Redwoods Acquisition (RWOD) - 2023 Q1 - Quarterly Report

Financial Performance - For the three months ended March 31, 2023, the company reported a net income of $1,120,611, primarily driven by interest income of $1,250,067 from investments held in the Trust Account[131]. - The company incurred general and administrative expenses of $293,654 for the three months ended March 31, 2023[131]. - The company has not generated any operating revenues to date and does not expect to do so until after completing its initial business combination[130]. IPO and Trust Account - The company completed its IPO on April 4, 2022, raising gross proceeds of $100,000,000 from the sale of 10,000,000 Public Units, with each unit priced at $10.00[132]. - Following the IPO, the company placed a total of $116,150,000 in a Trust Account for the benefit of public stockholders, after incurring transaction costs of $8,365,339[135]. - As of March 31, 2023, the company held marketable securities in the Trust Account amounting to $119,416,545, which are invested in U.S. government securities[138]. - As of March 31, 2023, the assets in the Trust Account were held in cash and U.S. Treasury securities, classified as trading securities at fair value[150]. Working Capital and Redemptions - The company has a working capital deficit of $598,362 as of March 31, 2023, excluding redemptions payable to public stockholders[140]. - An aggregate of 6,103,350 shares of common stock were tendered for redemption, resulting in a total redemption amount of $63,169,451, or $10.35 per share[136]. - Common stock subject to possible redemption is classified as temporary equity and presented at redemption value, with changes recognized immediately[159]. Business Combination and Financing - The company has until July 4, 2023, to complete a business combination, with the possibility of extending this deadline up to five times until December 4, 2023[141]. - The company issued a promissory note of up to $150,000 to the Sponsor on March 22, 2023, which is payable upon the closing of the business combination[143]. - The company issued an unsecured, non-interest bearing promissory note of up to $360,000 to the Sponsor, payable upon the closing of the Business Combination or liquidation[144]. - The underwriters received a cash underwriting discount of $0.25 per unit, totaling $2,875,000, and deferred underwriting commissions of $0.375 per unit, amounting to $4,312,500, contingent on completing an initial business combination[147]. - The company will pay the Sponsor $10,000 per month for administrative services, which will cease upon the completion of the initial business combination or liquidation[146]. Accounting Policies - The fair value of certain financial instruments approximates their carrying amounts, with cash and cash equivalents estimated to approximate carrying values as of March 31, 2023[152]. - The company complies with FASB ASC 260 for net income (loss) per share, allocating undistributed income (loss) between redeemable and non-redeemable shares[160]. - The company has elected to account for its Public Warrants as equity and Private Warrants as liabilities, with changes in fair value recognized as non-cash gains or losses[156]. - The company has identified critical accounting policies that may materially affect reported amounts, requiring management estimates and assumptions[149]. Rights and Agreements - The company granted Chardan a right of first refusal for future public and private equity offerings for 18 months post-initial business combination[148].