Organization and Business Operations | Note 1 — Organization and Business Operations Organization and General Ackrell SPAC Partners I Co. (the “Company”) is a blank check company formed under the laws of the State of Delaware on September 11, 2018. The Company was formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (a “Business Combination” or an “Initial Business Combination”). The Company has selected December 31 as its fiscal year end. The Company’s sponsor is Ackrell SPAC Sponsors I LLC (the “Sponsor”), a Delaware limited liability company. As of June 30, 2022, the Company had not yet commenced any revenue-generating operations. All activity through June 30, 2022 relates to the Company’s formation, the Initial Public Offering (as defined below), the search for a prospective target for Initial Business Combination, and efforts toward consummating an Initial Business Combination. The Company will not generate any operating revenues until after the completion of its Initial Business Combination, at the earliest. The Company generates non-operating income in the form of interest income on investments held in the Trust Account and will recognize changes in the fair value of warrant liability as other income (expense) (See Note 10). On December 15, 2021, the Company formed Blackstone Products, Inc. (“Newco”), a Delaware corporation that is a wholly-owned subsidiary of the Company, and Ackrell Merger Sub Inc. (“Merger Sub”), a Delaware corporation that is a wholly-owned subsidiary of Newco, for the purpose of executing the Business Combination Agreement (as defined below). All activities of Newco and Merger Sub through June 30, 2022 related to executing the Business Combination Agreement and SEC filings related to the proposed Blackstone Business Combination (as defined below). On December 22, 2021, the Company, Newco and Merger Sub entered into a business combination agreement (the “Business Combination Agreement”) with North Atlantic Imports, LLC, an innovative griddle company d/b/a Blackstone Products (“Blackstone”), pursuant to which the two companies agreed to consummate a Business Combination where the combined company will own 100% of Blackstone post Business Combination (the “Blackstone Business Combination”). The aggregate consideration to be paid in the transactions is based on a pre-money Blackstone equity valuation of approximately $721 million. In connection with the proposed Blackstone Business Combination, the Company and Newco entered into subscription agreements (the “Subscription Agreements”) with certain investors (the “PIPE Investors”), pursuant to which Newco agreed to issue and sell to the PIPE Investors approximately 3,100,000 units (the “Newco Units”) for a purchase price of $10.00 per unit, for an aggregate of approximately $31,000,000 and approximately $111,000,000 principal amount of Newco convertible notes immediately prior to the closing of the proposed Blackstone Business Combination (the “PIPE Investment”). Each Newco Unit consists of one share of Newco common stock and one-half of a warrant to acquire Newco common stock at an exercise price of $11.50 per share. The Subscription Agreements provided investors with the right to terminate the Subscription Agreements if the proposed Blackstone Business Combination was not consummated by June 23, 2022, the date by which the Company were to have originally completed its Initial Business Combination in accordance with its Amended and Restated Certificate of Incorporation. These investors have exercised their right to terminate their subscription agreements. The Company is engaged in negotiations with those and other investors to modify the terms of the Subscription Agreements to eliminate the Newco Units portion of the private placement and to modify certain terms of the convertible notes. Financing The registration statements (“Registration Statements”) for the Company’s initial public offering (“Initial Public Offering” or “IPO”) were declared effective on December 21, 2020. On December 23, 2020, the Company consummated the Initial Public Offering of 13,800,000 units (the “Public Units”), which included the full exercise of the underwriter’s overallotment option, generating gross proceeds of $138,000,000, which is described in Note 3. Each Public Unit consists of (i) one subunit (the “Public Subunit”), which consists of one share of common stock (the “Public Share”) and one-half of one redeemable warrant, and (ii) one-half of one redeemable warrant (collectively, the redeemable warrants included in the Public Units and Public Subunits, the “Public Warrants”). Each whole Public Warrant entitles the holder to purchase one share of common stock at a price of $11.50 per share. Simultaneously with the closing of the IPO, the Company consummated the sale of an aggregate of 539,000 units (the “Private Units”) at a price of $10.00 per unit in a private placement to the Sponsor and EarlyBirdCapital, Inc. (“EarlyBirdCapital”), generating gross proceeds of an aggregate of $5,390,000, which is described in Note 4. Each Private Unit consists of (i) one subunit (the “Private Subunit”), which consists of one share of common stock (the “Private Share”) and one-half of one redeemable warrant, and (ii) one-half of one redeemable warrant (collectively, the redeemable warrants included in the Private Units and Private Subunits, the “Private Warrants”). Each whole Private Warrant entitles the holder to purchase one share of common stock at a price of $11.50 per share. Trust Account Following the closing of the IPO on December 23, 2020, an amount of $139,380,000 ($10.10 per Unit) from the net proceeds of the sale of the Public and Private Units in the IPO and private placement was placed in a trust account (“Trust Account”) which is invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act, which invest only in direct U.S. government treasury obligations, until the earlier of (a) the completion of the Company’s Initial Business Combination, (b) the redemption of any Public Subunits properly submitted in connection with a stockholder vote to amend the Company’s amended and restated certificate of incorporation, or (c) the redemption of the Company’s Public Subunits if the Company is unable to complete an Initial Business Combination within the Business Combination Period (as defined below). On December 23, 2021, the Company deposited $1,380,000 into the Trust Account and extended the period of time to consummate an Initial Business Combination (the “Business Combination Period”) by three months from December 23, 2021 to March 23, 2022. On March 21, 2022, the Company deposited an additional $1,380,000 into the Trust Account and further extended the Business Combination Period by an additional three months from March 23, 2022 to June 23, 2022. On June 27, 2022, the Company deposited an additional $200,000 into the Trust Account and further extended the Business Combination Period by an additional one month from June 23, 2022 to July 23, 2022. The aggregate of $2,960,000 for the two three-month extensions and the initial three month extension was funded by proceeds from the promissory notes issued to the Sponsor and Blackstone on December 23, 2021, March 16, 2022, and June 24, 2022, respectively (See Note 5 and Note 8). On April 28, 2022, pursuant to the trust agreement dated as of December 21, 2020 between the Company and Continental Stock Transfer & Trust Company (“CST”), the trustee of the Trust Account, the Company issued a request to CST to withdraw $129,279 of interest income from the Trust Account for the payment of the Company’s taxes. The proceeds from this withdrawal were deposited into the Company’s operating bank account on May 10, 2022. On June 14, 2022, the Company withdrew another $66,000 of interest income from the Trust Account for the payment of the Company’s taxes. On June 21, 2022, the Company’s stockholders approved an amendment to its Amended and Restated Certificate of Incorporation to further extend the Business Combination Period on a monthly basis up to three times from June 23, 2022 to not later than September 23, 2022, subject to the approval of the Board of Directors of the Company, provided the Sponsor or its designees deposit into the trust account for each monthly extension an amount equal to the lesser of $0.043 per share for each Public Subunit that has not been redeemed by June 23, 2022 and $200,000, within seven days after the commencement of each monthly extension period. In connection with the extension, an aggregate of 8,645,776 Public Subunits were presented for redemption. The Company paid cash in the aggregate amount of $89,068,505, or approximately $10.30 per subunit, to redeeming stockholders. Initial Business Combination The Company’s Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (net of taxes payable) at the time of the signing an agreement to enter into a Business Combination. However, the Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance that the Company will be able to successfully effect a Business Combination. The Company will provide its stockholders with the opportunity to redeem all or a portion of their Public Subunits included in the Public Units sold in the IPO upon the completion of an Initial Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The stockholders will be entitled to redeem their Public Subunits for a pro rata portion of the amount then on deposit in the Trust Account (approximately $10.35 per subunit as of June 30, 2022, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). The Company initially had 12 months from the closing of the IPO to consummate a Business Combination with an opportunity to extend the period of time up to two times each by an additional three months (for a total of up to 18 months to complete a business combination), subject to the Sponsor and/or its designees depositing into the Trust Account, on or prior to the applicable deadline, additional funds of $1,380,000 ($0.10 per unit) for each of the available three-month extensions. On December 23, 2021, the Company deposited $1,380,000 into the Trust Account and extended the period of time to consummate an Initial Business Combination by three months from December 23, 2021 to March 23, 2022. On March 21, 2022, the Company deposited an additional $1,380,000 into the Trust Account and further extended the period of time to consummate an Initial Business Combination by an additional three months from March 23, 2022 to June 23, 2022. On June 21, 2022, the Company held a special meeting of stockholders for the approval of an amendment to its Amended and Restated Certificate of Incorporation to extend on a monthly basis up to three times the Business Combination Period from June 23, 2022 to a date not later than September 23, 2022, subject to the approval of the Board of Directors of the Company, provided the Sponsor or its designees deposit into the trust account for each monthly extension an amount equal to the lesser of $0.043 per share for each Public Subunit that has not been redeemed by June 23, 2022 and $200,000, within seven days after the commencement of each extension period (the “Extension Amendment”). In connection with the Extension Amendment, an aggregate of 8,645,776 Public Subunits were presented for redemption. On June 22, 2022, the Company paid cash in the aggregate amount of $89,068,505, or approximately $10.30 per subunit, to redeeming stockholders. On June 27, 2022, the Company deposited an additional $200,000 into the Trust Account and further extended the period of time to consummate an Initial Business Combination by an additional month from June 23, 2022 to July 23, 2022. The aggregate of $2,960,000 for the two three-month extensions and the initial monthly extension was funded by proceeds from the promissory notes issued to the Sponsor and Blackstone on December 23, 2021, March 16, 2022, and June 24, 2022, respectively (See Note 5 and Note 8). The Sponsor, EarlyBirdCapital and the Company’s officer and directors have agreed to (i) waive their conversion rights with respect to their Founder Shares (See Note 5), Representative Shares (See Note 8) and Private Subunits (collectively, the “Private Securities”) in connection with the consummation of a business combination, (ii) to waive their rights to liquidating distributions from the Trust Account with respect to their Private Securities if the Company fails to consummate a Business Combination by the end of the Business Combination Period, as extended in accordance with its Amended and Restated Certificate of Incorporation, as amended, and (iii) not to propose an amendment to the Company’s Amended and Restated Certificate of Incorporation that would affect the substance or timing of the Company’s obligation to redeem 100% of its Public Subunits if the Company does not complete a Business Combination, unless the Company provides the public stockholders with the opportunity to redeem their Public Subunits in conjunction with any such amendment. Liquidation The holders of the Private Securities will not participate in any liquidation distribution with respect to such securities. In the event of such distribution, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be less than the $10.35 per Public Unit as of June 30, 2022. The Sponsor has agreed that it will be liable to ensure that the proceeds in the Trust Account are not reduced below $10.10 per Public Subunit by the claims of target businesses or claims of vendors or other entities that are owed money by the Company for services rendered or contracted for or products sold to the Company. The agreement entered into by the Sponsor specifically provides for two exceptions to the indemnity it has given: it will have no liability (1) as to any claimed amounts owed to a target business or vendor or other entity who has executed an agreement with us waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account, or (2) as to any claims for indemnification by the underwriters of the Company’s IPO against certain liabilities, including liabilities under the Securities Act. The Company has not asked the Sponsor to reserve for such indemnification obligations, nor has the Company independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations. The Company believes that the Sponsor’s only assets are securities of the Company. Therefore, the Company believes it is unlikely that Sponsor will be able to satisfy its indemnification obligations if it is required to do so. Liquidity and Going Concern As of June 30, 2022, the Company had cash outside the Trust Account of $195,111 available for working capital needs. All remaining cash and securities were held in the Trust Account and are generally unavailable for the Company’s use prior to an initial business combination (except that the Company may withdraw interest generated in the Trust Account to pay taxes) and are restricted for use either in a Business Combination or to redeem Public Subunits. As of June 30, 2022, none of the amounts on deposit in the Trust Account was available to be withdrawn as described above (except $71,099 of interest income that may be withdrawn to pay taxes). Through June 30, 2022, the Company’s liquidity needs were satisfied through receipt of $5,000 from the sale of the Founder Shares (See Note 5), advances from the Sponsor in an aggregate amount of $300,000 which were repaid upon the IPO, and the remaining net proceeds from the IPO and private placement (See Notes 4 and 5) held outside of the Trust Account. Additionally, the Company received $1,380,000 from the Sponsor Extension Loan (see Note 5) and another $1,380,000 from the Blackstone Extension Loan (See Note 8), which the Company deposited into the Trust Account to extend the Business Combination Period from December 23, 2021 to July 23, 2022. On April 6, 2022, the Company issued an unsecured promissory note in the principal amount of $115,000 to Blackstone to fund payment of fees due to Nasdaq (See Note 8). On April 27, 2022, the Company issued an unsecured promissory note, the terms of which were later amended and restated on May 11, 2022, in the principal amount of $385,000 to Blackstone to fund the Company’s continued operations (see Note 8). On June 21, 2022, the Company issued an unsecured promissory note in the principal amount of up to $600,000 to Blackstone (the “Second Blackstone Extension Loan”) to extend the period during which the Company may consummate its initial Business Combination from June 23, 2022 to September 23, 2022 (See Note 8). As of June 30, 2022, the Company had drawn down $200,000 on the Second Blackstone Extension Loan. On July 22, 2022, the Company drew down an additional $200,000 on the Second Blackstone Extension Loan, for an aggregate amount of $400,000 (see Note 11). On April 28, 2022, pursuant to the trust agreement dated as of December 21, 2020 between the Company and CST, the Company withdrew $129,279 of interest income from the Trust Account for the payment of the Company’s taxes. On June 14, 2022, the Company withdrew another $66,000 of interest income from the Trust Account for the payment of the Company’s taxes. On August 4, 2022, the Company withdrew an additional $90,380 of interest income from the Trust Account for the payment of the Company’s taxes (See Note 11). The Company’s initial stockholders, officers, directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company may repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans may be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans, other than the interest on such proceeds that may be released for working capital purposes. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into units of the post Business Combination entity at a price of $10.00 per unit. As of June 30, 2022 and December 31, 2021, no Working Capital Loans were outstanding. Until consummation of its Business Combination, the Company will be using the funds not held in the Trust Account, and any additional Working Capital Loans from the Initial Stockholders, the Sponsor, the Company’s officers and directors, or their respective affiliates, for identifying and evaluating prospective acquisition candidates, performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting the target business to acquire and structuring, negotiating and consummating the Business Combination. The Company anticipates that the $195,111 outside of the Trust account as of June 30, 2022 will not be sufficient to allow the Company to operate for at least the next 12 months, assuming that a Business Combination is not consummated during that time. Additionally, the Company may need to obtain additional financing to consummate its Initial Business Combination but there is no assurance that new financing will be available to the Company on commercially acceptable terms. Furthermore, if the Company is not able to consummate a business combination by August 23, 2022 or September 23, 2022 if extended, it will trigger the Company’s automatic winding up, liquidation and dissolution. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. |