Business Combination - The proposed business combination with Lottery.com involves an aggregate consideration of approximately $444 million, calculated as 40,000,000 shares of common stock at $11.00 per share [138]. - Lottery.com shareholders may receive up to 6,000,000 additional shares based on performance metrics related to the stock price, with specific thresholds set at $13.00 and $16.00 per share [139]. Financial Performance - For the year ended December 31, 2020, the company reported a net loss of $809,047, with operating costs totaling $1,385,738 [148]. - Cash used in operating activities for the year ended December 31, 2020, was $1,848,754, influenced by interest earned on marketable securities and changes in operating assets and liabilities [151]. - The company has not engaged in any operations or generated revenues to date, focusing solely on organizational activities and preparing for the Initial Public Offering [146]. Cash and Securities - As of December 31, 2020, the company had marketable securities held in the trust account amounting to $63,405,336, including approximately $1,537,000 of interest income [150]. - The company had cash of $972,787 held outside the trust account as of December 31, 2020, intended for identifying and evaluating target businesses [154]. - The company intends to use substantially all funds in the trust account for acquiring a target business and related expenses, with remaining proceeds for working capital [153]. - The company may need to raise additional capital through loans or investments from initial stockholders, officers, or directors to meet working capital needs [161]. Debt and Obligations - The company has no long-term debt or capital lease obligations, only a monthly fee of $7,500 to VK Consulting for services [163]. - The underwriter is entitled to a deferred fee of 2.5% of the gross proceeds from the Initial Public Offering, amounting to $5,031,250, payable upon the closing of a Business Combination [164]. - A warrant solicitation fee of 5% of the exercise price of each Public Warrant exercised will be paid to the underwriter, with no maximum limit except for the number of Public Warrants outstanding [165]. Stockholder Equity - Stockholders redeemed an aggregate of approximately $137,130,484 (or approximately $10.48 per share) during the Annual Meeting held on November 26, 2019 [142]. - Common stock subject to possible redemption is classified as temporary equity and presented at redemption value outside of stockholders' equity [167]. - Net (loss) income per common share is calculated using the two-class method, with specific calculations for redeemable and non-redeemable common stock [168]. Investment Strategy - The company has invested the net proceeds from the Initial Public Offering in U.S. government treasury bills and money market funds, minimizing exposure to interest rate risk [170].
Lottery(LTRY) - 2020 Q4 - Annual Report