Yotta Acquisition Corporation(YOTAU) - 2023 Q4 - Annual Report

Financial Performance - As of December 31, 2023, the company reported a net income of $1,429,419, which included interest income of$2,788,029 and other income of $635,100, offset by total expenses of$1,993,710[77]. - Net income for the year ended December 31, 2023, was $1,429,419, compared to$145,189 in 2022, indicating a substantial growth[203]. - Basic and diluted net income per share for common stock was $0.17 in 2023, up from$0.01 in 2022[203]. - Interest income increased to $2,788,029 in 2023 from$1,651,461 in 2022, reflecting improved financial management[203]. - The Company recorded $635,100 as other income from extension fees received from NaturalShrimp[234]. IPO and Capital Structure - The company generated gross proceeds of$100,000,000 from the IPO of 10,000,000 units at an offering price of $10.00 per unit on April 22, 2022[78]. - The underwriters fully exercised the over-allotment option, purchasing an additional 1,500,000 units at a price of$10.00 per unit, generating gross proceeds of $15,000,000[79]. - A total of$115,000,000 from the IPO and private placements was deposited in a trust account for the benefit of public stockholders[57]. - Total transaction costs for the IPO amounted to $6,764,402, including$2,300,000 in underwriting fees[216]. - The Company completed its IPO on April 22, 2022, raising gross proceeds of $100 million from the sale of 10,000,000 Public Units at$10.00 per unit[214]. Business Combination and Future Plans - The company entered into a merger agreement with NaturalShrimp Incorporated, which includes issuing 17.5 million shares of common stock to former security holders of the target[61]. - As of the September Special Meeting, stockholders approved an extension for the company to complete a business combination until August 22, 2024[66]. - If a Business Combination is not completed by August 22, 2024, the Company will face mandatory liquidation and dissolution[85]. - The Company intends to use funds from the Trust Account primarily for acquiring a target business and covering related expenses[81]. - The Company may need additional financing to complete its Business Combination or to redeem public shares, which could involve issuing more securities or incurring debt[84]. Financial Position and Assets - As of December 31, 2023, total assets decreased to $8,574,213 from$116,982,661 in 2022, indicating a significant decline in the company's financial position[199]. - Current assets increased to $652,395 in 2023 from$331,200 in 2022, primarily driven by cash growth[199]. - Cash balance rose to $652,395 in 2023 compared to$235,864 in 2022, reflecting improved liquidity[199]. - Investments held in the Trust Account decreased to $7,921,818 in 2023 from$116,651,461 in 2022, indicating a substantial reduction in available investment capital[199]. - The Company has not raised additional capital needed to fund operations and complete any business combination, which poses a risk to its future[194]. Internal Controls and Governance - The Company lacks sufficient internal controls, including segregation of duties and controls over financial reporting, which raises concerns about its ability to prevent material misstatements[103]. - Management has identified material weaknesses in internal controls that need remediation before being considered effective[107]. - The audit committee consists of independent directors and is responsible for reviewing financial statements and ensuring compliance with applicable laws[124]. - The compensation committee, also composed of independent directors, evaluates and approves executive compensation based on performance[132]. - The company has adopted a code of ethics applicable to all executive officers, directors, and employees[135]. Risks and Challenges - If the Company cannot complete a Business Combination by August 22, 2024, it will cease operations except for liquidation purposes[238]. - The ongoing conflicts, including Russia/Ukraine and Hamas/Israel, may materially affect the Company's ability to consummate a Business Combination[240]. - The financial statements do not include adjustments related to uncertainties about the Company's ability to continue as a going concern[238]. - The Company recorded an excise tax liability of $1,121,204 as of December 31, 2023, due to redemptions by public stockholders[243]. Management and Leadership - Hui Chen has been the Chief Executive Officer and director since December 2021, with a background in computer science and law, and has experience with Fortune 500 companies[116]. - Robert L. Labbe has served as Chief Financial Officer since December 2021, bringing over 30 years of real estate finance experience[117]. - The board includes three independent directors: Brandon Miller, Daniel M. McCabe, and Michael Lazar, ensuring compliance with Nasdaq's independence requirements[122]. Shareholder Matters - The Company issued 2,875,000 shares of common stock to the Initial Stockholders for an aggregate consideration of$25,000[160]. - As of March 7, 2023, Hui Chen holds 3,201,833 shares, representing 81.17% of the outstanding common stock[157]. - The Initial Stockholders have agreed not to transfer their Insider Shares until certain conditions are met, including a stock price of $12.50 per share for 20 trading days[161]. - The insiders have agreed to vote shares in favor of the initial business combination and waive rights to amounts held in the trust account if the combination is not completed in time[144].