Financial Position and Capital Requirements - As of March 27, 2023, approximately $386,306 remained available outside the Trust Account to fund working capital requirements[110] - The company may need to seek additional loans from its Sponsor to fund its search for an initial business combination, taxes, and completion of the business combination[109] - The balance of the Trust Account was approximately $7.9 million as of March 27, 2023[124] - If the balance of the Trust Account is reduced below $116,150,000 due to negative interest rates, the per-share redemption amount may be less than $10.10[124] - The company has authorized the issuance of up to 50,000,000 shares of common stock and 1,000,000 shares of preferred stock, with 35,249,000 shares authorized but unissued immediately after the IPO[177] - As of December 31, 2022, the company had $809,481 in its operating bank accounts and a working capital surplus of $248,249, raising substantial doubt about its ability to continue as a going concern[236] Redemption and Liquidation - If the initial business combination is not completed, public stockholders may receive approximately $10.10 per share upon liquidation of the Trust Account, with potential for less in certain circumstances[110] - Public stockholders are entitled to receive their pro-rata share of the proceeds held in the Trust Account if the initial business combination is not completed[124] - If the company does not complete its initial business combination, public stockholders may only receive approximately $10.10 per share or less upon liquidation[139] - Stockholders holding more than 15% of shares will lose the ability to redeem shares beyond that threshold if stockholder approval is sought without conducting redemptions[111] - Public stockholders wishing to redeem shares must comply with specific requirements, which may complicate the redemption process[208] - If the initial business combination is not consummated, stockholders may only receive $10.10 per share or less upon redemption, and the warrants will become worthless[218] Business Combination and Acquisition Risks - The company may seek initial business combination opportunities with early-stage or financially unstable businesses, which could lead to volatile revenues[142] - Management has virtually unrestricted flexibility in identifying and selecting a prospective acquisition candidate, which may not align with stockholders' best interests[141] - The company is not required to obtain an independent investment banking firm's opinion on the fairness of the acquisition price, relying instead on its board of directors' judgment[145] - The company may face intense competition from established entities with greater resources in pursuing initial business combinations[214] - The company may face significant income, withholding, and other tax obligations in multiple jurisdictions, which could adversely affect after-tax profitability and financial condition[153] Governance and Management Interests - The company’s officers and directors may have financial interests that differ from public stockholders, influencing their motivation to complete the initial business combination[175] - The personal and financial interests of the company’s officers and directors may influence their motivation in selecting a target for the initial business combination[165] - Key personnel may negotiate employment or consulting agreements with target businesses, potentially leading to conflicts of interest in determining the most advantageous initial business combination[154] - The company’s management team has significant experience, but their involvement in other companies may lead to litigation or investigations that could impede the identification of target businesses[162] Securities and Market Considerations - The company may issue shares at a price less than the prevailing market price during the initial business combination, potentially diluting existing shareholders[182] - The potential issuance of additional shares upon exercise of warrants could make the company a less attractive vehicle for initial business combinations, increasing the cost of acquiring target businesses[202] - The company may redeem outstanding warrants at a price of $0.01 per warrant if the last reported sales price of common stock equals or exceeds $18.00 per share for any 20 trading days within a 30 trading-day period[199] - The exercise of public warrants on a cashless basis will result in holders receiving fewer shares than if they exercised for cash, reducing the potential upside of their investment[189] - The registration of a significant number of securities for trading may adversely affect the market price of the company's common stock[207] Regulatory and Compliance Issues - The company must ensure that investment securities do not constitute more than 40% of total assets to avoid being regulated as an investment company[127] - Compliance with the Sarbanes-Oxley Act may increase the time and costs associated with completing an acquisition[225] - The company’s amended certificate designates the Court of Chancery of the State of Delaware as the exclusive forum for certain types of actions, which may limit stockholders' ability to obtain a favorable judicial forum[239] - The company’s independent registered public accounting firm expressed substantial doubt about its ability to continue as a "going concern" in their report[236] Miscellaneous - The company may face write-downs or impairments post-business combination, which could negatively impact reported earnings and market perceptions[113] - Indemnification claims against directors and officers may not be satisfied if the company lacks sufficient funds outside the Trust Account[118] - Stockholders may be held liable for claims by third parties against the company to the extent of distributions received upon redemption of their shares[119] - The company does not intend to comply with certain Delaware General Corporation Law procedures for liquidating distributions, which may increase stockholder liability[120] - The company may extend the deadline to consummate its initial business combination from January 11, 2023, to July 11, 2023, at a cost of $10,000 per extension, totaling up to $60,000 for six extensions[237] - The company has no obligation to net cash settle the warrants, which may lead to the warrants becoming worthless[199] - The company has no changes or disagreements with accountants on accounting and financial disclosure[286]
Western Acquisition Ventures Corp.(WAVSU) - 2022 Q4 - Annual Report