Business Combination - Achari Ventures Holdings Corp. I entered into a business combination agreement with Vaso Corporation, anticipated to close in Q2 2024, with a valuation of $176 million [123][126]. - Each Vaso Share will convert into Achari Shares based on an exchange ratio calculated from the total valuation and fully-diluted shares of Vaso [126]. - The Vaso Business Combination Agreement has been approved by the boards of directors of Achari, Vaso, and Merger Sub [124]. - The Vaso Business Combination is subject to various closing conditions, including stockholder approval and regulatory compliance [128]. - Support agreements have been signed by security holders representing 44% of Vaso's outstanding shares, committing to vote in favor of the business combination [139]. - The company has the option to extend the deadline for consummating its initial Business Combination by an additional six months, now set to January 19, 2024 [149]. - The Company was granted an extension until April 2, 2024, to complete the Vaso Business Combination, which is necessary for regaining compliance with Nasdaq's initial listing requirements [160]. Financial Performance - The company has not generated any operating revenues to date and does not expect to until after completing an initial Business Combination [140]. - For the three months ended March 31, 2024, the company reported a net loss of $530,117, a decrease from a net loss of $946,841 for the same period in 2023, representing a 44% improvement year-over-year [141]. - General and administrative expenses for Q1 2024 were $508,544, down from $925,964 in Q1 2023, indicating a 45% reduction [141]. - As of March 31, 2024, the company had $6,194,997 in the Trust Account, intended for the completion of the initial Business Combination [144]. - The company had cash of $10,524 outside the Trust Account as of March 31, 2024, to fund operational activities related to identifying target businesses [145]. - The company completed its Initial Public Offering on October 19, 2021, raising gross proceeds of $100,000,000 from the sale of 10,000,000 units at $10.00 per unit [142]. - The company anticipates generating non-operating income from interest on proceeds held in a U.S.-based trust account [140]. - The Sponsor will forfeit certain Achari Shares and warrants, retaining 750,000 Achari Shares and 1,000,000 private placement warrants post-combination [132]. - The Company has deferred underwriting commissions of $3.5 million that will be payable only upon the completion of an initial Business Combination [163]. Compliance and Regulatory Issues - The company is currently appealing a delisting determination from Nasdaq, with trading now occurring only on the OTC Markets system [154]. - The Company received a letter from Nasdaq on January 22, 2023, indicating non-compliance with Listing Rule 5450(b)(2)(B) due to having less than 1,100,000 publicly held shares, and was granted an extension until July 21, 2023, to regain compliance [155]. - On August 7, 2023, the Company regained compliance with Listing Rule 5450(b)(2)(B) after transferring certain Founder Shares [155]. - The Company was notified on February 24, 2023, of non-compliance with Listing Rule 5450(b)(2)(C) due to a market value of publicly held shares below $15 million, but regained compliance by August 7, 2023 [156]. - The Company faced non-compliance with Listing Rule 5250(c)(1) for delays in filing its Form 10-K and Form 10-Q, but regained compliance shortly after filing on April 25, 2023, and June 1, 2023, respectively [157]. - On March 23, 2023, the Company was notified of non-compliance with the $50 million Market Value of Listed Securities requirement, and received a delisting determination letter on October 3, 2023 [159]. Internal Controls and Risk Management - As of March 31, 2024, the company identified a material weakness in internal controls over financial reporting related to accounting and valuation for complex financial instruments and EPS disclosure [173]. - Management is dedicating significant resources to remediate internal control weaknesses and enhance processes for applying accounting standards [174]. - The company plans to improve access to accounting literature and increase communication with third-party professionals regarding complex accounting applications [174]. - There have been no changes in internal control over financial reporting that materially affected the company's internal controls during the most recently completed fiscal quarter [176]. - The company acknowledges that disclosure controls and procedures can only provide reasonable assurance, not absolute assurance, against errors and fraud [175]. - No legal proceedings are currently pending against the company [178]. - There have been no material changes to the risk factors disclosed in the company's Annual Report or other SEC filings as of the date of this Quarterly Report [178]. Financial Position - As of March 31, 2024, the company had no borrowings under Working Capital Loans, indicating a stable financial position [146]. - The Company has no off-balance sheet arrangements or long-term debt obligations as of March 31, 2024 [161]. - The Company is classified as an "emerging growth company," allowing it to take advantage of certain exemptions from reporting requirements [164]. - The Company accounts for warrants based on their specific terms, with Public Warrants qualifying for equity treatment and Private Placement Warrants for liability treatment [171].
Achari Ventures I(AVHI) - 2024 Q1 - Quarterly Report