Financial Performance - Net income for the six months ended June 30, 2023, was $3,205,754, compared to a net loss of $353,451 for the same period in 2022, indicating a turnaround in performance[11] - General and administrative expenses decreased to $477,786 for the six months ended June 30, 2023, down from $629,604 in the same period of 2022, a reduction of approximately 24%[11] - The company incurred an income tax expense of $987,143 for the six months ended June 30, 2023, compared to $67,900 for the same period in 2022, indicating a significant increase in tax obligations[11] - The Company had a net income of approximately $855,000 for the three months ended June 30, 2023, compared to a net loss of approximately $80,000 for the same period in 2022[131][132] - For the six months ended June 30, 2023, the Company reported a net income of approximately $3.2 million, up from a net loss of approximately $353,000 in the same period of 2022[133][134] Assets and Liabilities - Total current assets increased to $991,711 as of June 30, 2023, compared to $654,413 as of December 31, 2022, representing a growth of approximately 51.5%[9] - The company reported total liabilities of $14,520,783 as of June 30, 2023, compared to $12,295,708 as of December 31, 2022, an increase of approximately 18%[9] - Cash at the end of the period increased to $848,639 from $409,725, reflecting a growth of approximately 107%[19] - As of June 30, 2023, the Company had approximately $849,000 in its operating bank account and a working capital deficit of approximately $2.3 million[39] - The Company has significant cash balances that regularly exceed the federally insured limit of $250,000, which poses a credit risk[53] Trust Account and IPO - The Trust Account initially held $306 million, which may only be invested in U.S. government securities or money market funds[29] - The Company completed its IPO on November 19, 2021, raising gross proceeds of $300 million from the sale of 30 million units at $10.00 per unit[25] - The Company placed $306 million in cash into the Trust Account from the net proceeds of its IPO, with an additional $1,656,890 held outside the Trust Account for working capital purposes[137][150] - The Trust Account held $306,000,000 from the IPO proceeds, which is intended for the initial business combination[122] Business Combination - The Company must complete a Business Combination with a fair market value of at least 80% of the assets held in the Trust Account[28] - The Company has until November 19, 2023, to complete a Business Combination, following an extension approved by stockholders[37] - The Company intends to complete a Business Combination before the mandatory liquidation date of November 19, 2023[139] - The Company has not yet selected a specific Business Combination target and has not engaged in substantive discussions regarding an initial Business Combination[22] Shareholder Activity - On April 20, 2023, stockholders redeemed 25,845,428 shares for approximately $269.6 million, leaving about 4,154,572 shares outstanding[37] - The Company had 4,154,572 shares of Class A common stock subject to possible redemption as of June 30, 2023, compared to 30,000,000 shares as of December 31, 2022[61] - Holders of 25,845,428 shares of Class A common stock redeemed their shares for a cash redemption price of approximately $10.43 per share, totaling an aggregate redemption amount of $269,597,445[125] Financial Instruments and Valuation - The Company has a deferred underwriting commission of $11,200,000, payable upon completion of the initial Business Combination[91] - The fair value of the Non-Redemption Agreements derivative liability was $1,800,000 as of June 30, 2023, reflecting a change of $30,000 from the previous period[116] - The market price of Class A common stock was $10.41 as of June 30, 2023, with a volatility of 52.6% and a risk-free rate of 5.13%[116] - The Company is authorized to issue 300,000,000 shares of Class A common stock and 20,000,000 shares of Class B common stock[101][102] Tax and Regulatory Matters - The Company has a full valuation allowance against deferred tax assets as of June 30, 2023, indicating that it does not expect to realize these assets[70] - The Company has not recognized any unrecognized tax benefits or accrued interest and penalties related to tax positions as of June 30, 2023[72] - The Inflation Reduction Act of 2022 introduces a 1% excise tax on stock repurchases, which may impact the Company's cash available for a Business Combination[43] Other Financial Information - The Company incurred transaction costs for the IPO totaling approximately $17.82 million, including $5.3 million in underwriting commissions[27] - The Company has not borrowed under the Working Capital Loans as of June 30, 2023[86] - The Company has agreed to maintain funds in the Trust Account in interest-bearing U.S. government securities until the earlier of the initial business combination or liquidation[94] - The Company has entered into Non-Redemption Agreements to extend the time for consummating an initial business combination until November 19, 2023[92]
ShoulderUp Technology Acquisition (SUAC) - 2023 Q2 - Quarterly Report