Workflow
Burtech Acquisition Corp.(BRKHU) - 2024 Q2 - Quarterly Report

IPO and Business Combination - The Company completed its IPO on December 15, 2021, raising approximately $287.5 million from the sale of 28,750,000 units at $10.00 per unit [145]. - Following a stockholder vote on March 10, 2023, approximately $227.8 million was redeemed, resulting in 6,630,703 shares of Class A common stock outstanding [146]. - During the Second Special Meeting on December 11, 2023, stockholders redeemed 2,285,040 shares, leading to approximately $24.5 million being removed from the trust account [147]. - The Company has the right to extend the time to complete a business combination up to twelve times, each for an additional one-month period, until December 15, 2024 [150]. - On December 22, 2023, the Company entered into a Merger Agreement with Blaize, Inc., which will result in Blaize becoming a wholly owned subsidiary of the Company [152]. - The Merger Agreement includes provisions for the issuance of up to 6,833,333 shares of Class A common stock to Blaize for aggregate gross proceeds of $25.0 million [153]. - An additional 16.3 million shares of New Blaize common stock may be issued as earnout shares based on stock price performance over a five-year period [157]. - The closing of the Merger is subject to various conditions, including shareholder approval and regulatory clearances [159]. - The Company will be renamed "Blaize Holdings, Inc." following the completion of the Merger [152]. - The Company has approximately $68.0 million remaining in its trust account after redemptions [146]. - The aggregate gross proceeds from the merger transaction are expected to be equal to or greater than $125,000,000 [163]. - The Company and Blaize have agreed to use commercially reasonable efforts to conduct their businesses in the ordinary course through the Closing [164]. - The Company has agreed to cease any existing discussions regarding other Business Combination Proposals during the merger process [167]. - The Company will file a registration statement on Form S-4 to obtain shareholder approval for the Business Combination [164]. - The Lock-up Agreements will restrict the transfer of New Blaize common stock for 180 days after the Closing [175]. Financial Performance and Position - For the three months ended June 30, 2024, the company reported a net loss of $600,213, with operating costs and franchise taxes amounting to $748,339 [183]. - For the six months ended June 30, 2024, the company had a net loss of $610,846, offset by interest from investments held in the Trust Account of $1,253,990 [184]. - As of June 30, 2024, the company had $48,885,820 in investments held in trust and $26,944 in its restricted cash account [187]. - The company had $1,500,000 outstanding under a Convertible Promissory Note and $1,059,551 in advances from the sponsor as of June 30, 2024 [188]. - The company is less than 7 months from its mandatory liquidation, raising substantial doubt about its ability to continue as a going concern [190]. - The company has no long-term debt or capital lease obligations, with only a monthly fee of $10,000 for office space and administrative support [193]. Tax and Regulatory Considerations - The company may be subject to a 1% excise tax on stock repurchases occurring on or after January 1, 2023, as per the Inflation Reduction Act of 2022 [219]. - The company may be subject to an excise tax on redemptions or repurchases occurring after December 31, 2023, depending on various factors including fair market value and business combination structure [220]. - The excise tax implications could reduce the cash available for completing business combinations, affecting the company's ability to finalize such transactions [220]. - Recent interim guidance from the IRS indicates that the excise tax should not apply in the event of the company's liquidation, subject to certain exceptions [220]. Internal Controls and Reporting - The company has identified material weaknesses in its internal control over financial reporting, which may affect its ability to accurately report financial results [213].