Cautionary Note Regarding Forward-Looking Statements
All statements other than statements of historical fact included in this Report
including, without limitation, statements under this "Management's Discussion
and Analysis of Financial Condition and Results of Operations" regarding the
Company's financial position, business strategy and the plans and objectives of
management for future operations, are forward-looking statements. When used in
this Report, words such as "anticipate," "believe," "estimate," "expect,"
"intend" and similar expressions, as they relate to us or the Company's
management, identify forward-looking statements. Such forward-looking statements
are based on the beliefs of management, as well as assumptions made by, and
information currently available to, the Company's management. Actual results
could differ materially from those contemplated by the forward-looking
statements as a result of certain factors detailed in our filings with the SEC.
All subsequent written or oral forward-looking statements attributable to us or
persons acting on the Company's behalf are qualified in their entirety by this
paragraph.
The following discussion and analysis of the Company's financial condition and
results of operations should be read in conjunction with our audited financial
statements and the notes related thereto which are included in "Item 8.
Financial Statements and Supplementary Data" of this Annual Report on Form 10-K.
Certain information contained in the discussion and analysis set forth below
includes forward-looking statements. Our actual results may differ materially
from those anticipated in these forward-looking statements as a result of many
factors, including those set forth under "Special Note Regarding Forward-Looking
Statements," "Item 1A. Risk Factors" and elsewhere in this Annual Report on Form
10-K.
28
Overview
We are a blank check company formed under the laws of the State of Delaware on
April 16, 2021, for the purpose of effecting a merger, capital stock exchange,
asset acquisition, stock purchase, reorganization or other similar Business
Combination with one or more businesses. We intend to effectuate our Business
Combination using cash from the proceeds of the IPO and the sale of the private
placement, our capital stock, debt or a combination of cash, stock and debt.
All activity through December 31, 2022, relates to our formation and preparation
of our IPO, which closed on January 11, 2022, and our search for an initial
Business Combination. We expect to incur significant costs in the pursuit of our
initial Business Combination. We cannot assure you that our plans to raise
capital or to complete our initial Business Combination will be successful.
In our IPO, we completed the sale of 10,000,000 units that consisted of one
share of common stock, par value $0.000001 per share and one right, with each
right entitling the holder thereof to receive one-tenth (1/10) of a share of
common stock upon consummation of our Business Combination. Simultaneously with
the closing of our IPO, we closed a private placement of an aggregate of 446,358
units at a price of $10.00 per private placement unit, generating total gross
proceeds of $4,463,580. On February 9, 2022, the underwriters partially
exercised the Over-Allotment Option and purchased an additional 159,069 Units
generating $1,590,690, and the Company completed the private sale of 4,772
private units generating $47,720 for a total of $4,511,300 from the placement
units. In connection with the closing and sale of the Over-Allotment Units and
the additional private placement units, $1,606,597 in proceeds from the
Over-Allotment Closing (including $31,814 of the Underwriters' deferred
discount) was placed in a U.S.-based trust account maintained by Continental
Stock Transfer & Trust Company, acting as trustee.
As of December 31, 2022, we had marketable securities held in the Trust account
for the benefit of the Company's public shareholders of $104,162,029 (including
$1,555,432 of interest earned since the IPO). The trust fund account is invested
in interest-bearing U.S. government securities and the income earned on those
investments is also for the benefit of our public shareholders.
Our management has broad discretion with respect to the specific application of
the net proceeds of IPO and the Private Placement, although substantially all of
the net proceeds are intended to be applied generally towards consummating a
business combination.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date.
Our only activities since inception have been organizational activities, those
necessary to prepare for our Initial Public Offering and identifying a target
company for our initial Business Combination. We do not expect to generate any
operating revenues until after completion of our initial Business Combination.
We generate non-operating income in the form of interest income on cash and cash
equivalents held in the Trust Account. We incur expenses as a result of being a
public company (for legal, financial reporting, accounting and auditing
compliance), as well as expenses as we conduct due diligence on prospective
Business Combination candidates.
For the year ended December 31, 2022, we had a net loss of $433,615 consisting
of formation and operating costs of $1,508,247 and franchise tax of $195,138 and
income tax of $285,662 offset by interest earned on marketable securities held
in Trust of $1,555,432.
For the year ended December 31, 2021, we had a net loss of $20,095 consisting of
formation and operating costs of $20,095.
Recent Developments
As previously reported by the Company on its Current Report on Form 8-K filed on
January 24, 2023, on January 18, 2023, the Company entered into a definitive
Agreement and Plan of Merger and Business Combination Agreement (the
"Openmarkets Merger Agreement" or "BCA") with Openmarkets Group Pty Ltd, an
Australian proprietary limited company (the "Target"), BMYG OMG Pty Ltd, an
Australian proprietary limited company and Broad Capital LLC, solely in its
capacity as the Company's sponsor.
29
Pursuant to the Openmarkets Merger Agreement, prior to the closing (the
"Closing") of the contemplated transactions (collectively, the "Business
Combination"), the Parties will cause the Company to move its domicile from the
State of Delaware to Australia by merging a to-be-formed Delaware corporation
("Merger Sub"), which shall be wholly-owned by a to-be-formed Australian
corporation (the "Purchaser") with and into the Company, with the Company
continuing as the surviving entity and a wholly-owned subsidiary of the
Purchaser (the "Redomestication Merger").
As a result of the Redomestication Merger, (i) each issued and outstanding share
of the Company's common stock, par value $0.000001 per share (the "Company
Common Stock"), will convert into the right to receive one ordinary share of the
Purchaser (the "Purchaser Shares"); (ii) each of the Company's units (the
"Company Units"), comprised of one share of Company Common Stock and one right
to receive one-tenth of one share of Company Common Stock upon the Closing (each
a "Company Right"), shall convert into the right to receive one unit of the
Purchaser, comprised of one Purchaser Share and one right to receive one-tenth
of one Purchaser Share upon the Closing (each a "Purchaser Right"); and (iii)
each Company Right shall be converted into the right to receive one Purchaser
Right. For more information on the Openmarkets Merger and the Openmarkets Merger
Agreement, see "Item 1. Business" and please refer to our Current Report on Form
8-K, filed with the SEC on January 18, 2023.
Liquidity and Capital Resources
As of December 31, 2022, the Company had $391,924 of cash in its operating bank
account.
The Company's liquidity needs prior to the consummation of the Initial Public
Offering were satisfied through the payment of $25,000 from the Sponsor to cover
for certain offering costs on the Company's behalf in exchange for issuance of
the insider shares (as defined in Note 4). Following the Initial Public Offering
of the Company on January 13, 2022, a total of $133,533 under the promissory
note was repaid on January 19, 2022, and the Company's liquidity has been
satisfied through the net proceeds from the consummation of the Initial Public
Offering and the Private Placement held outside of the Trust Account. In
addition, to finance transaction costs in connection with a Business
Combination, the Sponsor or an affiliate of the Sponsor, or certain of the
Company's officers and directors may, but are not obligated to, provide the
Company Working Capital Loans (as defined in Note 4). As of December 31, 2022,
there were no amounts outstanding under any Working Capital Loan.
Based on the foregoing, management believes that the Company will have
sufficient working capital and borrowing capacity to meet its needs through the
earlier of the consummation of a Business Combination or one year from this
filing. Over this period, the Company will be using the funds held outside of
the Trust Account for paying existing accounts payable, identifying and
evaluating prospective initial Business Combination candidates, performing due
diligence on prospective target businesses, paying for travel expenditures,
selecting the target business to merge with or acquire, and structuring,
negotiating and consummating the Business Combination.
The Company's Sponsor, officers and directors may, but are not obligated to,
loan the Company funds from time to time or at any time, in whatever amount they
deem reasonable in their sole discretion, to meet the Company's working capital
needs. Accordingly, the Company may not be able to obtain additional financing
if needed. If the Company is unable to raise additional capital, it may be
required to take additional measures to conserve liquidity, which could include,
but not necessarily be limited to, curtailing operations, suspending the pursuit
of a potential transaction, and reducing overhead expenses.
On April 16, 2021, Broad Capital LLC agreed to loan us up to an aggregate amount
of up to $300,000 to cover expenses related to our IPO of our units. Following
the closing of our IPO on January 13, 2022, a total of $133,533 under the
promissory note was repaid on January 19, 2022.
Contractual obligations
As of December 31, 2022, we do not have any long-term debt, capital lease
obligations, operating lease obligations or long-term liabilities, other than an
agreement to pay an affiliate of our Sponsor a monthly fee of $10,000 for office
space, utilities and administrative support provided to the Company. We began
incurring these fees on January 13, 2022 and will continue to incur these fees
monthly until the earlier of the completion of the initial Business Combination
and the Company's liquidation. For the period April 16, 2021 (inception) through
December 31, 2022, $110,000 of expense was recorded and included in formation
and operating costs in the statement of operations.
The underwriter is entitled to deferred commissions of $3,555,674 from the Units
sold in the Initial Public Offering. The deferred commissions will become
payable to the underwriter from the amounts held in the Trust Account solely if
we complete a Business Combination, subject to the terms of the underwriting
agreement.
30
Critical Accounting Policies
The preparation of financial statements and related disclosures in conformity
with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities, disclosure of contingent assets and
liabilities at the date of the financial statements, and income and expenses
during the periods reported. Actual results could materially differ from those
estimates. We have not identified any critical accounting policies.
© Edgar Online, source Glimpses