International Media Acquisition (IMAQ) - 2023 Q3 - Quarterly Report

Financial Performance - The company reported a net loss of $524,827 for the three months ended December 31, 2022, compared to a net loss of $530,838 for the same period in 2021[160][161]. - For the nine months ended December 31, 2022, the company had a net loss of $1,048,123, which was lower than the net loss of $1,880,881 for the same period in 2021[162][163]. - The company incurred formation and operating costs of $1,720,979 for the nine months ended December 31, 2022[162]. - Net loss per common share is calculated by dividing net loss by the weighted-average number of shares outstanding, with no consideration for warrants in the diluted income per share calculation[206]. Liquidity and Financial Position - The company has $158,952 in its operating bank account as of December 31, 2022, which is insufficient to operate for the next 12 months without a business combination[164][174]. - The company expects primary liquidity requirements to include approximately $549,000 for accounting, audit, and other third-party expenses related to business combination structuring and negotiation[175]. - The company may need to raise additional funds following the Initial Public Offering to meet operating expenditures, with potential additional financing required for the initial business combination[179]. - The outstanding balance on the promissory notes as of December 31, 2022, was $750,000 for the Post-IPO Promissory Note and $895,000 for the August 2022 Promissory Note[183][184]. Business Combination and Acquisitions - The company entered into a Stock Purchase Agreement to acquire 100% of the issued and outstanding share capital of Reliance Entertainment Studios Private Limited for an aggregate purchase price of $102,000,000[154][155]. - The company also agreed to make a primary investment of $38,000,000 into the target company as part of the acquisition[155]. - The company has until May 2, 2023, to consummate a business combination, with the possibility of extending this deadline further[171]. - If a business combination is not completed by the deadline, the company will face mandatory liquidation and dissolution[172]. - The company plans to use the proceeds from the Initial Public Offering and private placement primarily for the initial business combination and related expenses[170]. Initial Public Offering - The Initial Public Offering generated gross proceeds of $200,000,000 from the sale of 20,000,000 units at $10.00 per unit[165]. - The underwriting agreement for the Initial Public Offering included a cash underwriting discount of $0.20 per Unit sold, totaling $4,600,000, and deferred underwriting commissions of $8,050,000[188]. Consulting and Advisory Services - The company has engaged Ontogeny Capital for management consulting and corporate advisory services, with an agreed payment of $2,875,000 upon the consummation of the initial business combination[191]. - The engagement letter with Ontogeny Capital for PIPE financing includes a contingent fee of 5% of gross proceeds up to $75 million[198]. - The company has entered into various consulting agreements with total fees amounting to significant sums, including $25,000 for Morrow Sodali and $150,000 for Houlihan Capital[200][203]. Compensation and Equity - The company recognized a compensation expense of $786,848 for the sale of 150,000 Founder Shares to independent directors, valued at $787,500[211]. - An additional compensation expense of $141,150 was recognized for the sale of 25,000 Founder Shares to an additional independent director, valued at $141,250[213]. - The company recognized a compensation expense of $423,450 for the sale of 75,000 Founder Shares to an independent consultant, valued at $423,750[214]. - The assessment of warrants as equity or liability is conducted at issuance and quarterly, based on specific terms and guidance[207]. Stock and Market Information - The company has 23,000,000 Public Shares with a redemption feature, classified outside of permanent equity due to SEC guidance[208]. - Changes in redemption value of redeemable common stock are recognized immediately, affecting additional paid-in capital and accumulated deficit[209]. - The company has not disclosed any market risk information as it qualifies as a smaller reporting company[215].