Related Party Transactions |
6 Months Ended |
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Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 5 — Related Party Transactions
Founder Shares
On September 25, 2021, the Company issued 1,437,500 shares of common stock to the Initial Stockholders (the “Founder Shares”) for an aggregated consideration of $25,000, or approximately $0.017 per share.
The Initial Shareholders have agreed to forfeit up to up to 187,500 Founder Shares to the extent that the underwriters’ over-allotment is not exercised in full, so that the Initial Stockholders will collectively own 20% of the Company’s issued and outstanding shares after the IPO (assuming the Initial Stockholders do not purchase any Public Shares in the IPO and excluding the Private Units). As a result of the underwriter’s partial exercise of the over-allotment option on October 4, 2022, 119,250 shares of the Founder Shares were forfeited for no consideration on October 7, 2022 resulting in 1,318,250 Founder Shares outstanding after the forfeiture.
The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of their Founder Shares until, with respect to 50% of the Founder Shares, the earlier of six months after the consummation of a Business Combination and the date on which the closing price of the common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period commencing after a Business Combination and, with respect to the remaining 50% of the Founder Shares, until the six months after the consummation of a Business Combination, or earlier, in either case, if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property.
Promissory Note — Related Party
On September 5, 2021, the Sponsor agreed to loan the Company up to an aggregate amount of $200,000 to be used, in part, for transaction costs incurred in connection with the IPO (the “Promissory Note”). The Promissory Note is unsecured, interest-free and due on the closing of the IPO. The Company repaid the outstanding balance of $200,000 to the Sponsor on October 7, 2022.
The Company received $155,025 from the Sponsor at the closing of IPO to finance transaction costs in connection with searching for a target business. On October 7, 2022, the Sponsor converted the outstanding balance of $155,025 to the Promissory Note. On March 22 and June 26, 2023, the Sponsor loaned the Company $200,000 and $240,000, respectively, to be used, in part, for extension deposits. Each Promissory Note is unsecured, interest-free and due on the date the Company consummates a business combination.
As of June 30, 2023 and December 31, 2022, $595,025 and $155,025 were outstanding under the Promissory Notes, respectively.
Related Party Loans
In addition, in order to finance transaction costs in connection with searching for a target business or consummating an intended initial business combination, the initial stockholders, officers, directors or their affiliates may, but are not obligated to, loan the Company funds as may be required. In the event that the initial business combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay such loaned amounts, but no proceeds from the Trust Account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into Private Units at a price of $10.00 per unit at the option of the lender. The terms of such related party loans, if any, have not been determined and no written agreements exist with respect to such loans.
As of June 30, 2023 and December 31, 2022, the Company had no borrowings under the working capital loans.
Administrative Services Agreement
The Company entered into an Administrative Service Agreement, commencing on the effective date of the IPO through the earlier of the Company’s consummation of a Business Combination and its liquidation, to pay the Sponsor a total of $10,000 per month for office space, administrative and support services. The monthly fees will be ceased upon completion of an initial Business Combination or liquidation. For the three and six months ended June 30, 2023 the Company incurred $30,000 and $60,000, respectively, in fees for these services. The Company accrued $60,000 and $28,387 administrative fees in the accompanying balance sheets as of June 30, 2023 and December 31, 2022, respectively. The Company did not incur any administrative fees for the three and six months ended June 30, 2022. |