Business Combination and Expansion Plans - The company is pursuing a business combination with Bitcoin Depot, which has consistent profit margins and expansion plans to significantly increase revenue and profit [24]. - Bitcoin Depot plans to expand its ATM locations and enter new agreements with retailers, as well as expand internationally and acquire competitors [24]. - The expected valuation of Bitcoin Depot indicates attractive discounts compared to comparable public market companies [24]. - The business combination is expected to utilize a significant portion of the funds for ongoing expansion plans [24]. - The company has conducted extensive due diligence on Bitcoin Depot, including meetings with management and financial reviews [37]. - The management team has extensive industry experience and a proven track record of operating and expanding networks across the U.S. and Canada [24]. - The business combination is supported by a fairness opinion from Ladenburg, indicating the consideration to be paid is fair to shareholders [24]. Financial Position and Redemption Rights - Public stockholders may redeem their shares for a pro rata share of the trust account, which is subject to taxes due but not yet paid [43]. - If the initial business combination is not completed within the prescribed time period, the company will redeem public shares at a per-share price based on the trust account balance [50]. - The company expects to fund costs associated with dissolution from approximately $2,750,000 held outside the trust account, but cannot assure sufficient funds for all expenses [52]. - The redemption amount for public stockholders may be less than the initial offering price of $10.00 per share due to potential claims from creditors [53]. - The company will only consummate the initial business combination if net tangible assets are at least $5,000,001 immediately prior to or upon consummation [59]. - GSRM's stockholders may redeem their shares for a pro rata portion of the Trust Account, calculated as of two business days before the Special Meeting [82]. - If GSRM stockholders exercise their redemption rights, the working capital available to Bitcoin Depot after the Business Combination will be reduced, potentially affecting its future operations [80]. - The maximum redemption of GSRM Common Stock could result in up to 1,976,562 GSRM Rights being retained by redeeming holders, with an aggregate market value of $3,063,671 [83]. Competition and Market Conditions - The company faces intense competition from other entities with similar business objectives, which may limit its ability to acquire larger target businesses [61]. - The competition for attractive business combination targets is increasing, potentially raising costs and complicating the acquisition process [89]. - Economic uncertainty and geopolitical tensions, particularly due to the conflict between Russia and Ukraine, may adversely affect the company's search for business combinations [96]. - Military conflicts, such as the one in Ukraine, may also contribute to increased price volatility and economic uncertainty, hindering the identification of suitable business combination targets [105]. Regulatory and Compliance Issues - The company has established robust compliance procedures, including KYC and AML programs, to ensure regulatory adherence [24]. - The company is subject to laws and regulations that may change, which could adversely affect its business and results of operations [144]. - The company may incur increased legal and financial compliance costs due to the requirements of being a public company, which could divert management's attention from revenue-generating activities [113]. - Conflicts of interest may arise as the company's officers and directors have pre-existing obligations to other entities, potentially affecting the selection of business combination targets [116]. Financial Performance and Projections - For the year ended December 31, 2022, the company reported a net loss of approximately $1.7 million, consisting of approximately $5.1 million in general and administrative expenses, approximately $200,000 in franchise tax expense, and approximately $891,000 in income tax expenses, partially offset by an increase of approximately $4.4 million in the value of investments held in the Trust Account [185]. - As of December 31, 2022, the company had approximately $477,000 in cash and a working capital deficit of approximately $3.4 million, including tax obligations of approximately $1.1 million [176]. - GSRM may need to raise additional funds to meet acquisition costs and operational expenditures, potentially requiring the issuance of additional securities or incurring debt [143]. - GSRM's independent registered public accounting firm expressed substantial doubt about the company's ability to continue as a going concern due to its limited operating history [140]. IPO and Capital Structure - The Initial Public Offering (IPO) generated gross proceeds of approximately $316.3 million from the sale of 31,625,000 units at $10.00 per unit, with offering costs of about $4.7 million [168]. - Approximately $321.0 million ($10.15 per unit) of net proceeds from the IPO and private placement was placed in a trust account, invested in U.S. government securities [170]. - The company has 15 months from the closing of the IPO, or until June 1, 2023, to complete its initial business combination, with the possibility of extending this period by up to three additional months [172]. - The company issued rights convertible into up to 1,976,562 shares of Class A Common Stock and 12,223,750 private placement warrants, which could dilute the value of existing shares upon exercise [119]. Internal Controls and Reporting - The company conducted an evaluation of its disclosure controls and procedures as of December 31, 2022, concluding that they were effective [212]. - There were no changes to the internal control over financial reporting during the fiscal quarter ended December 31, 2022, that materially affected the reporting [214]. - The management's report does not include an assessment of internal control over financial reporting due to a transition period for newly public companies [213]. - The company has classified all 31,625,000 shares of Class A common stock sold in the Initial Public Offering as redeemable, impacting its financial reporting [198].
GSR II METEORA A(GSRM) - 2022 Q4 - Annual Report