Marblegate Capital Corp 8-K, filed Apr 11, 2025
Marblegate Capital Corp (MGTE)
About this 8-K
Marblegate Capital Corp filed this 8-K on April 11, 2025, reporting on events of April 7, 2025.
Items reported
- Item 1.01: Entered into a material agreement
- Item 2.01: Completed an acquisition or sale of assets
- Item 3.01: Delisting notice or listing transfer
- Item 3.03: Change to shareholders' rights
- Item 5.01: Change in control
- Item 5.02: Director or officer change, or executive pay
- Item 5.03: Charter or bylaw amendment, or fiscal year change
- Item 5.06: Change in shell company status
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
INTRODUCTORY NOTE
Unless the context otherwise requires, “we,” “us,” “our,” “New MAC” and the “Company” refer to Marblegate Capital Corporation, a Delaware corporation, and its consolidated subsidiaries. All references herein to the “Board” refer to the board of directors of the Company. Terms used in this Current Report on Form 8-K (this “Report”) but not defined herein, or for which definitions are not otherwise incorporated by reference herein, shall have the meaning given to such terms in the Proxy Statement/Prospectus and such definitions are incorporated herein by reference.
Business Combination Transaction
As previously announced, Marblegate Acquisition Corp., a Delaware corporation (“MAC”), previously entered into an agreement and plan of merger, dated as of February 14, 2023 (as may be amended, restated, supplemented, waived or otherwise modified from time to time in accordance with the terms thereof, the “Business Combination Agreement”), by and among MAC, Marblegate Asset Management, LLC, a Delaware limited liability company (“MAM”), Marblegate Capital Corporation, a Delaware corporation (“New MAC”), MAC Merger Sub, Inc., a Delaware corporation and a direct wholly owned subsidiary of New Mac (“Merger Sub”), DePalma Acquisition I LLC, a Delaware limited liability company (“DePalma I”), and DePalma Acquisition II LLC, a Delaware limited liability company (“DePalma II,” and together with DePalma I, the “DePalma Companies” or “DePalma”), pursuant to which MAC agreed to combine with DePalma in a series of transactions that will result in New MAC becoming a publicly traded company whose shares are expected trade on The Nasdaq Capital Market (collectively, the “Business Combination”).
At the special meeting of the MAC stockholders held on March 25, 2025 (the “Special Meeting”), the MAC stockholders considered, approved and adopted, among other matters, the Business Combination Agreement and the other proposals related thereto described in the final prospectus and definitive proxy statement, dated February 14, 2025 (the “Proxy Statement/Prospectus”) and filed with the Securities and Exchange Commission (the “SEC”).
The Closing (as defined below) was subject to, among other things, the approval by The Nasdaq Capital Market (“Nasdaq”) of New MAC’s initial Nasdaq listing application (the “Listing Condition”). On April 5, 2025, MAM, MAC, New MAC, Merger Sub and the DePalma Companies entered into a Waiver to the Business Combination Agreement (the “Waiver”) to waive the Listing Condition set forth in Section 7.3(d) of the Business Combination Agreement.
Immediately prior to the consummation of the Business Combination, on April 7, 2025, as contemplated by the Business Combination Agreement and described in the section titled “Unaudited Pro Forma Condensed Combined Financial Information—Description of the Business Combination—The Pre-Closing Transactions” beginning on page 176 of the Proxy Statement/Prospectus, New MAC and the DePalma Companies effected a series of reorganization transactions, resulting in the New MAC becoming the owner of approximately 83.7% of the DePalma Companies, with the remaining 16.3% continuing to be owned by certain limited partners of the DePalma Companies.
On April 7, 2025 (the “Closing” and, such date, the “Closing Date”), as contemplated by the Business Combination Agreement and as described in the section titled “Proposal No. 1—The Business Combination Proposal” beginning on page 132 of the Proxy Statement/Prospectus, MAC consummated the merger transaction, whereby Merger Sub merged with and into MAC, the separate corporate existence of Merger Sub ceasing and MAC being the surviving corporation and a direct wholly owned subsidiary of New MAC (the “Merger”), whereupon New MAC applied for the New MAC Common Stock and New MAC Warrants to be quoted, as soon as possible following the consummation of the Business Combination, on the OTCQX® Best Market (“OTCQX”) operated on The OTC Market systems (the “OTC Market”) under the symbols “MGTE” and “MGTEW”, respectively. On April 10, 2025, New MAC received approval from the OTC Markets for quotation of the New MAC Common Stock and New MAC Warrants on the OTCQX. The New MAC Common Stock and New MAC Warrants commenced trading on OTCQX at the open of business on April 10, 2025. There is no guarantee, however, that a broker will make a market in New MAC’s securities or that trading thereof will continue on the OTC Market or otherwise.
Pursuant to the Business Combination Agreement, upon effectiveness of the Merger, (i) each share of MAC’s Class A common stock, par value $0.0001 per share (“MAC Class A Common Stock”) and each share of MAC’s Class B common stock, par value $0.0001 per share (“MAC Class B Common Stock” and, together with the MAC Class A
Common Stock, the “MAC Common Stock”), issued and outstanding immediately prior to the effectiveness of the Merger was cancelled and converted into the right to receive the MAC Per Share Consideration (as defined in the Proxy Statement/Prospectus) in the form of common stock of New MAC (“New MAC Common Stock”); (ii) each whole warrant of MAC (“MAC Warrants”) outstanding immediately prior to the effectiveness of the Merger was cancelled in exchange for a warrant representing the right to purchase one warrant of New MAC (“New MAC Warrants”), with New MAC assuming MAC’s obligations under the existing warrant agreement, dated September 30, 2021, by and between Continental Stock Transfer & Trust Company and MAC (the “MAC Warrant Agreement”); and (iii) each of the issued and outstanding Units of MAC that had not been previously separated into the underlying shares of MAC Class A Common Stock and underlying MAC Warrants prior to the Closing upon the request of the holder thereof was cancelled and entitled the holder thereof to one share of New MAC Common Stock and one-half of one New MAC Warrant, with each whole New MAC Warrant representing the right to purchase one share of New MAC Common Stock at an exercise price of $11.50 per share on the terms and subject to the conditions set forth in the MAC Warrant Agreement.
Pursuant to the Business Combination Agreement, New MAC acquired approximately 83.7% of the outstanding equity interests of the DePalma Companies, in exchange for MAC Per Share Consideration in the form of New MAC Common Stock. The DePalma Equityholders (as defined in the Proxy Statement/Prospectus) received consideration in the form of New MAC Common Stock, as determined in accordance with the Business Combination Agreement.
The aggregate number of shares of New MAC Common Stock (the “Aggregate Merger Consideration”) issuable in connection with the consummation of the Business Combination is based on a valuation of the participating funds’ interests in DePalma of approximately $629.5 million including Minimum Cash. The MAC Per Share Consideration allocable to each share of MAC Common Stock is the number of shares of New MAC Common Stock, rounded up to the nearest whole share, equal to the quotient obtained by dividing (i) the product obtained by multiplying (A) $10.00 by (B) the Aggregate New MAC Capitalization (as defined in the Proxy Statement/Prospectus), by (ii) the total number of shares of MAC Common Stock outstanding immediately prior to the effectiveness of the Merger and after giving effect to any redemptions of shares of MAC Common Stock.
In connection with the Business Combination, holders of 322,274 shares of MAC Class A Common Stock sold in its initial public offering properly exercised their right to have such shares redeemed for a full pro rata portion of the trust account holding the proceeds from MAC’s initial public offering, calculated as of the Closing Date, or approximately $11.05 per share and $3.6 million in the aggregate.
Immediately after giving effect to the Business Combination, there were 73,914,402 shares of New MAC Common Stock issued and outstanding. Upon the consummation of the Business Combination, the shares of MAC Class A Common Stock and MAC Warrants ceased trading on The Nasdaq Stock Market LLC (“Nasdaq”). On April 10, 2025, New MAC received approval from the OTC Markets for quotation of the New MAC Common Stock and New MAC Warrants on OTCQX under the symbols “MGTE” and “MGTEW”, respectively. The New MAC Common Stock and New MAC Warrants commenced trading on OTCQX at the open of business on April 10, 2025. There is no guarantee, however, that a broker will make a market in New MAC’s securities or that trading thereof will continue on the OTC Market or otherwise. Immediately upon the consummation of the Business Combination, New MAC’s ownership was as follows (without taking into account any shares such persons may have purchased or sold in the open market prior to the consummation of the Business Combination):
| • | the DePalma Equityholders owned 62,954,464 shares of New MAC Common Stock, or approximately 85.2% of the shares of outstanding New MAC Common Stock, which represents approximately 85.2% of the voting power of New MAC; |
| • | New MAC’s public stockholders owned 3,197,002 shares, which represents approximately 4.3% of the voting power of New MAC, including MAC’s former public stockholders, who owned 46,605 shares of New MAC Common Stock, 2,912,182 Founder Shares, and 238,215 Private Placement Shares (each as defined in the Proxy Statement/Prospectus) that were transferred from the Sponsor to unaffiliated members of the Sponsor or their indirect beneficial owners prior to the consummation of the Business Combination, each of which were converted into shares of New MAC Common Stock upon the Closing; |
| • | the Sponsor owned 5,289,072 shares of New MAC Common Stock, or approximately 7.2% of the shares of outstanding New MAC Common Stock, which represents approximately 7.2% of the voting power of New MAC; and |
| • | the Anchor Investors (as defined in the Proxy Statement/Prospectus) owned 2,473,864 shares of New MAC Common Stock, or approximately 3.3% of the shares of outstanding New MAC Common Stock, which represents approximately 3.3% of the voting power of New MAC. |
A description of the Business Combination and the terms of the Business Combination Agreement is in the section titled “Proposal No. 1—The Business Combination Proposal” beginning on page 132 of the Proxy Statement/Prospectus. The foregoing descriptions of the Business Combination Agreement and the Waiver do not purport to be complete and are qualified in their entirety by the full text of the Business Combination Agreement and the Waiver, which are attached hereto as Exhibit 2.1 and Exhibit 2.2, respectively, and incorporated herein by reference.
Sponsor Support Agreement
As described in the Proxy Statement/Prospectus, in connection with the execution of the Business Combination Agreement, the Sponsor and certain directors and executive officers of MAC (the “Supporting Shareholders”) have entered into support agreements with MAC, New MAC and DePalma (such agreements, collectively, the “Sponsor Support Agreement”), pursuant to which the Sponsor and the Supporting Shareholders agreed, among other things, to vote all shares of MAC Common Stock held by them in favor of the Business Combination Agreement and the transactions contemplated thereby (including the Merger of Merger Sub with and into MAC) and to not redeem any of their shares of MAC Common Stock.
The foregoing description of the Sponsor Support Agreement does not purport to be complete and is qualified in its entirety by the full text of the Sponsor Support Agreement, which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.
| Item 1.01. | Entry into a Material Definitive Agreement. |
Registration Rights Agreement
On the Closing Date, New MAC, the Sponsor, the Supporting Shareholders and certain other parties entered into a registration rights agreement (which agreement contains terms and conditions similar to those contained in that certain registration rights agreement, dated as of September 30, 2021, among MAC, the Sponsor, and the other parties thereto (the “Registration Rights Agreement”)), pursuant to which, the Sponsor, the Supporting Shareholders, and certain other parties thereto will be granted certain registration rights with respect to their shares of New MAC Common Stock.
The foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Registration Rights Agreement, which is attached hereto as Exhibit 10.2 and is incorporated herein by reference.
Management Services Agreement
In connection with the Closing, New MAC entered into an agreement (the “Management Services Agreement”) with MAM. Pursuant to the Management Services Agreement, MAM shall provide certain management services to New MAC including (i) evaluating, managing, performing due diligence on, negotiating and overseeing the acquisition and disposition of New MAC’s and its subsidiaries’ assets, (ii) evaluating, managing, negotiating and overseeing the origination, structuring, restructuring and workout of taxi-medallion loans and other loans held by New MAC (other than typical daily loan servicing activities), (iii) managing New MAC’s and its subsidiaries’ day-to-day business and operations in complying with any regulatory requirements applicable to them in respect of their business activities, (iv) evaluating the financial and operational performance of any of New MAC’s subsidiaries, (v) providing a management team to serve as executive officers of New MAC and/or its subsidiaries, including providing day- to-day financial, operational and other executive management services, (vi) identifying, evaluating, managing, performing due diligence on, negotiating and overseeing the provision of debt or equity financing as well
as the acquisition of all or a portion of target businesses or assets, in each case, by New MAC, and (vii) performing any other services for and on behalf of New MAC and its subsidiaries to the extent that such services are consistent with those that are customarily performed by the executive officers and employees of a publicly listed company.
Additionally, MAM may also earn an incentive fee based on the financial performance of New MAC pursuant to a separate agreement to be entered into by New MAC and MAM and approved by the New MAC Board within six months of Closing.
The foregoing description of the Management Services Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Management Services Agreement, which is attached hereto as Exhibit 10.3 and is incorporated herein by reference.
Indemnification Agreements
On the Closing Date, New MAC entered into indemnification agreements with each of its directors and executive officers.
Each indemnification agreement provides for indemnification and advancements by New MAC of certain expenses and costs relating to claims, suits or proceedings arising from each director or executive officer’s service to New MAC, or, at New MAC’s request, service to other entities, as officers or directors to the maximum extent permitted by applicable law.
The foregoing description of the indemnification agreements does not purport to be complete and is qualified in its entirety by the terms and conditions of the indemnification agreements, a form of which is attached hereto as Exhibit 10.4 and is incorporated herein by reference.
| Item 2.01. | Completion of Acquisition or Disposition of Assets. |
The disclosure set forth under “Introductory Note—Business Combination Transaction” above is incorporated into this Item 2.01 by reference.
FORM 10 INFORMATION
Item 2.01(f) of Form 8-K states that if the registrant was a shell company, as the Company was immediately before the Business Combination, then the registrant must disclose the information that would be required if the registrant were filing a general form for registration of securities on Form 10. Accordingly, the Company is providing the information that would be included in a Form 10 if the Company were to file a Form 10. Please note that the information provided below relates to the Company as the combined company after the consummation of the Business Combination, unless otherwise specifically indicated or the context otherwise requires.
Forward-Looking Statements
This Report, and some of the information incorporated herein by reference, includes forward-looking statements regarding, among other things, the plans, strategies and prospects, both business and financial, of New MAC. These statements are based on the beliefs and assumptions of the management of New MAC. Although New MAC believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, it cannot assure you that it will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. These statements may be preceded by, followed by or include the words “believes,” “estimates,” “expects,” “projects,” “forecasts,” “may,” “will,” “should,” “seeks,” “plans,” “scheduled,” “anticipates” or “intends” or similar expressions. Forward-looking statements contained in this Report include, but are not limited to, statements about:
| • | New MAC’s limited operating history, which may make it difficult to successfully execute its strategic initiatives and accurately evaluate future risks and challenges; |
| • | the ability to maintain quotation of New MAC securities on the OTC Market; |
| • | the ability to be approved for initial listing, or to maintain the listing, of New MAC securities on Nasdaq; |
| • | New MAC’s failure to attract new borrowers or retain existing borrowers; |
| • | fluctuations in costs and economic activity, especially in New York City; |
| • | loss of confidential data from customers and employees, which may subject New MAC to litigation, liability or reputational damage; |
| • | failure to successfully compete; |
| • | failure to properly manage growth and relationships with various business partners; |
| • | failure to protect against software or hardware vulnerabilities; |
| • | failure to raise additional capital to develop the business; |
| • | risks related to the COVID-19 pandemic, including supply chain disruptions; |
| • | the loss of one or more of New MAC’s executive officers and other key employees at MAM and Field Point; |
| • | failure to hire and retain qualified employees; |
| • | failure to comply with federal, state and local laws and regulations; |
| • | the expected benefits of the Business Combination; and |
| • | other factors detailed in Part I, Item 1A of New MAC’s Annual Report on Form 10-K under “Risk Factors”, filed with the SEC on April 7, 2025 (the “Annual Report”), which is incorporated herein by reference. |
These and other factors that could cause actual results to differ from those implied by the forward-looking statements in this Report and in any document incorporated by reference are more fully described in Part I, Item 1A under the heading “Risk Factors” and elsewhere in the Annual Report which is incorporated herein by reference. The risks described in the Annual Report are not exhaustive. Other sections of the Annual report describe additional factors that could adversely affect the business, financial condition or results of operations of New MAC. New risk factors emerge from time to time, and it is not possible to predict all such risk factors, nor can New MAC assess the impact of all such risk factors on its business, or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements, which speak only as of the date hereof. All forward-looking statements made by New MAC’s or persons acting on its behalf are expressly qualified in their entirety by the foregoing cautionary statements. New MAC undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Business
The business of New MAC is described in Part I, Item 1 of the Annual Report in the section entitled “Business” and that information is incorporated herein by reference.
Risk Factors
The risk factors related to New MAC’s business and operations are set forth in Part I, Item 1A of the Annual Report in the section entitled “Risk Factors,” and that information is incorporated herein by reference.
Financial Information
The information set forth in Item 9.01 of this Report concerning the financial information of MAC, New MAC and the DePalma Companies is incorporated herein by reference.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
The Management’s Discussion and Analysis of Financial Condition and Results of Operations for the DePalma Companies for the years ended December 31, 2024 and 2023 is described in Part II, Item 7 of the Annual Report entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and that information is incorporated herein by reference.
Quantitative and Qualitative Disclosures about Market Risk
Reference is made to the disclosure contained in Part II, Item 7A of the Annual Report under “Quantitative and Qualitative Disclosures about Market Risk,” and that information is incorporated herein by reference.
Property
New MAC does not have any material principal physical properties.
Security Ownership of Certain Beneficial Owners and Management
Information with respect to the beneficial ownership of New MAC Common Stock is set forth in Part III, Item 12 of the Annual Report entitled “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters,” and that information is incorporated herein by reference.
Directors and Executive Officers
The Company’s directors and executive officers after the consummation of the Business Combination are described in Part III, Item 10 of the Annual Report entitled “Directors, Executive Officers and Corporate Governance,” and that information is incorporated herein by reference.
Director Independence
Information with respect to the independence of the Company’s directors is set forth in Part III, Item 10 of the Annual Report under the heading “Director Independence,” and that information is incorporated herein by reference.
Committees of the Board of Directors
Information with respect to the composition of the committees of the Company’s board of directors immediately after the consummation of the Business Combination is set forth in Part III, Item 10 of the Annual Report under the heading “Board Committees,” and that information is incorporated herein by reference.
Executive Compensation
A description of the compensation of the named executive officers of the DePalma Companies before the consummation of the Business Combination and the named executive officers of New MAC after the consummation of the Business Combination is set forth in Part III, Item 11 of the Annual Report entitled “Executive Compensation,” and that information is incorporated herein by reference.
Director Compensation
A description of the compensation of the directors of the DePalma Companies before the consummation of the Business Combination is set forth in Part III, Item 11 of the Annual Report entitled “Executive Compensation,” and that information is incorporated herein by reference.
Compensation Committee Interlocks and Insider Participation
A description of the compensation committee interlocks and insider participation of the Company is set forth in Part III, Item 11 of the Annual Report entitled “Compensation Committee Interlocks and Insider Participation,” and that information is incorporated herein by reference.
Certain Relationships and Related Party Transactions
Certain relationships and related party transactions of the Company are described in Part III, Item 13 of the Annual Report entitled “Certain Relationships and Related Transactions, and Director Independence,” and that information is incorporated herein by reference.
Legal Proceedings
Reference is made to the disclosure regarding legal proceedings in Part I, Item 3 of the Annual Report under “Legal Proceedings,” and that information is incorporated herein by reference.
Market Price of and Dividends on the Registrant’s Common Equity and Related Stockholder Matters
Reference is made to the disclosure regarding market price of and dividends on New MAC’s common equity and other related stockholder matters in Part II, Item 5 of the Annual Report under “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities,” and that information is incorporated herein by reference.
Description of Registrant’s Securities to Be Registered
The description of New MAC’s securities is contained in Exhibit 4.5 hereto and incorporated herein by reference.
Immediately following the consummation of the Business Combination, there were 73,914,402 shares of New MAC Common Stock issued and outstanding, held of record by 206 holders; no shares of preferred stock outstanding; and 15,304,987 warrants to purchase shares of New MAC Common Stock issued and outstanding. Such amounts do not include DTC participants or beneficial owners holding shares through nominee names.
Indemnification of Directors and Officers
The information set forth under Item 1.01 of this Report is incorporated herein by reference.
Financial Statements and Exhibits
The information set forth under Item 9.01 of this Report is incorporated herein by reference.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Reference is made to the disclosure regarding changes in and disagreements with accountants and accounting and financial disclosure in Part II, Item 9 of the Annual Report and that information is incorporated herein by reference.
| Item 3.01 | Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing. |
On April 11, 2025, in connection with the Closing, MAC filed a Form 25 to voluntarily delist its units, Class A common stock and warrants from The Nasdaq Capital Market.
| Item 3.03. | Material Modification to Rights of Security Holders. |
To the extent required by Item 3.03 of Form 8-K, the disclosure set forth in Items 1.01, 2.01 and 5.03 of this Report is incorporated by reference in this Item 3.03.
| Item 5.01. | Changes in Control of Registrant. |
The disclosure set forth in the “Introductory Note” above and Item 2.01 of this Report is incorporated into this Item 5.01 by reference.
| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Election of Directors; Appointment of Certain Officers
The information contained in the sections titled “Directors and Executive Officers,” “Committees of the Board,” “Executive Compensation,” “Certain Relationships and Related Transactions, and Director Independence” and “Indemnification of Directors and Officers” in Item 2.01 to this Report is incorporated herein by reference.
Effective as of the Closing, the following people were appointed as directors of the Company:
| • | Andrew Milgram; |
| • | Sarah E. Feinberg; |
| • | Harvey Golub; and |
| • | Frederick C. Herbst. |
Effective as of the Closing, the executive officers of the Company are:
| • | Andrew Milgram, Chief Executive Officer; |
| • | Paul Arrouet, President; and |
| • | Jeffrey Kravetz, Chief Financial Officer. |
Reference is made to the disclosure described in Part III, Item 10 of the Annual Report under the heading “Executive Officers” for biographical information about each of the directors and officers following the Business Combination, which is incorporated herein by reference.
| Item 5.03. | Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. |
On the Closing Date, New MAC amended and restated its certificate of incorporation (as amended and restated, the “Amended and Restated Charter”), which became effective upon filing with the Secretary of State of the State of Delaware on the Closing Date and included the amendments proposed by “Proposal No. 2—The Organizational Document Proposals”, and adopted amended and restated bylaws (the “Amended and Restated Bylaws”), which became effective immediately prior to the Closing.
Copies of the Amended and Restated Charter and Amended and Restated Bylaws are attached to this Report as Exhibit 3.1 and Exhibit 3.2, respectively, and incorporated herein by reference.
The material terms of the Amended and Restated Charter and the Amended and Restated Bylaws, and the general effect upon the rights of holders of the Company’s capital stock, are described in the sections of the Proxy Statement/Prospectus titled “Proposal No. 2—The Organizational Documents Proposals”, “Description of New MAC Securities” and “Comparison of Corporate Governance and Stockholders’ Rights” beginning on pages 188, 277 and 289, respectively, thereof, which information is incorporated herein by reference.
| Item 5.06. | Change in Shell Company Status. |
As a result of the Business Combination, which fulfilled the definition of an “initial business combination” as required by MAC’s organizational documents, the Company ceased to be a shell company upon the closing of the Business Combination. The material terms of the Business Combination are described in the sections titled “Proposal No. 1—The Business Combination Proposal” and “The Business Combination Agreement” beginning on page 132 and 160, respectively, of the Proxy Statement/Prospectus, and are incorporated herein by reference.
| Item 8.01. | Other Events. |
Effective as of April 7, 2025, Kirie Eleison Corp (“Kirie Eleison”) assigned all of its interests in Septuagint Solutions, LLC (“Septuagint”) to DePalma II, and the principals of Kirie Eleison resigned from the board of directors of Septuagint. DePalma II intends to continue operating Septuagint and its taxi fleet.
| Item 9.01. | Financial Statements and Exhibits. |
(a) Financial statements of businesses acquired.
The audited consolidated financial statements of DePalma Acquisition I LLC as of and for the years ended December 31, 2024 and 2023 are contained in Part IV, Item 15(a)(1) to the Annual Report and are incorporated herein by reference.
The audited consolidated financial statements of DePalma Acquisition II LLC as of and for the years ended December 31, 2024 and 2023 are contained in Part IV, Item 15(a)(1) to the Annual Report and are incorporated herein by reference.
The audited consolidated financial statements of MAC for the years ended December 31, 2024 and 2023 are contained in Part II, Item 8 to MAC’s Annual Report on Form 10-K filed with the SEC on March 31, 2025 and are incorporated herein by reference.
The audited consolidated financial statements of New MAC as of December 31, 2024 and 2023 and for the year ended December 31, 2024 and the period from February 2, 2023 (inception) through December 31, 2023 are contained in Part IV, Item 15(a)(1) to the Annual Report and are incorporated herein by reference.
(b) Pro forma financial information.
The unaudited pro forma condensed combined financial information of New MAC as of and for the year ended December 31, 2024 is set forth in Exhibit 99.1 and is incorporated herein by reference.
(d) Exhibits.
| 21.1 | List of Subsidiaries of Marblegate Capital Corporation (incorporated by reference to Exhibit 21.1 to the Annual Report on Form 10-K (File No. 333-283675), filed with the SEC on April 7, 2025). | |
| 99.1* | Unaudited pro forma condensed combined financial information of the Company. | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | |
| # | The annexes, schedules, and certain exhibits to this Exhibit have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Registrant hereby agrees to furnish supplementally a copy of any omitted annex, schedule or exhibit to the SEC upon request. |
| † | The annexes, schedules, and certain exhibits to this Exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Registrant hereby agrees to furnish supplementally a copy of any omitted annex, schedule or exhibit to the SEC upon request. |
| ‡ | Certain confidential information contained in this Exhibit has been omitted because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. |
| + | Indicates a management contract or compensatory plan. |
| * | Filed herewith. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: April 11, 2025
| Marblegate Capital Corporation | ||
| By: | /s/ Jeffrey Kravetz | |
| Name: | Jeffrey Kravetz | |
| Title: | Chief Financial Officer | |
Exhibit 99.1
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
The following unaudited pro forma condensed combined financial information presents the combination of the financial information of MAC, the DePalma Companies, and New MAC adjusted to give effect to the Business Combination and related transactions. The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X. Defined terms included below have the same meaning as terms defined and included elsewhere in this Current Report and, if not defined in this Current Report, the proxy statement/prospectus and/or the New MAC Annual Report on Form 10-K filed with the SEC on April 7, 2025.
The historical financial information of MAC, the DePalma Companies, and New MAC was derived from the audited financial statements of MAC, the DePalma Companies, and New MAC, respectively, as of December 31, 2024 and for the year ended December 31, 2024 included in the MAC Annual Report on Form 10-K filed with the SEC on April 3, 2025 and the New MAC Annual Report on Form 10-K, as applicable. This information should be read together with MAC’s, the DePalma Companies’, and New MAC’s separate financial statements and related notes thereto, the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, and other financial information included in the respective Annual Reports on Form 10-K of MAC and New MAC.
The Business Combination is accounted for as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with U.S. GAAP. Under this method of accounting, MAC is treated as the “acquired” company for financial reporting purposes. The DePalma Companies have been determined to be the accounting acquirer because the DePalma Companies, as a group, have the largest voting interest in New MAC upon consummation of the Business Combination, they represent a significant majority of the assets and operations of the combined company, and the principal physical locations for the combined company will remain consistent with the DePalma Companies’ locations. New MAC has been determined to be the surviving company in connection with the Business Combination and has had no prior operating activities.
The unaudited pro forma condensed combined balance sheet as of December 31, 2024 assumes that the Business Combination and related transactions occurred on December 31, 2024. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2024 gives pro forma effect to the Business Combination and related transactions as if they had occurred on January 1, 2024.
These unaudited pro forma condensed combined financial statements are for informational purposes only. They do not purport to indicate the results that would have been obtained had the Business Combination and related transactions actually been completed on the assumed date or for the periods presented, or which may be realized in the future. The pro forma adjustments are based on the information currently available and the assumptions and estimates underlying the pro forma adjustments are described in the accompanying notes. Actual results may differ materially from the assumptions within the accompanying unaudited pro forma condensed combined financial information.
Description of the Business Combination
On February 14, 2023, MAC entered into the Business Combination Agreement with MAM, the DePalma Companies, New MAC, and Merger Sub. On April 7, 2025, the Business Combination was consummated. MAC’s stockholders approved the transactions contemplated by the Business Combination Agreement at a special meeting of stockholders held on March 25, 2025, pursuant to which MAC agreed to combine with the DePalma Companies in the Business Combination that resulted in New MAC becoming a public company. Pursuant to the Business Combination Agreement, and subject to the terms and conditions contained therein, the Business Combination was effected as follows: (i) immediately prior to the consummation of the transactions contemplated by the Business Combination Agreement, New MAC and the DePalma Companies effected the Pre-Closing Transactions, resulting in New MAC becoming the owner of approximately 83.7% of the DePalma Companies, as described below, with the remaining 16.3% continuing owned by certain limited partners of the DePalma Companies, and (ii) Merger Sub merged with and into MAC, with MAC surviving as a wholly-owned subsidiary of New MAC.
The Pre-Closing Transactions
Prior to the Business Combination, the DePalma Companies were each managed and owned by their respective members (collectively, and together with their respective feeder funds and affiliates, the “DePalma Equityholders”), each of which were managed and controlled by MAM and its affiliates. DePalma Equityholders are a group of limited liability companies and limited partnerships, each of which was formed by MAM and its affiliates for investment purposes. DePalma I’s members consist of Marblegate Tactical Master Fund I, L.P., a Delaware limited partnership, Marblegate Special Opportunities Master Fund, L.P., a Cayman Islands exempted limited partnership, Marblegate Strategic Opportunities Master Fund I, LP, a Delaware limited partnership, Marblegate Partners Master
Fund I, L.P., a Cayman Islands exempted limited partnership, Marblegate Tactical III Master Fund I, LP, a Cayman Islands exempted limited partnership and Marblegate Cobblestone Master Fund I, LP, a Delaware limited partnership, and DePalma II’s members consist of Marblegate Tactical Master Fund II, L.P., a Delaware limited partnership, DePalma Dispatch Inc., a Delaware corporation and an entity indirectly 100% owned by Marblegate Special Opportunities Master Fund, L.P., a Cayman Islands exempted limited partnership, Marblegate Strategic Opportunities Master Fund I, LP, a Delaware limited partnership, Marblegate Partners Master Fund II, L.P., a Cayman Islands exempted limited partnership, Marblegate Tactical III Master Fund II, L.P., a Delaware limited partnership and Marblegate Cobblestone Master Fund I, LP, a Delaware limited partnership.
Immediately prior to the transactions contemplated by the Business Combination Agreement, a series of transactions were effectuated between New MAC, the DePalma Companies and DePalma Equityholders (the “Pre-Closing Transactions”). The Pre-Closing Transactions consisted of a series of transfers of the DePalma Companies’ equity from DePalma Equityholders to New MAC through a combination of contributions treated as non-taxable exchanges under Section 351 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) and mergers structured as tax-free mergers under Section 368(a)(1)(A) of the Code. As a result of the Pre-Closing Transactions, approximately 83.7% of the total equity of the DePalma Companies is held by New MAC, with approximately 16.3% continuing to be owned by certain limited partners of the DePalma Companies. As a result of the Pre-Closing Transactions, DePalma Equityholders received share consideration in New MAC which was determined based on the DePalma Equity Value, one of the components of which is calculated using the Minimum Cash Amount. Each of the DePalma Equity Value and Minimum Cash Amount are defined in the Business Combination Agreement and further detailed within the proxy statement/prospectus. The Minimum Cash Amount is comprised of cash as available from both MAC and the DePalma Companies at closing of the Business Combination. Pursuant to the Business Combination Agreement, the parties agreed that, at closing, New MAC shall have sufficient cash to pay unpaid transaction expenses of both MAC and the DePalma Companies, and have cash to meet working capital needs of New MAC.
The following table summarizes the components of the merger consideration transferred from New MAC to the DePalma Equityholders upon consummation of the Business Combination:
| DePalma I Equity Value |
||||
| Minimum Cash |
$ | 29,597,424 | ||
| Total Medallion Loan Value |
230,813,054 | |||
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|
|
|||
| DePalma I Equity Value |
260,410,478 | |||
| DePalma II Equity Value |
369,134,166 | |||
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|
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| Total DePalma Equity Value |
$ | 629,544,644 | ||
| Per share merger consideration |
$ | 10.00 | ||
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|
|||
| Shares of New MAC Common Stock issued to DePalma Equityholders |
62,954,464 | |||
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|
The following table summarizes the ownership of New MAC Common Stock immediately following the consummation of the Business Combination and related transactions:
| Number of Shares | Percentage of Outstanding Shares |
|||||||
| DePalma Equityholders |
62,954,464 | 85.2 | % | |||||
| Public Stockholders(1) |
3,197,002 | 4.3 | % | |||||
| Sponsors’ Founder Shares(2) |
4,917,287 | 6.7 | % | |||||
| Private Placement Shares(3) |
371,785 | 0.5 | % | |||||
| Anchor Founder Shares(4) |
2,473,864 | 3.3 | % | |||||
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|
|||||
| Total |
73,914,402 | 100.0 | % | |||||
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|
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| (1) | Represents (i) 46,605 shares of MAC Class A Common Stock held by public stockholders following redemptions prior to consummation of the Business Combination, (ii) 2,912,182 Founder Shares and (iii) 238,215 Private Placement Shares that were transferred from the Sponsor to unaffiliated members of the Sponsor or their indirect beneficial owners prior to the consummation of the Business Combination, each of which were converted into shares of New MAC Common Stock upon the closing of the Business Combination. |
| (2) | Includes 4,917,287 total shares of MAC Class A and Class B Common Stock after the transfer of 2,912,182 Founder Shares noted above, each of which were converted into shares of New MAC Common Stock upon the closing of the Business Combination. |
| (3) | Consists of 371,785 Private Placement Shares owned by the Sponsor after the transfer of 238,215 Private Placement Shares noted above. Excludes 300,000 shares owned by Cantor that were forfeited at closing. |
| (4) | Reflects 2,473,864 Founder Shares held by the Anchor Investors purchased from the Sponsor. |
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF DECEMBER 31, 2024
| MAC (Historical) |
DePalma I (Historical) |
DePalma II (Historical) |
New MAC (Historical) |
Transaction Accounting Adjustments |
Pro Forma Combined |
|||||||||||||||||||||
| ASSETS |
||||||||||||||||||||||||||
| Cash and cash equivalents |
$ | 71,532 | $ | 2,364,279 | $ | 32,809,108 | $ | — | $ | 4,064,428 | A | $ | 22,387,117 | |||||||||||||
| (3,549,620 | ) | B | ||||||||||||||||||||||||
| (9,697,610 | ) | C | ||||||||||||||||||||||||
| (3,675,000 | ) | D | ||||||||||||||||||||||||
| Prepaid expenses and other current assets |
38,190 | — | 247,993 | — | — | 286,183 | ||||||||||||||||||||
| Interest receivable |
— | 1,183,075 | 17,297 | — | — | 1,200,372 | ||||||||||||||||||||
| Due from related party |
— | 16,000 | — | — | (16,000 | ) | L | — | ||||||||||||||||||
| Loans held for investment, at fair value |
— | 278,571,140 | 2,426,821 | — | — | 280,997,961 | ||||||||||||||||||||
| Cash held in Trust Account |
4,064,428 | — | — | — | (4,064,428 | ) | A | — | ||||||||||||||||||
| Property and equipment, net |
— | — | 5,121,277 | — | — | 5,121,277 | ||||||||||||||||||||
| Operating lease right-of-use asset |
— | — | 4,909,944 | — | — | 4,909,944 | ||||||||||||||||||||
| Intangible assets |
— | — | 345,351,345 | — | — | 345,351,345 | ||||||||||||||||||||
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| Total assets |
$ | 4,174,150 | $ | 282,134,494 | $ | 390,883,785 | $ | — | $ | (16,938,230 | ) | $ | 660,254,199 | |||||||||||||
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| LIABILITIES, TEMPORARY EQUITY, AND STOCKHOLDERS’ EQUITY |
||||||||||||||||||||||||||
| Operating lease liability, current portion |
— | — | 314,920 | — | — | 314,920 | ||||||||||||||||||||
| Accrued professional fees |
— | 608,421 | 280,286 | — | — | 888,707 | ||||||||||||||||||||
| Income taxes payable |
58,065 | — | — | — | — | 58,065 | ||||||||||||||||||||
| Loan payments received in advance |
— | 72,849 | — | — | — | 72,849 | ||||||||||||||||||||
| Due to related party |
— | — | — | 16,000 | (16,000 | ) | L | — | ||||||||||||||||||
| Deposit liability - related party |
— | — | 7,085,772 | — | — | 7,085,772 | ||||||||||||||||||||
| Accounts payable and accrued expenses |
453,786 | 124,730 | 187,619 | 45,522 | (19,745 | ) | B | 3,544,117 | ||||||||||||||||||
| 2,752,205 | C | |||||||||||||||||||||||||
| Excise tax payable |
29,280 | — | — | — | — | 29,280 | ||||||||||||||||||||
| Service fee payable |
— | 1,181,227 | — | — | — | 1,181,227 | ||||||||||||||||||||
| Operating lease liability, net of current portion |
— | — | 4,602,754 | — | — | 4,602,754 | ||||||||||||||||||||
| Other liabilities |
— | — | 131,250 | — | — | 131,250 | ||||||||||||||||||||
| Deferred legal fees |
5,289,219 | — | — | — | (2,500,000 | ) | C | 2,789,219 | ||||||||||||||||||
| Promissory notes - related party |
3,385,000 | — | — | — | (3,385,000 | ) | D | — | ||||||||||||||||||
| Warrant liability |
13,650 | — | — | — | — | 13,650 | ||||||||||||||||||||
| Deferred underwriting fee payable |
15,000,000 | — | — | — | (3,000,000 | ) | C | — | ||||||||||||||||||
| (12,000,000 | ) | K | ||||||||||||||||||||||||
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|
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| Total liabilities |
24,229,000 | 1,987,227 | 12,602,601 | 61,522 | (18,168,540 | ) | 20,711,810 | |||||||||||||||||||
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| Temporary equity: |
||||||||||||||||||||||||||
| Class A common stock subject to possible redemption |
4,031,480 | — | — | — | (4,031,480 | ) | E | — | ||||||||||||||||||
| Stockholders’ equity (deficit): |
||||||||||||||||||||||||||
| New MAC common stock |
— | — | — | — | (32 | ) | B | 7,391 | ||||||||||||||||||
| 37 | E | |||||||||||||||||||||||||
| 6,295 | G | |||||||||||||||||||||||||
| 1,091 | H | |||||||||||||||||||||||||
| MAC Class A common stock |
491 | — | — | — | (491 | ) | H | — | ||||||||||||||||||
| MAC Class B common stock |
630 | — | — | — | (630 | ) | H | — | ||||||||||||||||||
| Additional paid-in capital |
— | — | — | — | (3,529,843 | ) | B | 543,171,942 | ||||||||||||||||||
| (290,000 | ) | D | ||||||||||||||||||||||||
| 4,031,443 | E | |||||||||||||||||||||||||
| (24,148,973 | ) | F | ||||||||||||||||||||||||
| 658,422,156 | G | |||||||||||||||||||||||||
| 30 | H | |||||||||||||||||||||||||
| 834,800 | I | |||||||||||||||||||||||||
| (104,147,671 | ) | J | ||||||||||||||||||||||||
| 12,000,000 | K | |||||||||||||||||||||||||
| Accumulated deficit |
(24,087,451 | ) | — | — | (61,522 | ) | (6,949,815 | ) | C | (7,784,615 | ) | |||||||||||||||
| 24,148,973 | F | |||||||||||||||||||||||||
| (834,800 | ) | I | ||||||||||||||||||||||||
| Members’ capital |
— | 280,147,267 | 378,281,184 | — | (658,428,451 | ) | G | — | ||||||||||||||||||
| Non-controlling interest |
— | — | — | — | 104,147,671 | J | 104,147,671 | |||||||||||||||||||
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|
|||||||||||||||
| Total stockholders’ equity (deficit) |
(24,086,330 | ) | 280,147,267 | 378,281,184 | (61,522 | ) | 5,261,790 | 639,542,389 | ||||||||||||||||||
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| Total liabilities, temporary equity, and stockholders’ equity |
$ | 4,174,150 | $ | 282,134,494 | $ | 390,883,785 | $ | — | $ | (16,938,230 | ) | $ | 660,254,199 | |||||||||||||
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See accompanying notes to the unaudited pro forma condensed combined financial statements.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2024
| MAC (Historical) |
DePalma I (Historical) |
DePalma II (Historical) |
New MAC (Historical) |
Transaction Accounting Adjustments |
Pro Forma Combined |
|||||||||||||||||||||
| Revenue: |
||||||||||||||||||||||||||
| Interest income |
$ | — | $ | 14,672,363 | $ | 543,682 | $ | — | $ | — | $ | 15,216,045 | ||||||||||||||
| Other revenue |
— | 5,788,139 | — | — | — | 5,788,139 | ||||||||||||||||||||
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|
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| Total revenue |
— | 20,460,502 | 543,682 | — | — | 21,004,184 | ||||||||||||||||||||
| Operating Expenses: |
||||||||||||||||||||||||||
| Operating and formation costs |
(2,572,136 | ) | — | — | — | — | (2,572,136 | ) | ||||||||||||||||||
| Service fee expense |
— | (4,450,000 | ) | — | — | — | (4,450,000 | ) | ||||||||||||||||||
| Depreciation expense |
— | — | (1,883,838 | ) | — | — | (1,883,838 | ) | ||||||||||||||||||
| Professional fees |
— | (4,581,954 | ) | (2,918,289 | ) | — | — | (7,500,243 | ) | |||||||||||||||||
| General and administrative |
— | (201,968 | ) | (340,515 | ) | (44,325 | ) | (8,030,921 | ) | DD | (8,617,729 | ) | ||||||||||||||
| Fleet servicing fees, net |
— | — | (542,374 | ) | — | — | (542,374 | ) | ||||||||||||||||||
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| Total expenses |
(2,572,136 | ) | (9,233,922 | ) | (5,685,016 | ) | (44,325 | ) | (8,030,921 | ) | (25,566,320 | ) | ||||||||||||||
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|
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| Income (loss) from operations |
(2,572,136 | ) | 11,226,580 | (5,141,334 | ) | (44,325 | ) | (8,030,921 | ) | (4,562,136 | ) | |||||||||||||||
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| Other income: |
||||||||||||||||||||||||||
| Interest earned on cash and marketable securities held in Trust Account |
253,924 | — | — | — | (253,924 | ) | AA | — | ||||||||||||||||||
| Stock compensation expense |
— | — | — | — | (834,800 | ) | CC | (834,800 | ) | |||||||||||||||||
| Change in fair value of warrant liabilities |
(6,143 | ) | — | — | — | — | (6,143 | ) | ||||||||||||||||||
| Transaction costs associated with the Business Combination |
— | — | — | — | (6,615,074 | ) | BB | (6,615,074 | ) | |||||||||||||||||
| Gains on loans held for investment, net |
— | 3,167,604 | — | — | — | 3,167,604 | ||||||||||||||||||||
| Gains from sale of medallions |
— | — | 83,000 | — | — | 83,000 | ||||||||||||||||||||
| Gains from in-kind medallion transfers, net - related parties |
— | — | 19,754 | — | (19,754 | ) | FF | — | ||||||||||||||||||
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|
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| Total other income |
247,781 | 3,167,604 | 102,754 | — | (7,723,552 | ) | (4,205,413 | ) | ||||||||||||||||||
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| Income (loss) before provision for income taxes |
(2,324,355 | ) | 14,394,184 | (5,038,580 | ) | (44,325 | ) | (15,754,473 | ) | (8,767,549 | ) | |||||||||||||||
| Provision for income taxes |
(70,162 | ) | — | — | — | — | (70,162 | ) | ||||||||||||||||||
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|
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| Net income (loss) |
(2,394,517 | ) | 14,394,184 | (5,038,580 | ) | (44,325 | ) | (15,754,473 | ) | (8,837,711 | ) | |||||||||||||||
| Less: Net income attributable to noncontrolling interest |
— | — | — | — | (24,206 | ) | EE | (24,206 | ) | |||||||||||||||||
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| Net income (loss) attributable to New MAC |
$ | (2,394,517 | ) | $ | 14,394,184 | $ | (5,038,580 | ) | $ | (44,325 | ) | $ | (15,778,679 | ) | $ | (8,861,917 | ) | |||||||||
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|||||||||||||||
| Net income (loss) per share (Note 4): |
||||||||||||||||||||||||||
| Basic and diluted weighted average shares outstanding, Class A common stock |
555,372 | |||||||||||||||||||||||||
| Basic and diluted net loss per common share, Class A common stock |
$ | (0.20 | ) | |||||||||||||||||||||||
| Basic and diluted weighted average shares outstanding, Class B common stock and non-redeemable Class A common stock |
11,213,333 | |||||||||||||||||||||||||
| Basic and diluted net loss per common share, Class B common stock and non-redeemable Class A common stock |
$ | (0.20 | ) | |||||||||||||||||||||||
| Weighted average shares outstanding - basic and diluted |
537,003,295 | 87,411,513 | — | |||||||||||||||||||||||
| Net income (loss) per share - basic and diluted |
$ | 0.03 | $ | (0.06 | ) | $ | — | |||||||||||||||||||
| Weighted average shares outstanding attributable to New MAC - basic and diluted |
73,914,402 | |||||||||||||||||||||||||
| Net loss per share attributable to New MAC - basic and diluted |
$ | (0.12 | ) | |||||||||||||||||||||||
See accompanying notes to the unaudited pro forma condensed combined financial statements.
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
Note 1. Description of the Business Combination
The unaudited pro forma condensed combined balance sheet as of December 31, 2024 assumes that the Business Combination and related transactions occurred on December 31, 2024. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2024 gives pro forma effect to the Business Combination and related transactions as if they had occurred on January 1, 2024.
The pro forma adjustments reflecting the consummation of the Business Combination and related transactions are based on certain currently available information and certain assumptions and methodologies that management believes are reasonable under the circumstances. The unaudited condensed combined pro forma adjustments, which are described in the accompanying notes, may be revised as additional information becomes available and is evaluated. Therefore, it is likely that the actual adjustments will differ from the pro forma adjustments, and it is possible the difference may be material. Management believes that its assumptions and methodologies provide a reasonable basis for presenting all of the significant effects of the Business Combination and related transactions based on information available to management at the time and that the pro forma adjustments give appropriate effect to those assumptions and are properly applied in the unaudited pro forma condensed combined financial information. MAC, the DePalma Companies and New MAC did not have a significant historical operating relationship prior to the Business Combination, however, MAC and the DePalma Companies had existing related party relationships as detailed elsewhere in the proxy statement/prospectus, and New MAC and the DePalma Companies had amounts due to and from each other for working capital purposes that have been eliminated by pro forma Adjustment L below. No other pro forma adjustments were required to eliminate activities between the companies.
The unaudited pro forma condensed combined financial information does not include corporate income tax effects of New MAC as the parties to the Business Combination are evaluating the post-closing tax implications and related accounting policies of the combined company. Accordingly, the unaudited pro forma condensed combined financial information may incorporate the historical tax effects of MAC and resulting tax payments made by MAC prior to closing of the Business Combination, however the condensed combined provision for income taxes does not necessarily reflect the amounts that would have resulted had the parties to the Business Combination filed consolidated income tax returns during the periods presented, nor does it reflect the amounts of pro forma deferred tax assets or liabilities as of the periods presented.
The unaudited pro forma condensed combined financial information does not give effect to any anticipated synergies, operating efficiencies, tax savings, or cost savings that may be associated with the Business Combination. The unaudited pro forma condensed combined financial information is not necessarily indicative of what the actual results of operations and financial position would have been had the Business Combination and related transactions taken place on the dates indicated, nor are they indicative of the future consolidated results of operations or financial position of New MAC. They should be read in conjunction with the separate historical financial statements and notes thereto of MAC, the DePalma Companies, and New MAC included elsewhere in the respective Annual Reports on Form 10-K of MAC and New MAC.
Note 2. Accounting Policies
Management is performing a comprehensive review of the entities’ accounting policies. As a result of the review, management may identify differences between the accounting policies of these entities which, when confirmed, could have a material impact on the financial statements of the post-closing New MAC. Based on its initial analysis, management did not identify any differences that would have a material impact on the unaudited pro forma condensed combined financial information, however as noted above, the parties to the Business Combination are evaluating the income tax accounting policies of the combined company. The unaudited pro forma condensed combined financial information does not assume any differences in accounting policies except for income tax accounting policies undergoing evaluation.
Note 3. Adjustments to Unaudited Pro Forma Condensed Combined Financial Information
The unaudited pro forma condensed combined financial information has been prepared to illustrate the effect of the Business Combination and related transactions and has been prepared for informational purposes only. The unaudited pro forma condensed combined financial information, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with, the separate historical audited financial statements of MAC, the DePalma Companies and New MAC included within the respective Annual Reports on Form 10-K of MAC and New MAC.
The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X. MAC has elected not to present management adjustments and is only presenting transaction accounting adjustments in the unaudited pro forma condensed combined financial information.
The pro forma basic and diluted net income (loss) per share amounts presented in the unaudited pro forma condensed combined statement of operations are based upon the number of shares of New MAC Common Stock outstanding, assuming the Business Combination and related transactions occurred on January 1, 2024.
Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet
The pro forma adjustments included in the unaudited pro forma condensed combined balance sheet as of December 31, 2024 are as follows:
Transaction Accounting Adjustments
| A. | Represents the reclassification of $4,064,428 held in the Trust Account as of December 31, 2024, inclusive of interest earned on the Trust Account, to cash and cash equivalents that becomes available at closing of the Business Combination, prior to additional redemptions and other outflows from the Trust Account before closing. |
| B. | Reflects the additional redemptions of 322,274 shares of MAC Class A Common Stock prior to closing of the Business Combination, for aggregate payments to redeeming Public Stockholders of $3,559,902 at a redemption price of $11.05 per share, allocated to common stock and additional paid-in capital using per value $0.0001 per share. Also reflects taxes paid out of the Trust of $19,745 as well as interest earned on the trust account subsequent to December 31, 2024 of $30,027. |
| C. | Represents estimated non-recurring transaction costs of $14,949,815 inclusive of accounting, advisory, legal, underwriting and other fees that are expensed as part of the Business Combination, of which $9,697,610 was paid at or prior to closing of the Business Combination and subsequent to December 31, 2024, and $5,252,205 is to be paid after closing of the Business Combination. Of the amounts paid at closing of the Business Combination, $3,000,000 is within deferred underwriting fee payable as of December 31, 2024, following the underwriter’s waiver of $12,000,000 of such deferred underwriting fees (see Adjustment K below), and $2,500,000 was accrued within deferred legal fees as of December 31, 2024. Of the amounts to be paid after closing of the Business Combination, an additional $2,500,000 remains accrued within deferred legal fees as of December 31, 2024 and $2,752,205 has been accrued within accounts payable and accrued expenses. |
| D. | Reflects the repayment of certain MAC related party promissory notes outstanding immediately prior to closing of the Business Combination totaling $3,675,000 that were paid at closing of the Business Combination, inclusive of draws on the promissory notes subsequent to December 31, 2024 of $290,000. |
| E. | Reflects the reclassification of $4,031,443 of MAC Common Stock that was subject to possible redemption as of December 31, 2024 to permanent equity. |
| F. | Reflects the reclassification of MAC’s and New MAC’s historical accumulated deficits into additional paid-in capital as part of the reverse recapitalization. |
| G. | Represents the recapitalization of DePalma I and DePalma II outstanding equity into New MAC common stock and additional paid-in capital as a result of the reverse recapitalization. |
| H. | Represents the exchange of 4,610,000 shares of MAC Class A Common Stock and 6,303,333 shares of Class B Common Stock into 10,913,333 shares of New MAC Common Stock, following the Founder Conversion and waiver and forfeiture of 300,000 Private Placement Shares owned by Cantor at closing. |
| I. | Reflects stock-based compensation expense of $834,800 related to shares transferred by the Sponsor to certain directors of MAC as per ASC 718 - Stock-based Compensation. Prior to the consummation of the MAC IPO, the Sponsor assigned an aggregate of 100,000 shares of MAC Class B Common Stock to these directors at a purchase price of $0.002 per share. The performance condition for the vesting of the shares is achieved upon the closing of the Business Combination, therefore, the expense has been presented as a pro forma adjustment to additional paid-in capital and accumulated deficit. |
| J. | Reflects non-controlling interests of 16.3% of certain limited capital partners of the DePalma Companies that retained interest in the DePalma Companies post-Business Combination. |
| K. | Reflects the reduction in deferred underwriting fees paid at closing of the Business Combination pursuant to the waiver of $12,000,000 of such fees by Cantor. |
| L. | Reflects the elimination of historical amounts due to and from the DePalma Companies and New MAC, respectively, as these transactions will be eliminated within the consolidation of New MAC. |
Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations
The pro forma adjustments included in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2024 are as follows:
| AA. | Reflects the elimination of investment income on the Trust Account. |
| BB. | Reflects transaction costs of $6,615,074 paid or accrued subsequent to December 31, 2024 or at closing of the Business Combination, as if incurred on January 1, 2024, the date the Business Combination occurred for the purposes of the unaudited pro forma condensed combined statement of operations. This is a non-recurring item. |
| CC. | Reflects stock-based compensation expense of $834,800 related to shares transferred by the Sponsor to certain directors of MAC as per ASC 718 - Stock-based Compensation. Prior to the consummation of the MAC IPO, the Sponsor assigned an aggregate of 100,000 Founder Shares to these directors at a purchase price of $0.002 per share. The performance condition for the vesting of the shares is achieved upon the Closing of the Business Combination. This is a non-recurring item. |
| DD. | Reflects estimated management fees to be incurred for services provided by MAM pursuant to the Management Services Agreement that was executed upon closing of the Business Combination and further detailed within the New MAC Annual Report on Form 10-K. The pro forma management fee presented is calculated, on a quarterly basis, as 0.375% multiplied by the pro forma net assets attributable to New MAC stockholders as of December 31, 2024. |
| EE. | Reflects net income attributable to non-controlling interests of 16.3% of certain limited partners of DePalma I and DePalma II that retained interest in the DePalma Companies post-Business Combination. |
| FF. | Reflects the elimination of realized gains on in-kind transfers of taxi medallions between DePalma II and DePalma I of $19,754 for the year ended December 31, 2024 as these transactions will be eliminated within the consolidation of New MAC. |
Note 4. Net Loss per Share
Net loss per share was calculated using the historical weighted average shares outstanding, and the issuance of additional shares in connection with the Business Combination and the related transactions, assuming the shares were outstanding since January 1, 2024. As the Business Combination and the related transactions are being reflected as if they had occurred at the beginning of the period presented, the calculation of weighted average shares outstanding for basic and diluted net loss per share assumes that the shares issuable relating to the Business Combination and related transactions have been outstanding for the entirety of the period presented.
| For the Year Ended December 31, 2024 |
||||
| Pro forma net loss attributable to New MAC |
$ | (8,861,917 | ) | |
| Weighted average shares outstanding - basic and diluted |
73,914,402 | |||
| Pro forma net loss per share attributable to New MAC - basic and diluted |
$ | (0.12 | ) | |
| Potentially dilutive securities: | ||||
| Public Warrants |
15,000,000 | |||
| Private Placement Warrants |
305,000 | |||
| (1) | Pro forma net loss per share attributable to New MAC includes the related pro forma adjustments as referred to within the section “Unaudited Pro Forma Condensed Combined Financial Information.” |
| (2) | The potentially dilutive outstanding securities were excluded from the computation of pro forma net loss per share attributable to New MAC - basic and diluted, because their effect would have been anti-dilutive or the issuance or vesting of such shares is contingent upon the satisfaction of certain conditions which were not satisfied by the end of the periods presented. |