ($137,279) | ($688,031) | ($321,163) | | Interest earned on investment held in Trust Account | ($166,639) | ($208,234) | ($302,669) | ($220,201) | | Net income (loss) | ($258,018) | $64,568 | ($470,665) | ($107,349) | | Basic and diluted net income (loss) per share | ($0.04) | $0.01 | ($0.08) | ($0.01) | Unaudited Condensed Statements of Cash Flows Net cash used in operating activities was $389,806 for the six months ended June 30, 2023, with financing activities providing $740,061, resulting in a net cash increase of $350,255 Cash Flow Highlights for Six Months Ended June 30 (in USD) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | ($389,806) | ($319,178) | | Net cash provided by financing activities | $740,061 | $107,728 | | Net change in cash | $350,255 | ($211,450) | | Cash, end of the period | $467,760 | $283,149 | Notes to Unaudited Condensed Financial Statements The notes detail the company's SPAC status, the definitive merger agreement with Syntec Optics, Inc., a going concern warning, and related-party transactions - The company operates as a Special Purpose Acquisition Corporation (SPAC), with its IPO completed on November 12, 2021, and no operations commenced beyond seeking a business combination[19][20][21] - A definitive merger agreement was signed with Syntec Optics, Inc. on May 9, 2023, pending stockholder and regulatory approvals[32][35] - The mandatory liquidation deadline of November 12, 2023, raises substantial doubt about the company's ability to continue as a going concern if a business combination is not completed[41] - The Sponsor provided a working capital loan of $694,941 via a promissory note dated June 21, 2023, to fund pre-business combination operations[39][84] Management's Discussion and Analysis of Financial Condition and Results of Operations This section discusses the company's financial condition and results, highlighting its status as a blank check company with no operating revenue, a net loss of $470,665 for the first six months of 2023, and liquidity reliance on cash outside the trust and sponsor loans - The company is a blank check company formed solely to effect a business combination, with no other operational activities[116][118] Net Loss Summary (in USD) | Period | Net Loss | | :--- | :--- | | Six Months Ended June 30, 2023 | ($470,665) | | Six Months Ended June 30, 2022 | ($107,349) | - As of June 30, 2023, the company held $14,268,619 in the Trust Account and $467,760 in cash outside for working capital[127][130] - The sponsor may provide up to $1,500,000 in working capital loans, convertible into warrants, to finance transaction costs[131] Quantitative and Qualitative Disclosures Regarding Market Risk The company is not subject to material market or interest rate risk, as Trust Account funds are invested in short-term U.S. government treasury obligations or money market funds - The company is not subject to any material market or interest rate risk as of June 30, 2023[143] - IPO proceeds in the Trust Account are invested in short-term U.S. government treasury obligations or money market funds, minimizing interest rate risk exposure[143] Controls and Procedures Management concluded that disclosure controls and procedures were not effective as of June 30, 2023, due to a material weakness in internal control over financial reporting related to tax provision reconciliation, with remediation efforts underway - Management concluded that disclosure controls and procedures were not effective as of June 30, 2023[147] - A material weakness was identified in internal controls over financial reporting regarding technology and procedures for tax provision reconciliation[146][147] - Remediation efforts include enhancing written policies for information flow and general control activities over technology between accounting and tax functions[149] Part II. OTHER INFORMATION This section covers other information including legal proceedings, risk factors, unregistered sales of equity securities, and exhibits Legal Proceedings The company is not currently a party to any material litigation or legal proceedings that could materially adversely affect its business - The company is not currently a party to any material litigation or legal proceedings[154] Risk Factors There have been no material changes to the risk factors previously disclosed in the company's Initial Public Offering Prospectus - As of this report's date, no material changes have occurred to the risk factors previously disclosed in the company's IPO Prospectus[155] Unregistered Sales of Equity Securities and Use of Proceeds This section details the company's Initial Public Offering, consummated on November 12, 2021, which generated gross proceeds of $143,750,000 from 14,375,000 units at $10.00 per unit - The company's IPO of 14,375,000 Units at $10.00 per unit on November 12, 2021, generated gross proceeds of $143,750,000[156] Exhibits This section lists the exhibits filed with the Form 10-Q, including certifications by the Principal Executive Officer and Principal Financial Officer, and Inline XBRL data files - The report includes required CEO and CFO certifications under Sections 302 and 906 of the Sarbanes-Oxley Act[158]