Angel Studios, Inc 10-Q for FY2023 Q3

Angel Studios, Inc. (ANGX)

10-Q 2023-11-13 For: 2023-09-30

Added on April 12, 2026

About this 10-Q

Angel Studios, Inc filed this 10-Q on November 13, 2023, covering the quarter ended September 30, 2023 (FY2023 Q3).

Headline figures

Quarter ended September 30, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Net loss: $10.52K; compared with net income of $1.31M a year earlier

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Delaware (State or other jurisdiction of incorporation or organization)	85-3483780 (I.R.S. Employer Identification Number)

1745 Grand Avenue Del Mar, California (Address of principal executive offices)	92014 (Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Units, each consisting of one share of Class A common stock, $0.0001 par value, and one-half of one warrant	PORT.U	The New York Stock Exchange
Class A common stock, par value $0.0001 per share	PORT	The New York Stock Exchange
Warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50, subject to adjustment	PORT.W	The New York Stock Exchange


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
	☐	Emerging growth company	☒

PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Condensed Balance Sheets as of September 30, 2023 (Unaudited) and December 31, 2022	1
	Condensed Statements of Operations for the three and nine months ended September 30, 2023 and 2022	2
	Condensed Statements of Changes in Common Stock Subject to Possible Redemption and Stockholders’ Deficit for the three and nine months ended September 30, 2023 and 2022	3
	Condensed Statements of Cash Flows for the nine months ended September 30, 2023 and 2022	5
	Notes to Condensed Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures Regarding Market Risk	31
Item 4.	Controls and Procedures	31
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings.	33
Item 1A.	Risk Factors.	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	33
Item 3.	Defaults Upon Senior Securities.	34
Item 4.	Mine Safety Disclosures.	34
Item 5.	Other Information.	34
Item 6.	Exhibits.	34


	September 30, 2023		December 31,
	(unaudited)		2022
ASSETS
Current Assets:
Cash	$	2,351,814	$	50,858
Prepaid expenses		2,500		227,594
Total Current Assets		2,354,314		278,452
Non-Current Assets:
Marketable securities held in Trust Account		44,122,831		237,984,513
Total Non-current Assets		44,122,831		237,984,513
TOTAL ASSETS	$	46,477,145	$	238,262,965

LIABILITIES, COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accrued expenses	$	2,148,668	$	681,395
Accounts payable		216,121		97,987
Accrued offering costs		184,047		184,047
Due to related party		287,889		244,550
Excise tax liability		1,976,947		—
Total Current Liabilities		4,813,672		1,207,979
Non-current liabilities:
Warrant liability		1,253,000		527,050
Total Non-current Liabilities		1,253,000		527,050
TOTAL LIABILITIES		6,066,672		1,735,029

Commitments and Contingencies (Note 8)

Class A common stock subject to possible redemption; 200,000,000 shares authorized; 4,150,065 and 23,000,000 shares issued and outstanding subject to possible redemption at redemption value as of September 30, 2023 and December 31, 2022, respectively		44,122,831		237,984,513

Stockholders’ Deficit
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding		—		—
Class A common stock, $0.0001 par value; 200,000,000 shares authorized; 4,200,000 issued and outstanding (excluding 4,150,065 shares subject to possible redemption) as of September 30, 2023 and none issued and outstanding (excluding 23,000,000 shares subject to possible redemption) as of December 31, 2022		420		—
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 1,550,000 and 5,750,000 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively		155		575
Additional paid-in capital		335,986		—
Accumulated deficit		(4,048,919)		(1,457,152)
Total Stockholders’ Deficit		(3,712,358)		(1,456,577)
TOTAL LIABILITIES, COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT	$	46,477,145	$	238,262,965


	For the Three Months				For the Nine Months
	Ended				Ended
	September 30,				September 30,
	2023		2022		2023		2022
Operating costs:
Insurance expense	$	—	$	129,063	$	227,594	$	387,189
Administrative expense		7,845		25,895		128,248		101,395
Legal and accounting expenses		56,330		82,705		211,771		429,833
Franchise tax expense		50,411		50,411		149,589		149,589
Listing fees		21,250		63,750		63,750		153,874
Bank fees		1,927		685		5,726		1,864
Total expenses		137,763		352,509		786,678		1,223,744
Loss from operations		(137,763)		(352,509)		(786,678)		(1,223,744)

Other income (loss):
Change in fair value of warrant liability		(325,000)		593,000		(725,950)		14,872,000
Financing expense		(135,986)		—		(522,948)		—
Dividend income on marketable securities held in Trust Account		731,196		1,065,967		6,120,704		1,399,231
Other income		270,210		1,658,967		4,871,806		16,271,231
Income before provision for income taxes		132,447		1,306,458		4,085,128		15,047,487
Provision for income taxes		(142,965)		—		(1,253,934)		—
Net (loss) income	$	(10,518)	$	1,306,458		2,831,194		15,047,487

Weighted average shares outstanding of redeemable Class A common stock		4,150,000		23,000,000		15,197,646		23,000,000

Basic and diluted net (loss) income per share, redeemable Class A common stock (see Note 2)	$	(0.15)	$	0.05		0.20		0.54

Weighted average shares outstanding of non-redeemable Class A and Class B common stock		5,750,000		5,750,000		5,750,000		5,750,000

Basic and diluted net income (loss) per share, non-redeemable Class A and Class B common stock (see Note 2)	$	0.11	$	0.01		(0.05)		0.47


	Class A common stock
	Subject to possible									Additional				Total
	Redemption			Class A common stock			Class B common stock			Paid-in		Accumulated		Stockholders’
	Shares		Amount	Shares	Amount		Shares	Amount		Capital		Deficit		Deficit
Balance – January 1, 2023	23,000,000	$	237,984,513	—	$	—	5,750,000	$	575	$	—	$	(1,457,152)	$	(1,456,577)
Remeasurement of Class A common stock subject to possible redemption	—		2,525,300	—		—	—		—		—		(2,525,300)		(2,525,300)
Net income	—		—	—		—	—		—		—		1,184,465		1,184,465
Balance – March 31, 2023	23,000,000		240,509,813	—		—	5,750,000		575		—		(2,797,987)		(2,797,412)
Sponsor conversion of Class B common stock	—		—	4,200,000		420	(4,200,000)		(420)		—		—		—
Sponsor capital contribution for non-redemption agreements	—		—	—		—	—		—		386,961		—		386,961
Redemption of Class A common stock	(18,849,935)		(197,694,657)	—		—	—		—		—		—		—
Trust Account withdrawal for tax payments	—		(460,000)	—		—	—		—		—		460,000		460,000
Remeasurement of Class A common stock subject to possible redemption	—		2,864,208	—		—	—		—		(386,961)		(2,477,247)		(2,864,208)
Net income	—		—	—		—	—		—		—		1,657,247		1,657,247
Balance – June 30, 2023	4,150,065		45,219,364	4,200,000		420	1,550,000		155		—		(3,157,987)		(3,157,412)
Excise tax liability	—		—	—		—	—		—		—		(1,976,947)		(1,976,947)
Sponsor cash capital contribution	—		—	—		—	—		—		200,000		—		200,000
Sponsor capital contribution for non-redemption agreements	—		—	—		—	—		—		135,986		—		135,986
Trust Account withdrawal for tax payments	—		(1,827,729)	—		—	—		—		—		1,827,729		1,827,729
Remeasurement of Class A common stock subject to possible redemption	—		731,196	—		—	—		—		—		(731,196)		(731,196)
Net loss	—		—	—		—	—		—		—		(10,518)		(10,518)
Balance – September 30, 2023	4,150,065	$	44,122,831	4,200,000	$	420	1,550,000	$	155	$	335,986	$	(4,048,919)	$	(3,712,358)


Gross proceeds from initial public offering	$	230,000,000
Less:
Proceeds allocated to public warrants		(10,060,000)
Offering costs allocated to Class A common stock subject to possible redemption		(13,325,704)
Add:
Remeasurement of Class A common stock subject to possible redemption		27,986,394
Class A common stock subject to possible redemption, December 31, 2021		234,600,690
Remeasurement of Class A common stock subject to possible redemption		3,383,823
Class A common stock subject to possible redemption, December 31, 2022		237,984,513
Remeasurement of Class A common stock subject to possible redemption		2,525,300
Class A common stock subject to possible redemption, March 31, 2023		240,509,813
Share redemptions payable		(197,694,657)
Trust Account withdrawal for tax payments		(460,000)
Remeasurement of Class A common stock subject to possible redemption		2,864,208
Class A common stock subject to possible redemption, June 30, 2023		45,219,364
Trust Account withdrawal for tax payments		(1,827,729)
Remeasurement of Class A common stock subject to possible redemption		731,196
Class A common stock subject to possible redemption, September 30, 2023	$	44,122,831


	For the Three Months Ended
	September 30, 2023
Net loss	$	(10,518)
Plus: Trust Account withdrawals for tax payments		1,827,729
Less: Remeasurement of Class A redeemable shares to redemption value		(731,196)
Net income excluding accretion of Class A redeemable shares to redemption value from remeasurement and Trust Account withdrawals for tax payments	$	1,086,015


	For the Three Months Ended
	September 30, 2023
	Class A			Class A and Class B
	Redeemable Shares			Non-redeemable shares			Total
Total number of shares		4,150,065			5,750,000			9,900,065
Weighted average shares ratio		42	%		58	%		100	%

Net income allocated based on weighted average shares ratio	$	(4,409)		$	(6,109)		$	(10,518)

Plus: Trust Account withdrawals for tax payments based on weighted average shares ratio		766,176			1,061,553			1,827,729

Less: Remeasurement of Class A redeemable shares to redemption value based on weighted average shares ratio		(306,514)			(424,682)			(731,196)
Less: Accretion applicable to Trust Account withdrawals for tax payments		(1,827,729)			—			(1,827,729)
Plus: Accretion applicable to remeasurement of Class A redeemable shares to redemption value		731,196			—			731,196
Total (loss) income based on weighted average shares ratio	$	(641,280)		$	630,762		$	(10,518)

Weighted average shares outstanding		11,360,423			5,750,000
Basic and diluted net (loss) income per share	$	(0.15)		$	0.11


	For the Nine Months Ended
	September 30, 2023
Net income	$	2,831,194
Plus: Trust Account withdrawals for tax payments		2,287,729
Less: Remeasurement of Class A redeemable shares to redemption value		(6,120,704)
Net income excluding accretion of Class A redeemable shares to redemption value from remeasurement and Trust Account withdrawals for tax payments	$	(1,001,781)


	For the Three
	Months Ended
	September 30, 2022
Net income	$	1,306,458
Less: Remeasurement of Class A redeemable shares to redemption value		(1,065,967)
Net income excluding accretion of Class A redeemable shares to redemption value	$	240,491


	For the Three Months Ended
	September 30, 2022
	Class A Redeemable Shares			Class A and Class B Non-redeemable shares			Total
Total number of shares		23,000,000			5,750,000			28,750,000
Ownership percentage		80	%		20	%		100	%

Net income allocated based on ownership percentage		1,045,166			261,292			1,306,458

Less: Accretion allocation based on ownership percentage		(852,774)			(213,193)			(1,065,967)
Plus: Accretion applicable to remeasurement of Class A redeemable shares to redemption value		1,065,967			—			1,065,967
Total income based on ownership percentage	$	1,258,359		$	48,099		$	1,306,458

Weighted average shares outstanding		23,000,000			5,750,000
Basic and diluted net income per share	$	0.05		$	0.01


	For the Nine
	Months Ended
	September 30, 2022
Net income	$	15,047,487
Less: Remeasurement of Class A redeemable shares to redemption value		(1,399,231)
Net income excluding accretion of Class A redeemable shares to redemption value	$	13,648,256


	September 30, 2023
	(Level 1)		(Level 2)		(Level 3)
Assets:
Marketable securities held in trust account	$	44,122,831	$	—	$	—
Liabilities:
Public Warrants	$	621,000	$	—	$	—
Private Placement Warrants	$	—	$	632,000	$	—



	September 30,
Inputs:	2023			2022
Common stock price	$	10.56		$	9.63
Exercise price	$	11.50		$	11.50
Risk-free rate of interest		4.55	%		1.35	%
Volatility		0.00	%		13.24	%
Term		5.25			6.00
Warrant to buy one share	$	0.05		$	0.74
Dividend yield		0.00	%		0.00	%


	June 9,			September 30,
Inputs:	2023			2023
Common stock price	$	10.54		$	10.56
Estimated probability of an Initial Business Combination		10.00	%		10.00	%
Estimated volatility		76.56	%		65.96	%
Risk-free rate		5.10	%		5.39	%
Time to expiration		1.00			1.00


Exhibit No.		Description
31.1*		Certification of the Principal Executive Officer (and Principal Financial Officer) Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**		Certification of the Principal Executive Officer (and Principal Financial Officer) Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*		XBRL Instance Document
101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document
101.SCH*		XBRL Taxonomy Extension Schema Document
101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)


	December 31, 2022
	(Level 1)		(Level 2)		(Level 3)
Assets:
Marketable securities held in trust account	$	237,984,513	$	—	$	—
Liabilities:
Public Warrants	$	261,050	$	—	$	—
Private Placement Warrants	$	—	$	266,000	$	—


	For the Three and Nine Months Ended September 30, 2023
			Private				Share
	Public		Placement		Warrant		Redemptions
	Warrants		Warrants		Liability		Payable
Derivative warrant liabilities as of December 31, 2022	$	261,050	$	266,000	$	527,050	$	—
Change in fair value		269,100		273,000		542,100		—
Derivative warrant liabilities as of March 31, 2023		530,150		539,000		1,069,150		—
Establishment of share repurchase liability		—		—		—		197,694,657
Change in fair value		(70,150)		(71,000)		(141,150)		—
Derivative warrant liabilities as of June 30, 2023		460,000		468,000		928,000		197,694,657
Share repurchase payment		—		—		—		(197,694,657)
Change in fair value		161,000		164,000		325,000		—
Derivative warrant liabilities as of September 30, 2023	$	621,000	$	632,000	$	1,253,000	$	—


November 13, 2023	Southport Acquisition Corporation

	By:	/s/ Jeb Spencer
		Name: Jeb Spencer
		Title: Chief Executive Officer (and Principal Financial Officer)

Date: November 13, 2023	By:	/s/ Jeb Spencer
		Jeb Spencer
		Chief Executive Officer
		(Principal Executive Officer and Principal Financial Officer)