Financial Performance - For the three months ended March 31, 2024, the Company reported a net loss of $9,631,284, primarily due to $860,772 in general and administrative costs and a $9,580,000 loss on the change in fair value of the Forward Purchase Agreement liability[200] - The Forward Purchase Agreement liability was estimated at $27,950,000 as of March 31, 2024, reflecting a loss of $9,580,000 on the change in fair value for the three months ended March 31, 2024[210] - The Company has generated non-operating income of $1,034,171 from dividend and interest income earned in the Trust Account for the three months ended March 31, 2024[200] IPO and Funding - The Initial Public Offering (IPO) generated gross proceeds of $92 million from the sale of 9,200,000 units at $10.00 per unit, with offering costs of approximately $8.7 million[169] - The Company raised an additional $3.04 million from the private placement of 3,040,000 warrants at $1.00 each[172] - The Sponsor sold 600,000 Founder Shares to ten Anchor Investors at the IPO date, generating proceeds of $4,860[225] Business Combination - The Company entered into a Merger Agreement with ConnectM Technology Solutions, Inc., which is expected to be completed through a merger with a wholly owned subsidiary[190] - The Company is required to complete a Business Combination by November 13, 2024, or face potential dissolution[197] - The Company has extended the deadline for consummating its Business Combination to November 13, 2024, with provisions for additional monthly extensions[191] - The Company has conducted multiple extensions of the Business Combination deadline, with the latest extension being to June 13, 2024[187] - The Company has the option to extend the Business Combination deadline by depositing up to $414,000 for each one-month extension, totaling up to $2,484,000 for six extensions[191] Compliance and Regulatory Issues - The Company received a notice of non-compliance with Nasdaq Listing Rule 5450(a)(2) due to having fewer than 400 total holders, with a compliance plan required within 45 days[189] - The Company has identified material weaknesses in internal controls over financial reporting, including issues with the accuracy and completeness of SEC filings and financial data[231] - There have been no changes in internal control over financial reporting that materially affect the Company, aside from those related to remediation efforts[235] Working Capital and Loans - As of March 31, 2024, the Company had $1,119,457 borrowed under the Working Capital Loans from the Sponsor, an increase from $739,457 as of December 31, 2023[227] - The Company has incurred $1,119,457 in Working Capital Loans as of March 31, 2024, which may be converted into warrants at a price of $1.00 per warrant[195] - The Sponsor loaned the Company $380,000 in Working Capital Loans during the three months ended March 31, 2024, to be repaid upon consummation of a Business Combination[227] Liquidity and Cash Position - As of March 31, 2024, the Company had cash in the Trust Account amounting to $80,714,142, intended for completing its initial business combination[196] - As of November 6, 2023, approximately $20,961,169 was redeemed from the Trust Account, leaving approximately $77,333,961 remaining[182] - As of December 31, 2023, the Company reported a working capital deficit of $8,905,721[193] Internal Controls and Remediation - Remediation efforts are ongoing to address identified material weaknesses, including additional review procedures for legal agreements and financial data[233] - The Company plans to implement additional oversight of cash availability for operational needs as part of its internal control improvements[236] - The Company expects to incur expenses related to being a public company, including legal and financial reporting costs, as well as due diligence expenses[194] Operational Status - The Company has not generated any operating revenues to date and does not expect to do so until after the completion of its business combination[194] - The Company incurred $30,000 under the administrative support agreement during the three months ended March 31, 2024, with $93,600 due as of March 31, 2024[204] - The Company has incurred deferred underwriting fees of approximately $3.7 million, payable only if a business combination is completed[169]
Monterey Capital Acquisition (MCAC) - 2024 Q1 - Quarterly Report