Simultaneous with the closing of our IPO, we completed the sale of 675,000 Private Placement Units in a private placement to our Sponsor, Roth Capital Partners, LLC Craig-Hallum Capital Group, and certain of their designees.
Our initial stockholders, including our Sponsor, our independent directors, our underwriting representatives and their affiliates (the “Initial Stockholders”) collectively own 2,875,000 shares of our common stock that were issued prior to our IPO, which shares we refer to as “Founder Shares.” The Founder Shares and an additional 675,000 shares from the Private Placement Units owned by the Initial Stockholders, are not subject to redemption pursuant to the Election.
We will not proceed with the Extension Amendment or the amendment of the Trust Agreement if the number of public shares redeemed subject to the Election causes us to have less than $5,000,001 of net tangible assets following approval of the Extension Proposal and the Trust Amendment Proposal.
To exercise your redemption rights, you must demand that the Company redeem your public shares for a pro rata portion of the funds held in the Trust Account, and tender your shares to the Company’s transfer agent at least two business days prior to the Special Meeting (or April 12, 2023). The redemption rights include the requirement that a stockholder must identify itself in writing as a beneficial holder and provide its legal name, phone number, and address in order to validly redeem its public shares. You may tender your shares by either delivering your share certificate to the transfer agent or by delivering your shares electronically using the Depository Trust Company’s DWAC (Deposit/Withdrawal At Custodian) system. If you hold your shares in street name, you will need to instruct your bank, broker or other nominee to withdraw the shares from your account in order to exercise your redemption rights.
The withdrawal of funds from the Trust Account in connection with the Election will reduce the amount held in the Trust Account following the Election, and the amount remaining in the Trust Account may be only a small fraction of the approximately $119.7 million that was in the Trust Account as of March 21, 2023. In such event, the Company may need to obtain additional funds to complete the business combination or another initial Business Combination, and there can be no assurance that such funds will be available on terms acceptable to the parties or at all.
If the Extension Proposal and the Trust Amendment Proposal are not approved and we do not consummate a business combination by April 20, 2023, in accordance with our charter, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter subject to lawfully available funds therefor, redeem 100% of the public shares of common stock in consideration of a per-share price, payable in cash, equal to the quotient obtained by dividing (A) the aggregate amount then on deposit in the Trust Account, including interest (net of taxes payable, less up to $50,000 of such net interest to pay dissolution expenses), by (B) the total number of then outstanding public shares of common stock, which redemption will completely extinguish rights of public stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining stockholders and the Board in accordance with applicable law, dissolve and liquidate, subject in each case to the Company’s obligations under the Delaware General Corporation Law, which we refer to as the “DGCL”, to provide for claims of creditors and other requirements of applicable law.
There will be no distribution from the Trust Account with respect to the Company’s warrants, which will expire worthless in the event of our winding up. In the event of a liquidation, our Sponsor and our officers and directors will not receive any monies held in the Trust Account as a result of their ownership of 4,743,750 Founder Shares that were issued prior to our IPO. As a consequence, a liquidating distribution will be made only with respect to the public shares.
The affirmative vote of at least 65% of the Company’s outstanding shares of common stock, including the Founder Shares, will be required to approve the Extension Proposal and the Trust Amendment Proposal. Notwithstanding stockholder approval of the Extension Proposal and the Trust Amendment Proposal, our Board will retain the right to abandon and not implement the Extension Amendment at any time without any further action by our stockholders.
Approval of the Adjournment Proposal requires the affirmative vote of the majority of the votes cast by stockholders represented in person or by proxy at the Special Meeting.