MAQUIA CAPITAL ACQUISITION CORPORATION ANNOUNCES SPONSOR MONTHLY CONTRIBUTION OF 2.5% ADDITIONAL FOUNDER SHARES FOR EXTENSION AMENDMENT

Rhea-AI Summary

Maquia Capital Acquisition Corporation (MAQCU) announced a negotiation with unaffiliated third parties for a non-redemption agreement in connection with an extension of time for the Company to consummate an initial business combination. The agreement is expected to increase the amount of funds that remain in the Company’s trust account following the Special Meeting.

Insights

Financial Analyst

The negotiation of a non-redemption agreement by Maquia Capital Acquisition Corporation with third parties is a strategic move designed to stabilize the company's trust account balance during the period leading up to a potential extension of the deadline for an initial business combination. This agreement, which incentivizes shareholders not to redeem their shares by offering additional equity, could be viewed as a method to retain capital within the company. The potential benefits for the company include maintaining a more robust balance sheet, which can be appealing to potential business combination targets. However, the dilutive effect of transferring additional stock to non-redeeming shareholders could be a concern for existing shareholders as it might reduce their proportional ownership.

Moreover, the company's decision to potentially extend the deadline to August 2024 indicates that they have not yet identified a suitable business combination target within the original timeframe. This can be interpreted as a sign of a challenging market environment or high selectiveness on the part of Maquia's management. The market's reaction to this news will likely hinge on investor confidence in the company's ability to ultimately find a valuable merger or acquisition target. If the extension is not approved, the company's commitment to liquidate and dissolve could lead to a loss of investor capital, which adds a layer of risk to the investment.

Legal Expert

The legal implications of the non-redemption agreement and the proposed extension of the deadline for an initial business combination are noteworthy. The non-redemption agreement is a legal contract that binds the third-party shareholders to hold their shares until the special meeting, with the incentive of receiving additional shares if they comply. This type of agreement is not standard practice in every special purpose acquisition company (SPAC) transaction and it requires careful scrutiny of the terms outlined in Exhibit 10.1 to ensure compliance with securities law and fairness to all shareholders.

Additionally, the company's ability to extend the deadline for finding a business combination is typically enshrined in the SPAC's charter and subject to shareholder approval. The outcome of the special meeting will be pivotal. If the extension is not approved, the company is bound by its charter to liquidate, which entails a complex legal process of dissolving the company and distributing the remaining assets to shareholders. The legal framework governing these processes is critical to ensure that the rights of all parties involved are protected.

Market Research Analyst

From a market research perspective, the dynamics surrounding Maquia Capital Acquisition Corporation's extension proposal and non-redemption agreement reflect broader trends in the SPAC market. The increasing prevalence of such agreements could signal a shift in how SPACs manage their capital structure and shareholder relations, especially in a market where finding a suitable merger target can be competitive and time-sensitive. The willingness of shareholders to enter into non-redemption agreements may also indicate their belief in the potential value of the eventual business combination, despite the current lack of specifics.

Analyzing the potential impact on the stock market, the non-redemption agreement could provide short-term price stability for Maquia's shares, as it reduces the immediate risk of capital outflow from share redemptions. However, the long-term market perception will largely depend on the success of the eventual business combination and the strategic fit of the acquired company within Maquia's portfolio. Investors and analysts will be closely monitoring the company's progress towards a business combination, as the outcome will have significant implications for the company's valuation and stock performance.

Miami, FL, Jan. 23, 2024 (GLOBE NEWSWIRE) -- Maquia Capital Acquisition Corporation (“Maquia” or the “Company”) (Nasdaq: “MAQC”, “MAQCU”, “MAQCW”) announced today that, in connection with the Company’s upcoming special meeting of the stockholders (the “Special Meeting”) to consider and approve an extension of time for the Company to consummate an initial business combination from February 7, 2024 to August 7, 2024 (the “Extension”), on January 23, 2024, Maquia Investments North America, LLC (the “Sponsor”) or its designees and, Maquia Capital Acquisition Corporation (the “Company”) commenced negotiation with unaffiliated third parties (“Third Parties”) for a non-redemption agreement (“Non-Redemption Agreement”) in which such third parties would agree not to redeem a currently unspecified number shares of the Company’s Class A common stock purchased by such Third Parties in the initial public offering (“Non-Redeemed Shares”) in connection with the special meeting of the stockholders called by the Company (the “Special Meeting”) to consider and approve an extension of time for the Company to consummate an initial business combination (the “Extension Proposal”) from February 7, 2024 to August 7, 2024 (the “Extension”). In exchange for the foregoing commitments not to redeem such Non-Redeemed Shares, the Sponsor has agreed to transfer to such Third Parties  2.5% per month of the Non-Redeemed Shares up to a maximum of 6 months (depending upon the month the initial business combination is consummated), of the Company’s Class A common stock held by such Third Parties, immediately following the consummation of an initial business combination, if the Third Parties continue to hold such Non-Redeemed Shares through the Special Meeting.

The Non-Redemption Agreements are not expected to increase the likelihood that the Extension Proposal is approved by Company’s stockholders but are expected to increase the amount of funds that remain in the Company’s trust account following the Special Meeting.

The foregoing summary of the Non-Redemption Agreement does not purport to be complete and is qualified in its entirety by reference to the form of Non-Redemption Agreement filed herein as Exhibit 10.1 and incorporated herein by reference.

The Non-Redemption Agreements are not expected to increase the likelihood that the Extension Proposal is approved by Company’s stockholders but are expected to increase the amount of funds that remain in the Company’s trust account following the Special Meeting.

Any Contribution is conditioned upon the implementation of the Extension. No Contribution will occur if the Extension is not approved or is not completed. The Company will have the sole discretion whether to continue extending for additional calendar months until August 7, 2024. If the Company opts not to utilize any remaining portion of the Extension Period, then the Company will liquidate and dissolve promptly in accordance with its charter, and its Sponsor’s obligation to make additional contributions will terminate.

About Maquia Capital Acquisition Corporation

Maquia Capital Acquisition Corporation is a blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. The Company is led by Chief Executive Officer, Jeff Ransdell, Chief Financial Officer, Jeronimo Peralta, Chief Operating Officer, Guillermo Cruz, and Chief Investment Officer, Maggie Vo.

Forward-Looking Statements

This press release includes forward-looking statements that involve risks and uncertainties. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from the forward-looking statements. These forward-looking statements and factors that may cause such differences include, without limitation, uncertainties relating to the Company’s stockholder approval of the Extension, its inability to complete an initial business combination within the required time period or, and other risks and uncertainties indicated from time to time in filings with the Securities and Exchange Commission (the “SEC”), including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 under the heading “Risk Factors” and in other reports the Company has filed, or to be filed, with the SEC. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. The Company expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.

Participants in the Solicitation

Maquia and its directors, executive officers, other members of management and employees, under SEC rules, may be deemed to be participants in the solicitation of proxies from the security holders of the Company in favor of the approval of the Extension Proposal. Investors and security holders may obtain more detailed information regarding the names, affiliations and interests of the Company’s directors and officers in the Company’s definitive proxy statement filed with the SEC on January 17, 2024 (as may be amended, the “Proxy Statement”), which may be obtained free of charge from the sources indicated above.

No Offer or Solicitation

This press release s shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Extension. This communication shall also not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act or an exemption therefrom.

Additional Information and Where to Find It

Maquia urges investors, stockholders and other interested persons to read the Proxy Statement as well as other documents filed by the Company with the SEC, because these documents will contain important information about the Company and the Extension. Stockholders may obtain copies of the Proxy Statement, without charge, at the SEC’s website at www.sec.gov or by directing a request to: Advantage Proxy, Inc., P.O. Box 13581, Des Moines, WA 98198, Attn:  Karen Smith.

INVESTOR RELATIONS CONTACT

Guillermo Eduardo Cruz
Maquia Capital Acquisition Corporation
50 Biscayne Boulevard, Suite 2406, Miami, FL 33132
E-mail: guillermo@maquiacapital.com
Telephone: (305) 608-1395

FAQ

What is the purpose of Maquia's upcoming special meeting of the stockholders?

The purpose is to consider and approve an extension of time for the Company to consummate an initial business combination from February 7, 2024 to August 7, 2024.

What is the negotiation with unaffiliated third parties about?

The negotiation is for a non-redemption agreement in which Third Parties would agree not to redeem a currently unspecified number shares of the Company’s Class A common stock purchased by them in connection with the Special Meeting.

What is expected to increase as a result of the Non-Redemption Agreements?

The agreements are expected to increase the amount of funds that remain in the Company’s trust account following the Special Meeting.

What happens if the Company opts not to utilize any remaining portion of the Extension Period?

The Company will liquidate and dissolve promptly in accordance with its charter, and its Sponsor’s obligation to make additional contributions will terminate.