Marblegate Acquisition (GATE) - 2022 Q1 - Quarterly Report

Part I. Financial Information This part covers the company's financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures Financial Statements This section presents the unaudited condensed financial statements for Marblegate Acquisition Corp. as of March 31, 2022, including balance sheets, statements of operations, changes in stockholders' deficit, and cash flows, along with notes detailing the company's formation, IPO, accounting policies, and going concern uncertainty Condensed Balance Sheets As of March 31, 2022, the company had total assets of $302.3 million, primarily consisting of $301.6 million in marketable securities held in the Trust Account, with total liabilities of $15.5 million including a $15 million deferred underwriting fee, resulting in a total stockholders' deficit of $14.8 million Condensed Balance Sheet Data (as of March 31, 2022 vs. December 31, 2021) | Account | March 31, 2022 (Unaudited) | December 31, 2021 (Audited) | | :--- | :--- | :--- | | Assets | | | | Cash | $170,754 | $380,160 | | Marketable securities held in Trust Account | $301,570,196 | $301,518,928 | | Total Assets | $302,279,362 | $302,481,269 | | Liabilities & Stockholders' Deficit | | | | Total Current Liabilities | $345,693 | $347,450 | | Deferred underwriting fee payable | $15,000,000 | $15,000,000 | | Total Liabilities | $15,541,343 | $15,597,700 | | Class A common stock subject to possible redemption | $301,500,000 | $301,500,000 | | Total Stockholders' Deficit | ($14,761,981) | ($14,616,431) | Condensed Statements of Operations For the three months ended March 31, 2022, the company reported a net loss of $145,550, primarily due to $251,418 in operating and formation costs, partially offset by $54,384 in interest income and a $54,600 positive change in warrant liabilities, with no comparable operations in 2021 Statement of Operations (Three Months Ended March 31) | Item | 2022 | 2021 | | :--- | :--- | :--- | | Operating and formation costs | $251,418 | $— | | Loss from operations | ($251,418) | $— | | Interest income on marketable securities | $54,384 | $— | | Change in fair value of warrant liabilities | $54,600 | $— | | Net loss | ($145,550) | $— | | Basic and diluted net loss per share | ($0.00) | $— | Condensed Statements of Changes in Stockholders' Deficit The company's total stockholders' deficit increased from $(14,616,431) at December 31, 2021, to $(14,761,981) at March 31, 2022, entirely due to the net loss of $145,550 incurred during the period - The total stockholders' deficit increased by $145,550 during the three months ended March 31, 2022, which directly corresponds to the net loss for the period[17] Condensed Statements of Cash Flows For the three months ended March 31, 2022, net cash used in operating activities was $209,406, with no financing or investing activities outside the Trust Account, leading to a decrease in the company's cash balance from $380,160 to $170,754 Cash Flow Summary (Three Months Ended March 31) | Cash Flow Item | 2022 | 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($209,406) | ($525) | | Net cash provided by financing activities | $— | $526 | | Net Change in Cash | ($209,406) | $1 | | Cash – Beginning of period | $380,160 | $— | | Cash – End of period | $170,754 | $1 | Notes to Condensed Financial Statements (Unaudited) The notes clarify the company's status as a blank check company, detailing its IPO, the $301.5 million placed in a trust account, and the substantial doubt about its ability to continue as a going concern without completing a business combination by January 5, 2023, also covering accounting policies, related party transactions, and a $15 million deferred underwriting fee - The Company is a blank check company formed to effectuate a business combination and had not commenced any operations as of March 31, 2022[25][27] - The company has until January 5, 2023 (the "Combination Period") to complete a Business Combination, or it will be required to cease operations and liquidate the Trust Account[38] - Management has concluded that there is substantial doubt about the Company's ability to continue as a going concern through its liquidation date of January 5, 2023, due to the need to complete a business combination and potential need for additional financing[48] - The Sponsor has committed to provide up to $600,000 to fund cash shortfalls for working capital needs[47][92] - The underwriters are entitled to a deferred fee of $15,000,000, payable in cash from the Trust Account upon the closing of a Business Combination[95] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's status as a blank check entity with no current operations or revenue, attributing the Q1 2022 net loss of $145,550 to operating costs offset by interest income and warrant liability changes, while highlighting liquidity and the substantial doubt about its going concern ability without a business combination by January 5, 2023, despite the Sponsor's $600,000 working capital commitment - The company's activities to date have been limited to organizational tasks, preparing for the IPO, and searching for a business combination target[124] - For the three months ended March 31, 2022, the net loss was $145,550, resulting from operating costs of $251,418, offset by interest income of $54,384 and a $54,600 gain on the fair value of warrant liabilities[125] - As of March 31, 2022, the company had $170,754 in cash and $301,570,196 in marketable securities held in the trust account[131][133] - Conditions raise substantial doubt about the Company's ability to continue as a going concern through its liquidation date of January 5, 2023. The Sponsor has agreed to fund cash shortfalls up to $600,000 to support operations[135] - The company has a contractual obligation to pay its Sponsor $10,000 per month for administrative support until a business combination or liquidation[137] Quantitative and Qualitative Disclosures Regarding Market Risk This section is not applicable as the company is a smaller reporting company and is therefore not required to provide these disclosures - Disclosure is not required for smaller reporting companies[145] Controls and Procedures Management, including the principal executive and financial officers, concluded that as of March 31, 2022, the company's disclosure controls and procedures were effective in ensuring timely recording, processing, and reporting of information required for SEC reports - Based on an evaluation as of March 31, 2022, the company's Certifying Officers concluded that disclosure controls and procedures were effective[147] Part II. Other Information This part details legal proceedings, risk factors, equity sales, defaults, mine safety, other information, and exhibits Legal Proceedings The company reports that there are no legal proceedings - The company has no legal proceedings to report[151] Risk Factors This section highlights no material changes to previously disclosed risk factors, except for a new risk concerning potential changes in laws or regulations, specifically citing the SEC's proposed rules for SPACs issued on March 30, 2022, which could increase the costs and time required to complete a business combination - A new risk factor has been identified concerning proposed SEC rules from March 30, 2022, relating to SPACs. These rules, if adopted, could increase costs and time needed to complete an initial business combination[153] Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities or use of proceeds during the period - None reported[154] Defaults Upon Senior Securities The company reports no defaults upon senior securities - None reported[155] Mine Safety Disclosures The company reports no mine safety disclosures - None reported[155] Other Information The company reports no other information - None reported[156] Exhibits This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including certifications from the Principal Executive Officer and Principal Financial Officer as required by the Sarbanes-Oxley Act of 2002, and Inline XBRL documents - Exhibits filed include Certifications of the Principal Executive Officer and Principal Financial Officer pursuant to Sarbanes-Oxley Act Sections 302 and 906, and various Inline XBRL documents[157]