IPO and Initial Financing - The company closed its initial public offering on January 13, 2022, selling 10,000,000 units at $10.00 per unit, generating gross proceeds of $100,000,000[11]. - A private sale of 446,358 units was completed simultaneously with the IPO, generating gross proceeds of $4,463,580[12]. - The underwriters partially exercised the over-allotment option, purchasing an additional 159,069 units for gross proceeds of $1,590,690[12]. - The trust account established for public stockholders has been maintained by Continental Stock Transfer & Trust Company[13]. - The company has approximately $19 million available for an initial business combination as of February 25, 2024[60]. - The net proceeds from the initial public offering have been invested in U.S. government treasury bills or money market funds, minimizing exposure to interest rate risk[175]. Business Combination and Mergers - The Openmarkets Merger Agreement was entered into on January 18, 2023, with amendments made on August 1, 2023, and January 9, 2024, to adjust the number of shares and extend deadlines[16][18]. - The number of Purchaser Shares to be issued as consideration at the Closing was decreased from 9,000,000 to 7,000,000 due to an updated valuation of the Target[18]. - The company is required to liquidate and transfer all assets and liabilities to the Purchaser following the Redomestication Merger[18]. - The company aims to list on any tier of the Nasdaq exchange by the time of the Closing[18]. - The number of Purchaser Shares to be issued to the Seller at Closing is decreased from 7,000,000 to 4,800,000 due to an updated valuation of the Target[19]. - The number of Purchaser Shares related to the Earnout is increased from 2,000,000 to 2,700,000 based on the updated valuation of the Target[19]. - The Target must have at least $7,000,000 in cash or cash equivalents upon Closing[23]. - The Purchaser must have at least $5,000,001 in tangible net assets at Closing[23]. - A breakup fee of $5,000,000 is required from the Target if the BCA is terminated under specific conditions[26]. - The Escrow Agreement will hold 1,607,000 Purchaser Shares for indemnification obligations and 2,000,000 Purchaser Shares for the Earnout[30]. - The company aims to capture opportunities in high growth markets such as North America and Asia Pacific[37]. - The company employs a proactive acquisition strategy, as demonstrated by the Openmarkets Merger[42]. - The investment strategy focuses on businesses in AI, machine learning, and aviation with positive growth drivers and measurable ESG impact[43]. - The acquisition selection criteria include targeting companies with strong management teams, attractive business models, and significant growth potential[49]. - The company intends to leverage its management team's operational experience and extensive networks to identify and evaluate acquisition opportunities[46]. - The company will conduct comprehensive due diligence, including financial analysis and technology assessments, before finalizing any business combination[52]. - The company aims to create long-term value for stockholders by identifying businesses at an inflection point that would benefit from additional management expertise[49]. - The company will not pursue business combinations with entities in China, Hong Kong, or Macau[44]. - The company believes that the pandemic has changed consumer behavior, creating numerous opportunities for business combinations[48]. - The company may seek additional funding through private offerings to facilitate its initial business combination[63]. Redemption and Stockholder Rights - Public stockholders will have the opportunity to redeem their shares at a price equal to the amount in the trust account upon consummation of the initial business combination[83]. - The company will conduct redemptions either through a general meeting or a tender offer, depending on whether stockholder approval is sought[84]. - The company has agreed to waive redemption rights for initial stockholders if the initial business combination is not completed within the required period[83]. - The company will not redeem public shares if it would cause net tangible assets to fall below $5,000,001 prior to the business combination[87]. - Public stockholders may redeem shares, but those holding more than 15% of shares sold in the offering are restricted from seeking redemption rights without prior consent[96]. - The company will have up to twelve one-month extensions to complete its business combination until January 13, 2025, with a deposit of $0.035 per share for each month by the sponsor[102]. - If the initial business combination is not completed by the deadline, public shares will be redeemed at a per-share price based on the trust account balance[102]. - The expected per-share redemption amount upon dissolution is approximately $10.10, but actual amounts may be lower due to creditor claims[108]. - The company’s sponsor and management have waived their rights to liquidating distributions from the trust account for insider shares if the business combination is not completed[104]. - Redemption rights must be exercised by tendering shares before the vote on the initial business combination[97]. - The company intends to fund dissolution costs from approximately $392,000 held outside the trust account plus up to $100,000 from interest on the trust account[106]. - The company has access to approximately $392,000 from the proceeds of the offering to cover potential claims, with estimated liquidation costs not exceeding $25,000[114]. - As of December 31, 2023, the company has $15,282 held outside the trust account to address potential claims, with estimated liquidation costs around $100,000[115]. - The company aims to ensure that the trust account does not fall below $10.10 per public share due to creditor claims, with the sponsor liable for any shortfall[110]. - If the trust account proceeds drop below $10.10 per public share, independent directors may consider legal action against the sponsor to enforce indemnification obligations[112]. - The company is required to adopt a plan to address all existing and potential claims for up to ten years, given its status as a blank check company[119]. - The company will seek waivers from all vendors and service providers regarding claims to the trust account to limit potential liabilities[114]. - Stockholders may be liable for claims against the corporation to the extent of distributions received during dissolution[116]. - The company will provide audited financial statements of the target business to stockholders as part of the tender offer materials[126]. Regulatory Compliance and Financial Reporting - The company is required to evaluate its internal control procedures for the fiscal year ended December 31, 2023, as mandated by the Sarbanes-Oxley Act[127]. - The company has filed a Registration Statement on Form 8-A with the SEC, becoming subject to the Exchange Act rules and regulations[128]. - The company qualifies as an "emerging growth company," allowing it to take advantage of certain exemptions from reporting requirements, potentially affecting the attractiveness of its securities[129]. - The company intends to utilize the extended transition period for complying with new accounting standards, delaying adoption until they apply to private companies[130]. - The company will remain an "emerging growth company" until the earlier of January 13, 2027, achieving total annual gross revenue of at least $1.07 billion, or exceeding a market value of $700 million[131]. - As of December 31, 2023, the company has not generated any revenues and has engaged in limited operations since its inception on April 16, 2021[174].
Broad Capital Acquisition Corp(BRACU) - 2023 Q4 - Annual Report