NBSTW Newbury Street Acquisition Corporation

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2023

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                  to

Commission file number: 001-40251

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Securities registered pursuant to Section 12(b) of the Act:

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Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

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Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒  No ☐

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer, “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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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.  ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

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If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes  ☒  No ☐

The aggregate market value of the outstanding shares of the registrant's Common Stock, other than shares held by persons who may be deemed affiliates of the registrant, computed by reference to the closing price for the Common Stock on June 30, 2023, the last business day of the registrant’s most recently completed second fiscal quarter, as reported on the Nasdaq Stock Market LLC was approximately $55,554,238.

As of June 5, 2024, there were 4,948,937 shares of Common Stock, par value $0.0001 per share, of the registrant issued and outstanding.

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Report (as defined below), including, without limitation, statements under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” includes forward-looking statements within the meaning of Section 27A of the Securities Act (as defined below) and Section 21E of the Exchange Act (as defined below). These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. Such statements include, but are not limited to, any statements relating to our ability to consummate any acquisition or other Business Combination (as defined below) and any other statements that are not statements of current or historical facts. These statements are based on Management’s (as defined below) current expectations, but actual results may differ materially due to various factors, including, but not limited to:

Additionally, on January 24, 2024, the SEC (as defined below) adopted the 2024 SPAC Rules (as defined below), which will become effective on July 1, 2024, that will affect SPAC (as defined below) Business Combination transactions. The 2024 SPAC Rules require, among other matters, (i) additional disclosures relating to SPAC Business Combination transactions; (ii) additional disclosures relating to dilution and to conflicts of interest involving sponsors and their affiliates in both SPAC initial public offerings and Business Combination transactions; (iii) additional disclosures regarding projections included in SEC filings in connection with proposed Business Combination transactions; and (iv) the requirement that both the SPAC and its target company be co-registrants for Business Combination registration statements. In addition, the SEC’s adopting release provided guidance describing circumstances in which a SPAC could become subject to regulation under the Investment Company Act (as defined below), including its duration, asset composition, business purpose, and the activities of the SPAC and its management team in furtherance of such goals. The 2024 SPAC Rules may materially affect our ability to negotiate and complete our initial Business Combination and may increase the costs and time related thereto.

The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

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Unless otherwise stated in this Report, or the context otherwise requires, references to:

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PART I

Item 1.      Business.

Overview

We are a blank check company incorporated on November 6, 2020 as a Delaware corporation and formed for the purpose of effecting an initial Business Combination. While we may pursue an acquisition or Business Combination target in any business or industry, we have focused our search on a technology business in the consumer internet or media space, including sports and entertainment verticals, with enterprise values of approximately $500 million to $2.5 billion. In particular, we have focused on finding disruptive, high growth companies, such as Infinite Reality, with a global ambition that take advantage of: (i) the rise of new consumer behaviors driven by the internet or new technologies, or (ii) paradigm shifts in media, sports and entertainment that give rise to disruptive new entrants here to stay for the coming decades.

Our Management Team is composed of experienced dealmakers and highly regarded industry veterans in the consumer internet and media space. The Management Team has decades of experience investing into and operating innovative and transformative platforms in consumer internet and media, as well as scaling businesses into new geographies, especially Asia. We believe that the experience and capabilities of our Management Team make us an attractive partner to potential target businesses, enhance our ability to complete a successful Business Combination, and add value to the business post-Business Combination.

Our Management Team represents a unique combination of operating, investing, financial and transactional experience. Our Management Team has a strong track record of creating value for shareholders in multiple consumer internet and media companies that they have led, managed and/or invested in. Our Management Team also has a history of making substantial non-control investments that allow existing teams to continue their growth.

We believe we are an attractive partner to a target company, such as Infinite Reality. Our Management Team has an extensive history scaling businesses and improving public companies. We have a diverse and value-added network to source and find follow-on opportunities. Our Management Team also has experience navigating the complexities of operating as a public company. Our view is that supportive capital and a long-term orientation are attractive as a partner first mentality that differentiates us from competition. We intend to help our target company focus on sustainable long-term value creation post close, with a high return on reinvestment.

The 2024 SPAC Rules may materially affect our ability to negotiate and complete our initial Business Combination and may increase the costs and time related thereto.

Initial Public Offering

On March 25, 2021, we consummated our Initial Public Offering of 12,000,000 Units. Each Unit consists of one Public Share and one-half of one Public Warrant, with each whole Public Warrant entitling the holder thereof to purchase one share of Common Stock for $11.50 per share. The Units were sold at a price of $10.00 per Unit, generating gross proceeds to our Company of $120.00 million.

Simultaneously with the closing of the Initial Public Offering, we completed the private sale of an aggregate of 390,000 Private Units to our Sponsor and EBC in the Private Placement at a purchase price of $10.00 per Private Unit (340,000 Units to our Sponsor and 50,000 Units to EBC), generating gross proceeds of $3.90 million. On March 30, 2021, the underwriters exercised the over-allotment option in part and purchased an additional 843,937 Units, generating gross proceeds of approximately $8.44 million. In connection with the exercise of the underwriters’ over-allotment option, our Sponsor and EBC purchased an aggregate of 16,879 Private Units (14,715 Units to our Sponsor and 2,164 Units to EBC), generating gross proceeds of $168,790.

A total of $128.44 million, comprised of $125.87 million of the proceeds from the Initial Public Offering and $2.57 million of the proceeds of the Private Placement, was placed in the Trust Account maintained by Continental, acting as trustee.

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It is the job of our Sponsor and Management Team to complete our initial Business Combination. Our Management Team is led by Matthew Hong, our Chairman and the former Chief Operating Officer of Turner Sports, and seasoned executives Thomas Bushey, our Chief Executive Officer, and Kenneth King, our Chief Financial Officer. Mr. Bushey and Mr. King have decades of experience identifying, acquiring, investing in and operating businesses, and provide depth of knowledge in capital markets. We must complete our initial Business Combination by September 25, 2024, the end of our Combination Period, which is 42 months from the closing of our Initial Public Offering. If our initial Business Combination is not consummated by the end of our Combination Period, then, unless our Board of Directors shall otherwise determine, our existence will terminate, and we will distribute all amounts in the Trust Account.

Extensions of Our Combination Period

We initially had up to 24 months from the closing of the Initial Public Offering, or until March 25, 2023, to complete a Business Combination, which was extended to (i) September 25, 2023 at the First Special Meeting upon approval by our stockholders of the First Extension Amendment Proposal, (ii) March 25, 2024 at the Second Special Meeting upon approval by our stockholders of the Second Extension Amendment Proposal and (iii) September 25, 2024 at the Third Special Meeting upon approval by our stockholders of the Third Extension Amendment Proposal.

In connection with the vote to approve the First Extension Amendment Proposal, the holders of 7,744,085 Public Shares properly exercised their right to redeem their Public Shares for cash at a redemption price of approximately $10.17 per share, for an aggregate redemption amount of approximately $78.77 million. As a result, approximately $78.77 million was removed from the Trust Account to pay such holders. Following the First Special Meeting Redemptions, we had 8,917,715 shares of Common Stock issued and outstanding.

In connection with the vote to approve the Second Extension Amendment Proposal, the holders of 3,060,282 Public Shares properly exercised their right to redeem their Public Shares for cash at a redemption price of approximately $10.46 per share, for an aggregate redemption amount of approximately $32.00 million. As a result, approximately $32.00 million was removed from the Trust Account to pay such holders. Following the Second Special Meeting Redemptions, we had 5,857,433 shares of Common Stock issued and outstanding.

In connection with the vote to approve the Third Extension Amendment Proposal, the holders of 908,496 Public Shares properly exercised their right to redeem their Public Shares for cash at a redemption price of approximately $10.75 per share, for an aggregate redemption amount of  approximately $9.77 million. As a result, approximately $9.77 million was removed from the Trust Account to pay such holders. Following the Third Special Meeting Redemptions, we had 4,948,937 shares of Common Stock issued and outstanding.

As of December 31, 2023, following the First Special Meeting Redemptions and the Second Special Meeting Redemptions, we had approximately $21.58 million in the Trust Account.

In connection with the approval of the First Extension Amendment Proposal, the Sponsor or its designees agreed to contribute to us, under the WCL Promissory Note, (i) the Initial Contribution, plus, (ii) an aggregate of $200,000 per month (commencing on June 23, 2023 and on the 23rd day of each subsequent month) until September 25, 2023, or portion thereof, that was needed to complete an initial Business Combination, which amount was to be deposited into the Trust Account.

On March 24, 2023, the Sponsor made the Initial Contribution of $600,000, which was deposited into the Trust Account. On June 26, 2023, $200,000 was deposited into the Trust Account, which was comprised of a $100,000 payment from the Sponsor and a $100,000 payment from Infinite Reality. The remaining Monthly Extension Fees in connection with the approval of the First Extension Amendment Proposal were paid by Infinite Reality pursuant to the Second Merger Agreement Amendment.

In connection with the approval of the Second Extension Amendment Proposal, Infinite Reality agreed to contribute the Monthly Extension Fee to us, which amounted to $0.025 for each Public Share that was not redeemed in the Second Special Meeting Redemptions, or $50,989.25 (commencing on September 23, 2023 and on the 23rd day of each subsequent month) until March 25, 2024, or portion thereof, that was needed to complete an initial Business Combination. The Monthly Extension Fees in connection with the approval of the Second Extension Amendment were paid by Infinite Reality pursuant to the Second Merger Agreement Amendment.

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In connection with the approval of the Third Extension Amendment Proposal, Infinite Reality agreed to contribute the Monthly Extension Fee to us, which amounted to $0.03 for each Public Share that was not redeemed in the Third Special Meeting Redemptions, or $33,932.22 (commencing on March 23, 2024 and on the 23rd day of each subsequent month) until September 25, 2024, or portion thereof, that is needed to complete an initial Business Combination.

As of the date of this Report, we do not plan to seek to further extend the Combination Period. Our Sponsor may also explore transactions under which it would sell its interest in our Company to another management team.

Infinite Reality Business Combination

On December 12, 2022, we entered into the Infinite Reality Merger Agreement with Pubco, the Merger Subs, consisting of Purchaser Merger Sub and Infinite Reality Merger Sub, and Infinite Reality.

On May 15, 2023, the Infinite Reality Merger Agreement Parties entered into the First Merger Agreement Amendment to provide for (i) a revised definition of the term “Fully Diluted Shares”, (ii) the removal of Section 7.2(b) of the Infinite Reality Merger Agreement (Minimum Cash Condition) in its entirety; and (iii) the addition of a new Section 6.23 providing for the payment by the Company of all transaction expenses up to $10 million in connection with the consummation of the Mergers and the other transactions contemplated by the Infinite Reality Merger Agreement.

On July 21, 2023, the Infinite Reality Merger Agreement Parties entered into the Second Merger Agreement Amendment to provide for the addition of a new Section 6.24 pursuant to which Infinite Reality agreed to pay the Monthly Extension Fees directly into the Trust Account on our behalf, on or before the date when such payment becomes due, until the completion of the Mergers. In addition, if the Infinite Reality Merger Agreement is terminated for any reason other than our breach, Infinite Reality agrees to pay all expenses we incurred after March 31, 2023, provided that in no event shall such payment exceed $3,000,000 (inclusive of all Monthly Extension Fees paid). In the event that the Mergers are consummated, we agreed to pay for all transaction expenses up to $10,000,000 in connection with the consummation of the Mergers and the other transactions contemplated by the Infinite Reality Merger Agreement.

On February 26, 2024, the Infinite Reality Merger Agreement Parties entered into the Third Merger Agreement Amendment to provide for, among other things, (i) the addition of a new Section 6.25 providing for the delivery by Infinite Reality of certain deliverables by the deadlines set forth therein, (ii) the addition of a new Section 8.1(j) granting us the right to terminate the Infinite Reality Merger Agreement if Infinite Reality breaches Section 6.25 or fails to meet any of the deadlines set forth therein, (iii) the amendment of Section 8.2(d) providing for the payment by Infinite Reality to us of certain reimbursement fees in the event of a termination pursuant to Section 8.1(j), and (iv) an amendment to the definition of “Monthly Extension Fee.”

Pursuant to the terms of the Infinite Reality Merger Agreement, (i) under the Purchaser Merger, the Purchaser Merger Sub will merge with and into our Company, with our Company continuing as the surviving entity, (ii) under the Infinite Reality Merger, the Infinite Reality Merger Sub will merge with and into Infinite Reality, with Infinite Reality continuing as the surviving entity and (iii) following the Mergers, our Company and Infinite Reality will become direct wholly-owned subsidiaries of Pubco, and Pubco will become a publicly traded company.

The below subsection describes the material provisions of the Infinite Reality Merger Agreement, but does not purport to describe all the terms thereof. This summary of the Infinite Reality Merger Agreement is qualified in its entirety by reference to the complete text of the Infinite Reality Merger Agreement, First Merger Agreement Amendment, Second Merger Agreement Amendment and Third Merger Agreement Amendment, copies of which are filed hereto as Exhibits 2.1, 2.2, 2.3 and 2.4, respectively, and incorporated by reference herein. Unless otherwise defined herein, the capitalized terms used below have the same meanings given to them in the Infinite Reality Merger Agreement. Unless otherwise indicated, this Report does not assume the closing of the Infinite Reality Business Combination.

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Effect of the Mergers

In consideration for the Infinite Reality Business Combination, at the time the Mergers are consummated and effective (the “Effective Time”), by virtue of the Purchaser Merger and without any action on the part of any party or the holders of securities of any of our Company, Pubco, and the Merger Subs (each a “Purchaser Party”) or Infinite Reality:

(i)each of our issued and outstanding Units prior to the Effective Time will be automatically detached and the holder thereof will be deemed to hold one share of our Common Stock and one half of one Public Warrant;

(ii)each of our issued and outstanding Private Units prior to the Effective Time will be automatically detached and the holder thereof will be deemed to hold one share of our Common Stock and one-half of one Private Warrant;

(iii)each share of our issued and outstanding Common Stock (other than the Excluded Shares (as defined below) and the Founder Shares) prior to the Effective Time will be converted automatically into one unit (each, a “Pubco Unit”), consisting of (x) one share of common stock, par value $0.0001 per share, of Pubco (“Pubco Common Stock”) and (y) one (1) CVR (as defined below) following which all shares of our Common Stock shall automatically be canceled;

(iv)each of our issued and outstanding Public Warrants prior to the Effective Time will be assumed by Pubco and converted into one warrant entitling the holder thereof to purchase one share of Pubco Common Stock at a price of $11.50 per share;

(v)each of our issued and outstanding Private Warrants immediately prior to the Effective Time will be assumed by Pubco and converted into one warrant entitling the holder thereof to purchase one (1) share of Pubco Common Stock at a price of $11.50 per share;

(vi)each share of our Common Stock, if any, (x) held in our treasury, (y) otherwise held by us or any of our subsidiaries or (z) for which a Public Stockholder has demanded that we redeem such Public Share (collectively, the “Excluded Shares”) will be cancelled;

(vii)  each Founder Share will convert solely into one share of Pubco Common Stock; and

(viii)  each share of common stock of Purchaser Merger Sub outstanding immediately prior to the Effective Time will be converted into an equal number of shares of our Common Stock, with the same rights, powers and privileges as the shares so converted and will constitute the only outstanding shares of capital stock of our Company.

Pursuant to the Infinite Reality Merger Agreement, Infinite Reality will use commercially reasonable efforts to cause the holders of outstanding obligations of Infinite Reality and its direct and indirect subsidiaries under the Convertible Promissory Notes (the “Infinite Reality Convertible Instruments”) to convert all of their Infinite Reality Convertible Instruments into shares of common stock, par value $0.0001 per share, of Infinite Reality (the “Infinite Reality Common Stock”) at the applicable conversion ratio (including any accrued or declared but unpaid dividends) as set forth in the Infinite Reality Convertible Instruments (the “Infinite Reality Exchanges”) prior to the Effective Time, provided, that to the extent that Infinite Reality, or its direct or indirect subsidiaries, has the right or the option to cause the conversion of an Infinite Reality Convertible Instrument into shares of Infinite Reality Common Stock, Infinite Reality shall exercise such right or option on or prior to the date and time at which the consummation of the transactions contemplated by the Infinite Reality Merger Agreement (the “Closing”) is actually held (the “Closing Date”).

At the Effective Time, by virtue of the Infinite Reality Merger and without any action on the part of any party or the holders of securities of any Purchaser Party or Infinite Reality:

(i)subject to clause (ii) below, each share of Infinite Reality Common Stock issued and outstanding immediately prior to the Effective Time (after giving effect to the Infinite Reality Exchanges) will automatically be cancelled and cease to exist in exchange for the right to receive a number of shares of Pubco Common Stock equal to the result obtained by applying the then-current conversion ratio, and each holder of Infinite Reality Common Stock shall cease to have any other rights in and to Infinite Reality (subject to certain rights set forth in the Infinite Reality Merger Agreement);

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(ii)notwithstanding clause (i) above, any shares of Infinite Reality Common Stock owned by Infinite Reality as treasury shares or owned by any direct or indirect subsidiary of Infinite Reality immediately prior to the Effective Time shall be canceled and shall cease to exist and no consideration will be delivered or deliverable in exchange therefor;

(iii)each outstanding option to purchase Infinite Reality Common Stock that was granted pursuant to Company Equity Plan (as defined in the Infinite Reality Merger Agreement) (each, a “Infinite Reality Option”) (whether vested or unvested) shall be assumed by Pubco and automatically converted into an option to purchase shares of Pubco Common Stock, subject to the terms and conditions set forth in the Company Equity Plan;

(iv)each outstanding warrant to purchase Infinite Reality Common Stock that was granted pursuant to that certain Note and Warrant Purchase Agreement, dated as of July 1, 2021, entered into by and among the Infinite Reality, the investors party thereto and Black, Inc. (each, a “Infinite Reality Warrant”) shall be assumed by Pubco and automatically converted into a warrant for shares of Pubco Common Stock, subject to the terms and conditions of the Infinite Reality Warrant;

(v)any other convertible security of Infinite Reality, other than Infinite Reality Options, if not exercised or converted prior to the Effective Time, shall be cancelled, retired and terminated and cease to represent a right to acquire, be exchanged for or convert into shares of Infinite Reality Common Stock; and

(vi)all shares of Common Stock of Infinite Reality Merger Sub outstanding immediately prior to the Effective Time shall be converted into an equal amount of shares of Common Stock of Infinite Reality, with the same rights, powers and privileges as the shares so converted and shall constitute the only shares of capital stock in Infinite Reality.

At the Effective Time, by virtue of the Mergers and without any action on the part of any party or the holders of securities of any Purchaser Party or Infinite Reality, all of the shares of Pubco issued and outstanding immediately prior to the Effective Time shall be canceled and extinguished and no consideration will be delivered or deliverable in exchange therefor.

Related Agreements

This section describes the material provisions of certain additional agreements entered into or to be entered into pursuant to or in connection with the Infinite Reality Merger Agreement (the “Ancillary Agreements”) but does not purport to describe all of the terms thereof. The following summary is qualified in its entirety by reference to the complete text of each of the Ancillary Agreements, forms of which are filed as exhibits to the Report and incorporated herein by reference.

Voting Agreements

In connection with entry into the Infinite Reality Merger Agreement, our Company and certain holders of Infinite Reality Common Stock representing the requisite vote required to adopt the Infinite Reality Merger Agreement and approve the transactions contemplated thereby, have entered into voting agreements (the “Voting Agreements”), pursuant to which, among other things, each such holder has agreed to vote in favor of the Infinite Reality Merger Agreement and the Infinite Reality Merger, and vote against certain competing proposals.

In addition, such holders of Infinite Reality Common Stock agreed not to exercise appraisal rights with respect to the Infinite Reality Business Combination. Such Infinite Reality stockholders also agreed to not transfer any securities of Infinite Reality held by them from the date of execution of the Voting Agreements until the earlier of the Effective Time or the termination of the Infinite Reality Merger Agreement in accordance with its terms, subject to certain exceptions.

The Voting Agreements will terminate in their entirety, and be of no further force or effect, upon the earliest to occur of (i) the Effective Time, (ii) the valid termination of the Infinite Reality Merger Agreement in accordance with its terms, or (iii) the time such Voting Agreement is terminated upon the mutual written agreement of our Company, Infinite Reality and the holder of Infinite Reality Common Stock party thereto.

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Sponsor Letter Agreement

In connection with the entry into the Infinite Reality Merger Agreement, our Company, Infinite Reality, Pubco and the Sponsor entered into a Sponsor letter Agreement (the “Sponsor Letter Agreement”) pursuant to which the Sponsor has agreed to vote in favor of the Infinite Reality Merger Agreement and the transactions contemplated thereby on the terms and conditions set forth in the Sponsor Letter Agreement.

Pursuant to the Sponsor Letter Agreement, the Sponsor has also agreed that it will not transfer any shares of Pubco Common Stock held by the Sponsor immediately following the Closing issued in exchange for the Founder Shares held by the Sponsor (the “Sponsor Lock-Up Shares”) until the end of the applicable Sponsor Lock-Up Period (as defined below) with respect to such Sponsor Lock-Up Shares. As used in the Sponsor Letter Agreement, the “Sponsor Lock-Up Period” means the period beginning on the date of the Sponsor Letter Agreement and ending (i) in respect of Sponsor Lock-Up Shares of the Sponsor (other than those Sponsor Lock-Up Shares specified in clause (ii) below), on the earlier to occur of (x) the date that is six calendar months after the Closing Date or (y) the Pubco Common Stock VWAP for the preceding thirty (30) consecutive trading days equals or exceeds $13.50; and (ii) in respect of Sponsor Lock-Up Shares that are allocable to the officers and directors of the Sponsor, on the earlier to occur of (x) the date that is eighteen (18) calendar months after the Closing Date or (y) the termination of the Contingent Value Rights Agreement (the “CVR Agreement”) in accordance with its terms.

Lock-Up Agreements

In connection with its entry into the Infinite Reality Merger Agreement, Infinite Reality shall use its commercially reasonable efforts to obtain, as promptly as reasonably practicable following the date of the Infinite Reality Merger Agreement, from the holders of 1% or more of Infinite Reality stock each member of the Infinite Reality board of directors, and each officer of Infinite Reality (collectively, the “Infinite Reality Holders”), to execute lock-up agreements with Pubco (each, a “Lock-Up Agreement”), pursuant to which each Infinite Reality Holder will agree not to, during the Lock-Up Period (as defined below), offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any of the shares issued in connection with the Mergers, enter into a transaction that would have the same effect, or enter into any swap, hedge or other arrangement that transfers, in whole or in part, any of the economic consequences of ownership of such shares, whether any of these transactions are to be settled by delivery of any such shares, in cash, or otherwise.

As used in the Lock-Up Agreements, the “Lock-Up Period” means the period commencing on the Closing Date and ending (i) in respect of each Infinite Reality Holder (other than Infinite Reality Holders specified in clause (ii) below) and their permitted transferees, the earlier to occur of (x) the date that is six calendar months after the Closing Date or (y) the Pubco Common Stock VWAP for the preceding thirty (30) consecutive trading days equals or exceeds $13.50; and (ii) in respect of each Infinite Reality Holder who is an officer, director, or 5% beneficial owner of Infinite Reality and their permitted transferees, on the earlier to occur of (x) the date that is eighteen (18) calendar months after the Closing Date or (y) the termination of the CVR Agreement in accordance with its terms.

Contingent Value Rights Agreement

At or prior to the Closing, Pubco will enter into a CVR Agreement with a rights agent (“Rights Agent”) pursuant to which the holders of our Common Stock (other than holders of Excluded Shares and Founder Shares, in respect of such shares) outstanding as of immediately prior to the Effective Time will receive one contingent value right (each, a “CVR”) for each one whole share of our Common Stock held by such stockholder on such date. Each CVR will represent the contractual right to receive a contingent payment in the form of shares of Pubco Common Stock (or in such other form as is provided for in the CVR Agreement), in an amount to be determined on the CVR Maturity Date (as that term is defined in the CVR Agreement), and to be paid as soon as practicable after the Settlement Date but not after the Payment Date (or, if earlier, upon a Change of Control) (as such terms are defined in the CVR Agreement). The payment to be received pursuant to each CVR is an amount calculated as a function of the excess of the Target Value over the Achieved Value up to the Share Cap (as such terms are defined in the CVR Agreement).

The contingent payments under the CVR Agreement, if they become payable, will become payable to the Rights Agent for subsequent distribution to the holders of the CVRs. There can be no assurance that any payment of any shares of Pubco Common Stock will be made or that any holders of CVRs will receive any amounts with respect thereto.

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The right to the contingent payments contemplated by the CVR Agreement is a contractual right only and will not be transferable, except in the limited circumstances specified in the CVR Agreement. The CVRs will be evidenced by certificates for Pubco Units registered in the names of the holders thereof (which certificates shall also be deemed to be certificates representing CVRs) and not by separate CVR certificates. The CVRs will not have any voting or dividend rights and will not represent any equity or ownership interest in Pubco or any of its affiliates. No interest will accrue on any amounts payable in respect of the CVRs.

Other Ancillary Agreements

As promptly as reasonably practicable following the date of the Infinite Reality Merger Agreement, Infinite Reality and our Company shall negotiate in good faith and prepare (i) a registration rights agreement of Pubco, (ii) an amendment to the Warrant Agreement, and (iii) the forms of amended and restated certificate of incorporation and bylaws of Pubco, in form and substance reasonably acceptable to each of the parties, in each case to be effective upon the Closing.

Industry Opportunity

The Covid-19 pandemic accelerated multiple trends that were already underway in the media, consumer, sports, and/or entertainment industries. Convergence among each of the four industries, strengthened by technology, has brought about opportunities for businesses to grow and attract consumers.

The global video streaming market was valued at $50.1 billion in 2020 and is expected to grow 20.4% from 2020 to 2027. The popularity of such platforms has increased as a result of economic lockdowns, and there is higher viewership demand for major video streaming platforms, with Over-The-Top (“OTT”) media services (i.e. media content delivered over the Internet without the involvement of a traditional cable provider) accounting for 40% of global video streaming revenues in 2019, higher than traditional cable and pay-TV. The high penetration of smart devices, like smart TV and smartphone, growing demand for Video on Demand (VoD) content, and a high rate of per-user payment are some of the major factors driving the OTT market. The surging percentage of viewing time going to OTT video content is also changing the global entertainment landscape. According to the Arizona-based Limelight Networks, globally, viewers spend an average of 6.8 hours per week consuming OTT video, with the United States topping the averages at 8.6 hours.

The sports industry has also been profoundly affected by the Covid-19 pandemic. Multiple sporting events in the United States were delayed or outright cancelled. This has resulted in eSports filling in the void created by the disappearance of traditional sports on television, with positive responses from fans and consumers, being made possible by the prevalence of streaming services. Two such instances include the eNASCAR iRAcing Pro Invitational Series on Fox Sports 1, and the NBA 2K game between Phoenix Suns and Dallas Mavericks, which attracted 1.6 million and 221,000 viewers, respectively.

Additionally, the success of video streaming platforms has led to changes in the way studios release movies, as consumers watch more films from home on streaming video services. As a result, several studios have released movies in the form of Premium Video on Demand (“PVoD”) services. During the early phase of COVID-19 stay at home orders, Deloitte found that 22% of consumers had paid to rent or watch a PVoD movie, and 90% of those said they would do so again. As the pandemic has continued, studios have released more movies via PVoD, and viewership has grown. As of October 2020, 35% of consumers say they’ve watched a PVoD release.

In the coming decade, the metaverse is also emerging as the biggest new growth opportunity for several industries, given the sheer breadth of potential applications and uses and the degree of investment from large technology companies, venture capital funds, and corporations and brands. By 2023, the metaverse may generate up to $5 trillion across consumer and enterprise use cases. Industries are already implementing metaverse initiatives, although most efforts to date have been centered around marketing; learning and development for employees; virtual meetings, events, or conferences; and product design or digital twinning applications.

Of all the potential drivers of the economic impact of the metaverse, e-commerce is the largest. It is estimated to have a market impact of $2 trillion to $2.6 trillion by 2030 depending on whether a base or upside case for the metaverse’s development is realized, a contribution which is expected to dwarf sectors such as academic virtual learning (an estimated $180 billion to $270 billion impact), advertising (an estimated $144 billion to $206 billion impact), and gaming (an estimated $108 billion to $125 billion impact).

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Gaming eclipses other subsectors of the entertainment industry with its popularity. With more than three billion users globally and a total value of more than $200 billion, the gaming sector is currently a larger industry than movies and music. Consumers and companies are already experimenting with the early metaverse from socializing to fitness, commerce, virtual learning, and scores of other daily activities. While gaming is already mainstream (and providing the largest current online worlds in terms of players), additional use cases are emerging rapidly—including new AR/VR-powered social-media experiences, immersive retail, entertainment, sports, and education.

Our Business Strategy & Competitive Strengths

We have focused our search for an initial Business Combination with private companies, such as Infinite Reality, that have compelling unit economics combined with a clear path to positive operating cash flow. Our selection process leverages a unique set of relationships with proven deal-sourcing capabilities to provide us with a strong pipeline of potential targets. We distinguish ourselves with our ability to:

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Acquisition Criteria

We have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses, such as Infinite Reality. While we have used these criteria and guidelines in evaluating acquisition opportunities and initially target businesses with enterprise values of approximately $500 million to $2.5 billion, we may decide to enter into our initial Business Combination with a target business that only meets some, but not all of these criteria and guidelines. We intend to acquire one or more businesses, like Infinite Reality, that we believe has the following characteristics:

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These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial Business Combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our Management may deem relevant. In the event that we decide to enter into our initial Business Combination with a target business that only meets some but not all of the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial Business Combination, which, as discussed in this Report, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC, such as the Infinite Reality Registration Statement.

Our Acquisition Process

In evaluating a prospective target business, we conduct thorough due diligence that encompasses, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial and other information made available to us. We utilize our operational and capital allocation experience. We are not prohibited from pursuing an initial Business Combination with a company that is affiliated with our Sponsor, officers or directors. While Infinite Reality is not affiliated with our Sponsor, executive officers or directors, in the event we do not consummate the Infinite Reality Business Combination and we seek to complete our initial Business Combination with a company that is affiliated with our Sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that our initial Business Combination is fair to our Company from a financial point of view.

Members of our Management Team and our independent directors directly or indirectly own Founder Shares, Private Shares and/or Private Warrants and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial Business Combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular Business Combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial Business Combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a Business Combination opportunity. Accordingly, if any of our officers or directors becomes aware of a Business Combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our Business Combination.

Initial Business Combination

Nasdaq rules and our Amended and Restated Charter require that our initial Business Combination must occur with one or more target businesses, including Infinite Reality, that together have an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding taxes payable on the income earned on the Trust Account) at the time of the agreement to enter into the initial Business Combination. If our Board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria.

Effecting a Business Combination

General

We are not presently engaged in, and we will not engage in, any substantive commercial business until we consummate our initial Business Combination with Infinite Reality or another target (and we have not identified any other potential targets for our initial Business Combination). We intend to utilize cash derived from the proceeds of our Initial Public Offering and the sale of Private Units, our capital stock, debt or a combination of these in effecting a Business Combination. A Business Combination may involve the acquisition of, or merger with, a company that does not need substantial additional capital, but which desires to establish a public trading market for its shares, while avoiding what it may deem to be adverse consequences of undertaking a public offering itself. These include time delays, significant expense, loss of voting control and compliance with various federal and state securities laws. In the alternative, we may seek to consummate a Business Combination with a company that may be financially unstable or in its early stages of development or growth. While we may seek to effect simultaneous Business Combinations with more than one target business, we will probably have the ability, as a result of our limited resources, to effect only a single Business Combination.

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Sources of Target Businesses

While we have selected Infinite Reality as the target business with which to consummate our initial Business Combination, we believe based on our Management’s business knowledge and past experience that there are numerous potential candidates if the Infinite Reality Business Combination is not consummated. Our principal means of identifying potential target businesses are through the extensive contacts and relationships of our Initial Stockholders, officers, directors and advisors. While our officers and directors are not required to commit any specific amount of time in identifying or performing due diligence on potential target businesses, our officers and directors believe that the relationships they have developed over their careers and their access to our Sponsor’s contacts and resources will generate a number of potential Business Combination opportunities that will warrant further investigation. Target business candidates have also been brought to our attention from various unaffiliated sources, including investment bankers, venture capital funds, private equity funds, leveraged buyout funds, management buyout funds and other members of the financial community. Target businesses may be brought to our attention by such unaffiliated sources as a result of being solicited by us through calls or mailings. These sources may also introduce us to target businesses they think we may be interested in on an unsolicited basis, since many of these sources will have read this report and know what types of businesses we are targeting.

Our officers and directors must present to us all target business opportunities that have a fair market value of at least 80% of the assets held in the Trust Account at the time of the agreement to enter into the initial Business Combination, subject to any pre-existing fiduciary or contractual obligations. While we do not presently anticipate engaging the services of professional firms or other individuals that specialize in business acquisitions on any formal basis (other than EBC as described elsewhere in this Report), we may engage these firms or other individuals in the future, in which event we may pay a finder’s fee, consulting fee or other compensation to be determined in an arm’s length negotiation based on the terms of the transaction. In no event, however, are our Initial Stockholders, officers, directors or their respective affiliates paid any compensation prior to, or for any services they render in order to effectuate, the consummation of an initial Business Combination (regardless of the type of transaction that it is) other than the $10,000 per month administrative fee pursuant to the Administrative Support Agreement, the payment of consulting, success or finder fees in connection with the consummation of our initial Business Combination, the repayment of the funds loaned under the IPO Promissory Note and reimbursement of any out-of-pocket expenses. Our Audit Committee reviews and approves all reimbursements and payments made to our Sponsor, officers, directors or our or their respective affiliates, with any interested director abstaining from such review and approval.

Selection of a Target Business and Structuring of a Business Combination

Subject to our Management Team’s pre-existing fiduciary obligations and the limitations that a target business, including Infinite Reality, have a fair market value of at least 80% of the balance in the Trust Account at the time of the execution of a definitive agreement for our initial Business Combination, as described below in more detail, and that we must acquire a controlling interest in the target business, our Management has virtually unrestricted flexibility in identifying and selecting a prospective target business. We have not established any specific attributes or criteria (financial or otherwise) for prospective target businesses. In evaluating a prospective target business, our Management may consider a variety of factors, including one or more of the following:

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These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular Business Combination is based, to the extent relevant, on the above factors as well as other considerations deemed relevant by our Management in effecting a Business Combination consistent with our business objective.

Any costs incurred with respect to the identification and evaluation of a prospective target business with which a Business Combination is not ultimately completed result in a loss to us and reduce the amount of capital available to otherwise complete a Business Combination.

Fair Market Value of Target Business

Nasdaq listing rules require that the target business or businesses that we acquire must collectively have a fair market value equal to at least 80% of the balance of the funds in the Trust Account at the time of the execution of a definitive agreement for our initial Business Combination and Infinite Reality met this requirement at the time we entered into the Infinite Reality Merger Agreement with them. Notwithstanding the foregoing, if we are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% fair market value test.

We currently anticipate structuring a Business Combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial Business Combination where we merge directly with the target business or a newly formed subsidiary or where we acquire less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the Business Combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the Business Combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we could acquire a 100% controlling interest in the target; however, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial Business Combination could own less than a majority of our outstanding shares subsequent to our initial Business Combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of Trust Account balance test.

The fair market value of the target will be determined by our Board of Directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). The proxy solicitation materials or tender offer documents used by us in connection with any proposed transaction, such as the Infinite Reality Registration Statement, will provide Public Stockholders with our analysis of the fair market value of the target business, as well as the basis for our determinations. If our Board is not able to independently determine that the target business has a sufficient fair market value, we will obtain an opinion from an unaffiliated, independent investment banking firm, or another independent entity that commonly renders valuation opinions, with respect to the satisfaction of such criteria. We will not be required to obtain an opinion from an investment banking firm as to the fair market value if our Board of Directors independently determines that the target business complies with the 80% threshold.

Lack of Business Diversification

We may seek to effect a Business Combination with more than one target business, although we expect to complete our initial Business Combination with just one business, like Infinite Reality, although there is no assurance that we will complete the Infinite Reality Business Combination. Therefore, at least initially, the prospects for our success may be entirely dependent upon the future performance of a single business operation. Unlike other entities that may have the resources to complete several Business Combinations of entities operating in multiple industries or multiple areas of a single industry, it is probable that we will not have the resources to diversify our operations or benefit from the possible spreading of risks or offsetting of losses. By consummating a Business Combination with only a single entity, our lack of diversification may:

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If we determine to simultaneously acquire several businesses and such businesses are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent on the simultaneous closings of the other acquisitions, which may make it more difficult for us, and delay our ability, to complete the Business Combination. With multiple acquisitions, we could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services or products of the acquired companies in a single operating business.

Limited Ability to Evaluate the Target Business’ Management

Although we have scrutinized the management of a prospective target business, including the Infinite Reality management team, when evaluating the desirability of effecting a Business Combination and plan to continue to do so in the event the Infinite Reality Business Combination is not consummated and we seek other Business Combination opportunities, we cannot assure you that our assessment of the target business’ management will prove to be correct. In addition, we cannot assure you that the future management will have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future role of our officers and directors, if any, in the target business following a Business Combination cannot presently be stated with any certainty. While it is possible that some of our key personnel will remain associated in senior management or advisory positions with us following a Business Combination, including the Infinite Reality Business Combination in which Thomas Bushey will serve as a director of the combined company post-Closing, it is unlikely that they will devote their full-time efforts to our affairs subsequent to our Business Combination. Moreover, they would only be able to remain with the company after the consummation of our Business Combination if they are able to negotiate employment or consulting agreements in connection with the Business Combination. Such negotiations would take place simultaneously with the negotiation of the Business Combination and could provide for them to receive compensation in the form of cash payments and/or our securities for services they would render to the company after the consummation of the Business Combination. While the personal and financial interests of our key personnel may influence their motivation in identifying and selecting a target business, their ability to remain with the company after the consummation of a Business Combination will not be the determining factor in our decision as to whether or not we will proceed with any potential Business Combination. Additionally, we cannot assure you that our officers and directors will have significant experience or knowledge relating to the operations of the particular target business.

Following a Business Combination, we may seek to recruit additional managers to supplement the incumbent management of the target business. We cannot assure you that we will have the ability to recruit additional managers, or that any such additional managers we recruit will have the requisite skills, knowledge or experience necessary to enhance the incumbent management.

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Stockholders May Not Have the Ability to Approve an Initial Business Combination

In connection with any proposed Business Combination, we will either (i) seek stockholder approval of our initial Business Combination at a meeting called for such purpose at which Public Stockholders may seek to redeem their Public Shares, regardless of whether they vote for or against the proposed Business Combination or do not vote at all, into their pro rata share of the aggregate amount then on deposit in the Trust Account (net of taxes payable), or (ii) provide our Public Stockholders with the opportunity to sell their Public Shares to us by means of a tender offer (and thereby avoid the need for a stockholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the Trust Account (net of taxes payable), in each case subject to the limitations described herein. The decision as to whether we will seek stockholder approval of a proposed Business Combination or will allow Public Stockholders to sell their Public Shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval. If we determine to engage in a tender offer, such tender offer will be structured so that each Public Stockholder may tender all of his, her or its Public Shares rather than some pro rata portion of his, her or its Public Shares. In that case, we will file tender offer documents with the SEC, which will contain substantially the same financial and other information about the initial Business Combination as is required under the SEC’s proxy rules. Whether we seek stockholder approval or engage in a tender offer, we will consummate our initial Business Combination only if we have net tangible assets of at least $5,000,001 immediately prior to or upon consummation of such Business Combination and, if we seek stockholder approval, a majority of the outstanding shares of Common Stock voted are voted in favor of the Business Combination. We have no specified maximum percentage threshold for redemptions in our Amended and Restated Charter and even those Public Stockholders who vote in favor of our initial Business Combination have the right to redeem their Public Shares. As a result, this may make it easier for us to consummate our initial Business Combination.

We chose our net tangible asset threshold of $5,000,001 to ensure that we would avoid being subject to Rule 419 promulgated under the Securities Act. However, if we seek to consummate an initial Business Combination with a target business that imposes any type of working capital closing condition or requires us to have a minimum amount of funds available from the Trust Account upon consummation of such initial Business Combination, we may need to have more than $5,000,001 in net tangible assets immediately prior to or upon consummation and this may force us to seek third party financing, which may not be available on terms acceptable to us or at all. As a result, we may not be able to consummate such initial Business Combination and we may not be able to locate another suitable target within the Combination Period, if at all. Public Stockholders may therefore have to wait until the end of the Combination Period to consummate an initial Business Combination in order to be able to receive a pro rata share of the Trust Account.

Pursuant to the Letter Agreement, our Sponsor, officers and directors have agreed (i) to vote any shares of Common Stock owned by them in favor of any proposed Business Combination, (ii) not to redeem any shares of Common Stock in connection with a stockholder vote to approve a proposed initial Business Combination and (iii) not sell any shares of Common Stock in any tender in connection with a proposed initial Business Combination.

None of our officers, directors, Sponsor, EBC or their affiliates has indicated any intention to purchase Units or shares of Common Stock from persons in the open market or in private transactions. However, if we hold a meeting to approve a proposed Business Combination and a significant number of stockholders vote, or indicate an intention to vote, against such proposed Business Combination or that they wish to redeem their shares, our officers, directors, Sponsor, EBC or their affiliates could make such purchases in the open market or in private transactions in order to influence the vote and reduce the number of redemptions. Notwithstanding the foregoing, our officers, directors, Sponsor, EBC and their affiliates will not make purchases of shares of Common Stock if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act, which are rules designed to stop potential manipulation of a company’s stock.

Redemption Rights

At any meeting called to approve an initial Business Combination, including the Infinite Reality Business Combination, Public Stockholders may seek to redeem their Public Shares, regardless of whether they vote for or against the proposed Business Combination or do not vote at all, into their pro rata share of the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the initial Business Combination, less any taxes then due but not yet paid. As of December 31, 2023, the amount in the Trust Account was approximately $10.58 per share. Alternatively, we may provide our Public Stockholders with the opportunity to sell their Public Shares to us through a tender offer (and thereby avoid the need for a stockholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the Trust Account, less any taxes then due but not yet paid.

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Our Sponsor and our officers and directors do not have redemption rights with respect to any shares of Common Stock owned by them, directly or indirectly, whether acquired prior to our Initial Public Offering or purchased by them in our Initial Public Offering or in the aftermarket. Additionally, the holders of the Representative Shares and the Private Shares do not have redemption rights with respect to the Representative Shares and the Private Shares.

We may require Public Stockholders, whether they are a record holder or hold their Public Shares in “street name,” to either (i) tender their certificates to our transfer agent or (ii) deliver their Public Shares to the transfer agent electronically using DWAC System, at the holder’s option, in each case prior to a date set forth in the proxy materials sent in connection with the proposal to approve the Business Combination.

There is a nominal cost associated with the above-referenced delivery process and the act of certificating the shares or delivering them through the DWAC System. The transfer agent will typically charge the tendering broker a nominal amount and it would be up to the broker whether or not to pass this cost on to the holder. However, this fee would be incurred regardless of whether or not we require holders seeking to exercise redemption rights. The need to deliver shares is a requirement of exercising redemption rights regardless of the timing of when such delivery must be effectuated. However, in the event we require Public Stockholders seeking to exercise redemption rights prior to the consummation of the proposed Business Combination and the proposed Business Combination is not consummated, this may result in an increased cost to redeeming stockholders.

Any proxy solicitation materials we furnish to stockholders in connection with a vote for any proposed initial Business Combination will indicate whether we are requiring stockholders to satisfy such certification and delivery requirements. Accordingly, a Public Stockholder would have from the time the stockholder received our proxy statement up until the vote on the proposal to approve the Business Combination to deliver his, her or its Public Shares if he, she or it wishes to seek to exercise his, her or its redemption rights. This time period varies depending on the specific facts of each transaction. However, as the delivery process can be accomplished by the Public Stockholder, whether or not he is a record holder or his, her, or its Public Shares are held in “street name,” in a matter of hours by simply contacting the transfer agent or his, her, or its broker and requesting delivery of his, her or its Public Shares through the DWAC System, we believe this time period is sufficient for an average investor. However, we cannot assure you of this fact.

Any request to redeem such Public Shares once made, may be withdrawn at any time up to the vote on the proposed Business Combination or the expiration of the tender offer. Furthermore, if a Public Shareholder delivered his, her or its certificate in connection with an election of their redemption and subsequently decides prior to the applicable date not to elect to exercise such rights, he may simply request that the transfer agent return the certificate (physically or electronically).

If the initial Business Combination is not approved or completed for any reason, then our Public Stockholders who elected to exercise their redemption rights would not be entitled to redeem their Public Shares for the applicable pro rata share of the Trust Account. In such case, we will promptly return any Public Shares delivered by Public Stockholders.

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Liquidation if No Business Combination

Our Amended and Restated Charter provides that we have until the end of the Combination Period to complete an initial Business Combination. If we have not completed an initial Business Combination within the Combination Period, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible, but not more than ten business days thereafter, redeem 100% of the outstanding Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including any interest not previously released to us, but net of taxes payable, divided by the number of then outstanding Public Shares, which redemption will completely extinguish Public Stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our Board of Directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to our obligations under the DGCL to provide for claims of creditors and the requirements of other applicable law.

Pursuant to the Letter Agreement, our Sponsor, officers and directors have agreed that they will not propose any amendment to our Amended and Restated Charter that would affect our Public Stockholders’ ability to redeem or sell their Public Shares to us in connection with a Business Combination as described herein or affect the substance or timing of our obligation to redeem 100% of our Public Shares if we do not complete a Business Combination within the Combination Period, unless we provide our Public Stockholders with the opportunity to redeem their Public Shares upon such approval at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest not previously released to us, but net of franchise and income taxes payable, divided by the number of then outstanding Public Shares. This redemption right shall apply in the event of the approval of any such amendment, whether proposed by our Sponsor, executive officers, directors or any other person.

Under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion of our Trust Account distributed to our Public Stockholders upon the redemption of 100% of our outstanding Public Shares in the event we do not complete our initial Business Combination within the Combination Period may be considered a liquidation distribution under Delaware law. If the corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution. It is our intention to redeem our Public Shares as soon as reasonably possible following the end of the Combination Period, and, therefore, we do not intend to comply with those procedures. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend well beyond the third anniversary of such date.

Furthermore, if the pro rata portion of our Trust Account distributed to our Public Stockholders upon the redemption of 100% of our Public Shares in the event we do not complete our initial Business Combination within the Combination Period is not considered a liquidation distribution under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidation distribution.

Because we will not be complying with Section 280 of the DGCL, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the subsequent ten years. However, because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses.

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We are required to seek to have all third parties (including any vendors or other entities we engage after our Initial Public Offering) and any prospective target businesses enter into agreements with us waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account. As a result, the claims that could be made against us will be limited, thereby lessening the likelihood that any claim would result in any liability extending to the Trust Account. We therefore believe that any necessary provision for creditors will be reduced and should not have a significant impact on our ability to distribute the funds in the Trust Account to our Public Stockholders. Nevertheless, Marcum, our independent registered public accounting firm, and the underwriters of our Initial Public Offering, will not execute agreements with us waiving such claims to the monies held in the Trust Account. Furthermore, there is no guarantee that other vendors, service providers and prospective target businesses will execute such agreements. Nor is there any guarantee that, even if they execute such agreements with us, they will not seek recourse against the Trust Account. Our Sponsor has agreed that it will be liable to ensure that the proceeds in the Trust Account are not reduced below $10.00 per share by the claims of target businesses or claims of vendors or other entities that are owed money by us for services rendered or contracted for or products sold to us, but we cannot assure you that it will be able to satisfy its indemnification obligations if it is required to do so. We have not asked our Sponsor to reserve for such indemnification obligations, nor have we independently verified whether our Sponsor has sufficient funds to satisfy its indemnity obligations and believe that our Sponsor’s only assets are securities of our Company. Therefore, we believe it is unlikely that our Sponsor will be able to satisfy its indemnification obligations if it is required to do so. Additionally, the agreement our Sponsor entered into specifically provides for two exceptions to the indemnity it has given: it will have no liability (i) as to any claimed amounts owed to a target business or vendor or other entity who has executed an agreement with us waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account, or (ii) as to any claims for indemnification by the underwriters of our Initial Public Offering against certain liabilities, including liabilities under the Securities Act. As a result, if we liquidate, the per-share distribution from the Trust Account could be less than $10.00 due to claims or potential claims of creditors.

We anticipate notifying the trustee of the Trust Account to begin liquidating such assets promptly after the end of the Combination Period and anticipate it will take no more than 10 business days to effectuate such distribution. The holders of the Founder Shares and Representative Shares have waived their rights to participate in any liquidation distribution from the Trust Account with respect to such shares. There will be no distribution from the Trust Account with respect to our Warrants, which will expire worthless. We will pay the costs of any subsequent liquidation from our remaining assets outside of the Trust Account. If such funds are insufficient, our Sponsor has contractually agreed to advance us the funds necessary to complete such liquidation (currently anticipated to be no more than approximately $100,000) and has contractually agreed not to seek repayment for such expenses.

If we are unable to complete an initial Business Combination and expend all of the net proceeds of our Initial Public Offering, other than the proceeds deposited in the Trust Account, and without taking into account interest, if any, earned on the Trust Account, the per-share redemption price would be $10.58 as of December 31, 2023. As discussed above, the proceeds deposited in the Trust Account could become subject to claims of our creditors that are in preference to the claims of Public Stockholders.

Our Public Stockholders shall be entitled to receive funds from the Trust Account only in the event of our failure to complete a Business Combination within the Combination Period, if the Public Stockholders seek to have us redeem or purchase their respective Public Shares upon a Business Combination that is actually completed by us or upon certain amendments to our Amended and Restated Charter prior to consummating an initial Business Combination. In no other circumstances shall a Public Stockholder have any right or interest of any kind to or in the Trust Account.

If we are forced to file a bankruptcy case or an involuntary bankruptcy case is filed against us that is not dismissed, the proceeds held in the Trust Account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders.

If we are forced to file a bankruptcy case or an involuntary bankruptcy case is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover all amounts received by our stockholders. Furthermore, because we intend to distribute the proceeds held in the Trust Account to our Public Stockholders promptly following the expiration of the Combination Period, this may be viewed or interpreted as giving preference to our Public Stockholders over any potential creditors with respect to access to or distributions from our assets.

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Furthermore, our Board may be viewed as having breached their fiduciary duties to our creditors and/or may have acted in bad faith, and thereby exposing itself and our Company to claims of punitive damages, by paying Public Stockholders from the Trust Account prior to addressing the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons.

Amended and Restated Certificate of Incorporation

Our Amended and Restated Charter contains certain requirements and restrictions relating to our Initial Public Offering that apply to us until the consummation of our initial Business Combination. These provisions cannot be amended without the approval of a majority of our stockholders. If we seek to amend any provisions of our Amended and Restated Charter that would affect our Public Stockholders’ ability to redeem or sell their Public Shares to us in connection with a Business Combination as described herein or affect the substance or timing of our obligation to redeem 100% of our Public Shares if we do not complete a Business Combination by the end of the Combination Period, or to such extended date as may be approved by our stockholders to consummate an initial Business Combination, we will provide dissenting Public Stockholders with the opportunity to redeem their Public Shares in connection with any such vote. This redemption right will apply in the event of the approval of any such amendment, whether proposed by our Sponsor, any executive officer, director or any other person. Pursuant to the Letter Agreement, our Sponsor, officers and directors have agreed to waive any redemption rights with respect to any Founder Shares and any Public Shares they may hold in connection with any vote to amend our Amended and Restated Charter. Specifically, our Amended and Restated Charter provides, among other things, that:

Competition

In identifying, evaluating and selecting a target business, we have encountered and may continue to encounter intense competition from other entities having a business objective similar to ours, including other blank check companies. Many of these entities are well established and have extensive experience identifying and effecting Business Combinations directly or through affiliates. Many of these competitors possess greater technical, human and other resources than us and our financial resources are relatively limited when contrasted with those of many of these competitors. While there may be numerous potential target businesses that we could acquire with the net proceeds of our Initial Public Offering, our ability to compete in acquiring certain sizable target businesses may be limited by our available financial resources.

The following also may not be viewed favorably by certain target businesses:

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Any of these factors may place us at a competitive disadvantage in successfully negotiating a Business Combination. Our Management believes, however, that our status as a public entity and potential access to the United States public equity markets may give us a competitive advantage over privately held entities having a similar business objective as ours in acquiring a target business with significant growth potential on favorable terms. If we succeed in effecting a Business Combination, there will be, in all likelihood, intense competition from competitors of the target business.

If we succeed in effecting a Business Combination, there will be, in all likelihood, intense competition from competitors of the target business. We cannot assure you that, subsequent to a Business Combination, we will have the resources or ability to compete effectively.

Employees

We have two executive officers. These individuals are not obligated to devote any specific number of hours to our matters and devote only as much time as they deem necessary to our affairs. The amount of time they devote in any time period is dependent on the stage of the Business Combination process we are in. Accordingly, once a suitable target business to acquire has been located, such as Infinite Reality, Management may spend more time investigating such target business and negotiating and processing the Business Combination (and consequently spend more time on our affairs) than had been spent prior to locating a suitable target business. Our executive officers devote such amount of time as they reasonably believe is necessary to our business. We do not intend to have any full-time employees prior to the consummation of a Business Combination.

Periodic Reporting and Audited Financial Statements

We have registered our Units, Common Stock and Warrants under the Exchange Act and have reporting obligations, including the requirement that we file annual, quarterly and current reports with the SEC. In accordance with the requirements of the Exchange Act, our annual reports, such as this Report, will contain financial statements audited and reported on by our independent registered public accountants.

We will provide stockholders with audited financial statements of the prospective target business as part of any proxy solicitation materials or tender offer documents sent to stockholders to assist them in assessing the target business, such as the Infinite Reality Registration Statement. These financial statements will need to be prepared in accordance with or reconciled to GAAP or IFRS as promulgated by the International Accounting Standards Board. We cannot assure you that any particular target business identified by us as a potential acquisition candidate will have the necessary financial statements. To the extent that this requirement cannot be met, we may not be able to acquire the proposed target business.

Section 404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls. As long as we maintain our status as an emerging growth company, we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a target company with which we seek to complete our Business Combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition or merger.

We will remain an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.

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In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (i) the last day of the fiscal year (x) following March 25, 2026, the fifth anniversary of the completion of our Initial Public Offering, (y) in which we have total annual gross revenue of at least $1.235 billion, or (z) in which we are deemed to be a large accelerated filer, which means the market value of our Common Stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (ii) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. References herein to “emerging growth company” shall have the meaning associated with it in the JOBS Act.

Additionally, we are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our Common Stock held by non-affiliates equals or exceeds $250 million as of the end of that year’s second fiscal quarter, or (2) our annual revenues equals or exceeds $100 million during such completed fiscal year and the market value of our Common Stock held by non-affiliates equals or exceeds $700 million as of the end of that year’s second fiscal quarter.

Item 1A.      Risk Factors.

As a smaller reporting company under Rule 12b-2 of the Exchange Act, we are not required to include risk factors in this Report. However, the following is a partial list of material risks, uncertainties and other factors that could have a material effect on us and our operations:

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We have received notices from Nasdaq advising we are not in compliance with the Nasdaq Listing Rules, which require that (i) a SPAC complete one or more Business Combinations within 36 months of the effectiveness of the registration statement filed in connection with its initial public offering and (ii) the timely filing of all required periodic financial reports with the SEC. If we cannot regain compliance, our securities will be subject to delisting and the liquidity and the trading price of our securities could be adversely affected.

On March 26, 2024, we received a notice from the Listing Qualifications Department of Nasdaq that we are not in compliance with the Nasdaq Listing Rule IM-5101-2, which requires that a SPAC complete one or more Business Combinations within 36 months

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of the effectiveness of the registration statement filed in connection with its initial public offering. Since the IPO Registration Statement became effective on March 22, 2021, we were required to complete an initial Business Combination by no later than March 22, 2024. The Listing Rule IM-5101-2 also provides that failure to comply with this requirement will result in the Nasdaq staff issuing a Staff Delisting Determination under Rule 5810 to delist our securities.

The Nasdaq staff has advised that our securities would be subject to delisting unless we timely request a hearing before the Panel. Accordingly, on April 2, 2024, we timely requested such hearing, which was held on May 23, 2024. The hearing request stayed any suspension or delisting action pending the completion of the hearing and the expiration of any additional extension period granted by the Panel following the hearing. There can be no assurance that the hearing before the Panel will be successful.

This Nasdaq notice does not impact our obligation to file periodic reports with the SEC under applicable federal securities laws. On April 24, 2024, we received a letter from the Listing Qualifications Department of Nasdaq indicating that we were not in compliance with Nasdaq Listing Rule 5250(c)(1), which requires the timely filing of all required periodic financial reports with the SEC due to the late filing of this Report. On May 23, 2024, we received an additional notice from the Listing Qualifications Department of Nasdaq indicating that, in addition to this Report, our failure to timely file the Form 10-Q for the quarterly period ended March 31, 2024 with the SEC, in contravention of Nasdaq Listing Rule 5250(c)(1), could serve as an additional basis for delisting from Nasdaq. We addressed our plan to evidence compliance with Nasdaq Listing Rule 5250(c)(1) at the hearing before the Panel on May 23, 2024.

If Nasdaq delists our securities from trading on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:

Cyber incidents or attacks directed at us or third parties could result in information theft, data corruption, operational disruption and/or financial loss.

We depend on digital technologies, including information systems, infrastructure and cloud applications and services, including those of third parties with whom we may deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data. As an early-stage company without significant investments in data security protection, we may not be sufficiently protected against such occurrences. We also lack sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents. Any of these occurrences, or a combination of them, could have material adverse consequences on our business and lead to financial loss.

Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial Business Combination, and results of operations.

We are subject to laws and regulations enacted by national, regional and local governments. In particular, we are required to comply with certain SEC and other legal requirements and numerous complex tax laws. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to negotiate and complete our initial Business Combination, and results of operations.

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On January 24, 2024, the SEC adopted the 2024 SPAC Rules requiring, among other matters, (i) additional disclosures relating to SPAC Business Combination transactions; (ii) additional disclosures relating to dilution and to conflicts of interest involving Sponsors and their affiliates in both SPAC Initial Public Offerings and Business Combination transactions; (iii) additional disclosures regarding projections included in SEC filings in connection with proposed Business Combination transactions; and (iv) the requirement that both the SPAC and its target company be co-registrants for Business Combination registration statements

In addition, the SEC’s adopting release provided guidance describing circumstances in which a SPAC could become subject to regulation under the Investment Company Act, including its duration, asset composition, business purpose, and the activities of the SPAC and its management team in furtherance of such goals.

Compliance with the 2024 SPAC Rules and related guidance may (i) increase the costs of and the time needed to negotiate and complete an initial Business Combination and (ii) constrain the circumstances under which we could affect our ability to complete an initial Business Combination.

If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete our initial Business Combination.

The SEC‘s adopting release with respect to the 2024 SPAC Rules provided guidance relating to the potential status of SPACs as investment companies subject to regulation under the Investment Company Act and the regulations thereunder. Whether a SPAC is an investment company is dependent on specific facts and circumstances and we can give no assurance that a claim will not be made that we have been operating as an unregistered investment company.

If we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including (i) restrictions on the nature of our investments; and (ii) restrictions on the issuance of securities, each of which may make it difficult for us to complete our initial Business Combination.

In addition, we may have imposed upon us burdensome requirements, including: (i) registration as an investment company; (ii) adoption of a specific form of corporate structure; and (iii) reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations.

In order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business other than investing, reinvesting or trading in securities and that our activities do not include investing, reinvesting, owning, holding or trading “investment securities” constituting more than 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. We are mindful of the SEC’s investment company definition and guidance and intend to complete an initial Business Combination with an operating business, and not with an investment company, or to acquire minority interests in other businesses exceeding the permitted threshold.

We do not believe that our business activities will subject us to the Investment Company Act. To this end, the proceeds held in the Trust Account were initially invested only in U.S. government treasury obligations with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations; the holding of these assets in this form is intended to be temporary and for the sole purpose of facilitating the intended Business Combination. To mitigate the risk that we might be deemed to be an investment company for purposes of the Investment Company Act, which risk increases the longer that we hold investments in the Trust Account, on April 11, 2023, we instructed Continental, as trustee of the Trust Account, to liquidate the investments held in the Trust Account and instead to hold the funds in the Trust Account in cash or in an interest bearing demand deposit account at a bank.

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Pursuant to the Trust Agreement, Continental is not permitted to invest in securities or assets other than as described above. By restricting the investment of the proceeds to these instruments, and by having a business plan targeted at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a merchant bank or private equity fund), we intended to avoid being deemed an “investment company” within the meaning of the Investment Company Act. Our Initial Public Offering was not intended for persons who were seeking a return on investments in government securities or investment securities. The Trust Account is intended solely as a temporary depository for funds pending the earliest to occur of: (i) the completion of our initial Business Combination; (ii) the redemption of any Public Shares properly submitted in connection with a stockholder vote to amend our Amended and Restated Charter (x) in a manner that would affect the substance or timing of our obligation to redeem 100% of our Public Shares if we do not complete our initial Business Combination within the Combination Period; or (y) with respect to any other provision relating to the rights of holders of shares of our Class A Common Stock or pre-initial Business Combination activity; or (iii) absent an initial Business Combination within the Combination Period, our return of the funds held in the Trust Account to our Public Stockholders as part of our redemption of the Public Shares.

We are aware of litigation claiming that certain SPACs should be considered investment companies. Although we believe that these claims are without merit, we cannot guarantee that we will not be deemed to be an investment company and thus subject to the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds and may hinder our ability to complete an initial Business Combination or may result in our liquidation. If we are unable to complete our initial Business Combination, our Public Stockholders may receive only approximately $10.58 per Public Share upon the liquidation of our Trust Account and our Warrants will expire worthless.

For additional risks relating to our operations, other than as set forth above, see the section titled “Risk Factors” contained in our  (i) IPO Registration Statement, (ii) 2021 Annual Report and 2022 Annual Report, (iii) Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2021, September 30, 2021, March 31, 2022, June 30, 2022, September 30, 2022, March 31, 2023 and September 30, 2023, as filed with the SEC on May 24, 2021, November 16, 2021, May 16, 2022, August 8, 2022, November 10, 2022, May 19, 2023 and November 21, 2023, respectively, and  (iv) Definitive Proxy Statement on Schedule 14A as filed with the SEC on February 27, 2024. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risks could arise that may also affect our business or ability to consummate an initial Business Combination. We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future filings with the SEC.

For risks related to Infinite Reality and the Infinite Reality Business Combination, please see the section titled “Risk Factors” in the Infinite Reality Registration Statement, once filed with the SEC.

Item 1B.      Unresolved Staff Comments.

Not applicable.

Item 1C.      Cybersecurity.

As a blank check company, we do not have any operations and our sole business activity has been to search for and consummate a Business Combination. However, because we have investments in our Trust Account and bank deposits and we depend on the digital technologies of third parties, we and third parties may be subject to attacks on or security breaches in our or their systems. Because of our reliance on the technologies of third parties, we also depend upon the personnel and the processes of third parties to protect against cybersecurity threats, and we have no personnel or processes of our own for this purpose. In the event of a cybersecurity incident impacting us, the Management Team will report to the Board of Directors and provide updates on the Management Team’s incident response plan for addressing and mitigating any risks associated with such an incident. As an early-stage company without significant investments in data security protection, we may not be sufficiently protected against such occurrences. We also lack sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have material adverse consequences on our business and lead to financial loss.

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Item 2.      Properties.

Our executive offices are located at 121 High Street, Floor 3, Boston, MA 02110, and our telephone number is (617) 894-3057. The cost for our use of this space is included in the $10,000 per month fee we pay to our Sponsor for office space, administrative and shared personnel support services pursuant to the Administrative Support Agreement. We consider our current office space adequate for our current operations.

Item 3.      Legal Proceedings.

To the knowledge of our Management Team, there is no material litigation currently pending or contemplated against us, any of our officers or directors in their capacity as such or against any of our property.

​

Item 4.      Mine Safety Disclosures.

Not applicable.

​

​

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PART II

Item 5.      Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities.

(a)Market Information

Our Units, Public Shares and Public Warrants are each traded on the Nasdaq Capital Market under the symbols “NBSTU”, “NBST”, and “NBSTW”, respectively. Our Units commenced public trading on March 22, 2021, and our Public Shares and Public Warrants commenced separate public trading on April 16, 2021.

On March 26, 2024, we received a notice from the Listing Qualifications Department of Nasdaq that we are not in compliance with the Nasdaq Listing Rule IM-5101-2, which requires that a SPAC complete one or more Business Combinations within 36 months of the effectiveness of the registration statement filed in connection with its initial public offering. Since the IPO Registration Statement became effective on March 22, 2021, we were required to complete an initial Business Combination by no later than March 22, 2024. Nasdaq Listing Rule IM-5101-2 also provides that failure to comply with this requirement will result in the Nasdaq staff issuing a Staff Delisting Determination under Rule 5810 to delist our securities.

The Nasdaq staff has advised that our securities would be subject to delisting unless we timely request a hearing before the Panel. Accordingly, on April 2, 2024, we timely requested such hearing, which was held on May 23, 2024. The hearing request stayed any suspension or delisting action pending the completion of the hearing and the expiration of any additional extension period granted by the Panel following the hearing. There can be no assurance that the hearing before the Panel will be successful.

The Nasdaq notice does not impact our obligation to file periodic reports with the SEC under applicable federal securities laws. On April 24, 2024, we received a letter from the Listing Qualifications Department of Nasdaq indicating that we were not in compliance with Nasdaq Listing Rule 5250(c)(1), which requires the timely filing of all required periodic financial reports with the SEC due to the late filing of this Report. On May 23, 2024, we received an additional notice from the Listing Qualifications Department of Nasdaq indicating that, in addition to this Report, our failure to timely file the Form 10-Q for the quarterly period ended March 31, 2024 with the SEC, in contravention of Nasdaq Listing Rule 5250(c)(1), could serve as an additional basis for delisting from Nasdaq. We addressed our plan to evidence compliance with Nasdaq Listing Rule 5250(c)(1) at the hearing before the Panel on May 23, 2024.

(b)Holders

On June 5, 2024, there were three holders of record of our Units, five holders of record of shares of our Common Stock and one holder of record of our Warrants.

(c)Dividends

We have not paid any cash dividends on our Common Stock to date and do not intend to pay cash dividends prior to the completion of our initial Business Combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of our initial Business Combination. The payment of any cash dividends subsequent to our initial Business Combination will be within the discretion of our Board of Directors at such time. In addition, our Board of Directors is not currently contemplating and does not anticipate declaring any stock dividends in the foreseeable future. Further, if we incur any indebtedness in connection with our initial Business Combination, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith.

(d)Securities Authorized for Issuance Under Equity Compensation Plans

None.

(e)Recent Sales of Unregistered Securities

None.

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(f)Use of Proceeds from the Initial Public Offering

For a description of the use of proceeds generated in our Initial Public Offering and Private Placement, see Part II, Item 2 of our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021, as filed with the SEC on May 24, 2021. There has been no material change in the planned use of proceeds from our Initial Public Offering and Private Placement as described in the IPO Registration Statement. The specific investments in our Trust Account may change from time to time.

On April 11, 2023, we instructed Continental to liquidate the investments held in the Trust Account and instead to hold the funds in the Trust Account in an interest-bearing demand deposit account at JPMorgan Chase, N.A., with Continental continuing to act as trustee, until the earlier of the consummation of our initial Business Combination or our liquidation. As a result, following the liquidation of investments in the Trust Account, the remaining proceeds from the Initial Public Offering and Private Placement are no longer invested in U.S. government securities or money market funds invested in U.S. government securities.

(g)Purchases of Equity Securities by the Issuer and Affiliated Purchasers

On September 22, 2023, we held the Second Special Meeting and our stockholders approved the Second Extension Amendment Proposal, which extended the date by which we must consummate a Business Combination from September 25, 2023 to March 25, 2024 (or such earlier date as determined by the Board). In connection with the vote to approve the Second Extension Amendment Proposal, Public Stockholders holding 3,060,282 Public Shares properly exercised their right to redeem such shares for a pro rata portion of the Trust Account. We paid cash in the aggregate amount of approximately $32.00 million, or approximately $10.46 per share, to redeeming stockholders in the Second Special Meeting Redemptions on October 18, 2023.

​

On March 20, 2024, we held the Third Special Meeting and our stockholders approved the Third Extension Amendment Proposal, which extended the date by which we must consummate a Business Combination from March 25, 2024 to September 25, 2024 (or such earlier date as determined by the Board). In connection with the vote to approve the Third Extension Amendment Proposal, Public Stockholders holding 908,496 Public Shares properly exercised their right to redeem such shares for a pro rata portion of the Trust Account. We paid cash in the aggregate amount of approximately $9.77 million, or approximately $10.75 per share, to redeeming stockholders in the Third Special Meeting Redemptions.

​

The following table contains monthly information about the repurchases of our equity securities for the three months ended December 31, 2023:

​

​

​

Item 6.      [Reserved]

​

Item 7.      Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Report.

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Overview

We are a blank check company formed under the laws of the State of Delaware on November 6, 2020 for the purpose of effecting a Business Combination. We intend to effectuate our Business Combination using cash from the proceeds of the Initial Public Offering and the Private Placement, our capital stock, debt or a combination of cash, stock and debt.

All activity through December 31, 2023 related to our formation, Initial Public Offering, and search for and consummation of an initial Business Combination.

Infinite Reality Business Combination

On December 12, 2022, we entered into the Infinite Reality Merger Agreement with Pubco, the Merger Subs, consisting of Purchaser Merger Sub and Infinite Reality Merger Sub, and Infinite Reality.

The Infinite Reality Merger Agreement Parties entered into the (i) First Merger Agreement Amendment on May 15, 2023, (ii) Second Merger Agreement Amendment on July 21, 2023 and (iii) Third Merger Agreement Amendment on February 26, 2024.

Pursuant to the terms of the Infinite Reality Merger Agreement, (i) under the Purchaser Merger, the Purchaser Merger Sub will merge with and into our Company, with our Company continuing as the surviving entity, (ii) under the Infinite Reality Merger, the Infinite Reality Merger Sub will merge with and into Infinite Reality, with Infinite Reality continuing as the surviving entity and (iii) following the Mergers, our Company and Infinite Reality will become direct wholly-owned subsidiaries of Pubco, and Pubco will become a publicly traded company.

For a full description of the Infinite Reality Merger Agreement and the proposed Infinite Reality Business Combination, please see “Item 1. Business”.

Recent Developments

Third Merger Agreement Amendment

On February 26, 2024, the Infinite Reality Merger Agreement Parties entered into the Third Merger Agreement Amendment to provide for, among other things, (i) the addition of a new Section 6.25 providing for the delivery by Infinite Reality of certain deliverables by the deadlines set forth therein, (ii) the addition of a new Section 8.1(j) granting us the right to terminate the Infinite Reality Merger Agreement if Infinite Reality breaches Section 6.25 or fails to meet any of the deadlines set forth therein, (iii) the amendment of Section 8.2(d) providing for the payment by Infinite Reality to us of certain reimbursement fees in the event of a termination pursuant to Section 8.1(j), and (iv) an amendment to the definition of “Monthly Extension Fee.”

Third Special Meeting

On March 20, 2024, we held the Third Special Meeting and approved, the Third Extension Amendment Proposal, which extended the date by which we must consummate a Business Combination from March 25, 2024 to September 25, 2024 (or such earlier date as determined by the Board). In connection with the vote to approve the Third Extension Amendment Proposal, stockholders holding 908,496 Public Shares exercised their right to redeem such shares for a pro rata portion of the Trust Account. We paid cash in the aggregate amount of approximately $9.77 million, or approximately $10.75 per share to redeeming stockholders in the Third Special Meeting Redemptions. Following the Third Special Meeting Redemptions, we had approximately $12.16 million in the Trust Account.

In connection with the approval of the Third Extension Amendment Proposal, Infinite Reality agreed to contribute the Monthly Extension Fee to us, which amounted to $0.03 for each Public Share that was not redeemed in the Third Special Meeting Redemptions, or $33,932.22 (commencing on March 23, 2024 and on the 23rd day of each subsequent month) until September 25, 2024, or portion thereof, that is needed to complete an initial Business Combination.

As of the date of this Report, in 2024, an aggregate of approximately $0.20 million has been paid by Infinite Reality as Monthly Extension Fees.

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Nasdaq Notices

On March 26, 2024, we received a notice from the Listing Qualifications Department of Nasdaq that we are not in compliance with the Nasdaq Listing Rule IM-5101-2, which requires that a SPAC complete one or more Business Combinations within 36 months of the effectiveness of the registration statement filed in connection with its initial public offering. Since the IPO Registration Statement became effective on March 22, 2021, we were required to complete an initial Business Combination by no later than March 22, 2024. Nasdaq Listing Rule IM-5101-2 also provides that failure to comply with this requirement will result in the Nasdaq staff issuing a Staff Delisting Determination under Rule 5810 to delist our securities.

The Nasdaq staff has advised that our securities would be subject to delisting unless we timely request a hearing before the Panel. Accordingly, on April 2, 2024, we timely requested such hearing, which was held on May 23, 2024. The hearing request stayed any suspension or delisting action pending the completion of the hearing and the expiration of any additional extension period granted by the Panel following the hearing. There can be no assurance that the hearing before the Panel will be successful.

The Nasdaq notice does not impact our obligation to file periodic reports with the SEC under applicable federal securities laws. On April 24, 2024, we received a letter from the Listing Qualifications Department of Nasdaq indicating that we were not in compliance with Nasdaq Listing Rule 5250(c)(1), which requires the timely filing of all required periodic financial reports with the SEC due to the late filing of this Report. On May 23, 2024, we received an additional notice from the Listing Qualifications Department of Nasdaq indicating that, in addition to this Report, our failure to timely file the Form 10-Q for the quarterly period ended March 31, 2024 with the SEC, in contravention of Nasdaq Listing Rule 5250(c)(1), could serve as an additional basis for delisting from Nasdaq. We addressed our plan to evidence compliance with Nasdaq Listing Rule 5250(c)(1) at the hearing before the Panel on May 23, 2024.

Results of Operations

We have neither engaged in any operations nor generated any revenues to date. Our only activities from commencement of operations through December 31, 2023 were organizational activities, the Initial Public Offering, and the search for a prospective Business Combination target and consummation of an initial Business Combination. We do not expect to generate any operating revenues until after the completion of our Business Combination. We generate non-operating income in the form of interest income or dividend income on marketable securities 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 for due diligence related to the search for potential target companies.

For the year ended December 31, 2023, we had a net income of approximately $0.10 million, which consisted of dividend income of approximately $2.66 million and offset by franchise tax expense of $0.16 million, income tax expense of $0.68 million and operating costs of approximately $1.72 million.

For the year ended December 31, 2022, we had a net loss of approximately $1.29 million, which consisted of dividend income of approximately $1.85 million and change in fair value of warrant liabilities of approximately $0.11 million, franchise tax expense of $0.20 million, income tax expense of $0.41 million and operating costs of approximately $2.64 million.

Factors That May Adversely Affect our Results of Operations

Our results of operations and our ability to complete an initial Business Combination may be adversely affected by various factors that could cause economic uncertainty and volatility in the financial markets, many of which are beyond our control. Our business could be impacted by, among other things, downturns in the financial markets or in economic conditions, increases in oil prices, inflation, increases in interest rates, supply chain disruptions, declines in consumer confidence and spending, public health considerations, and geopolitical instability, such as the military conflicts in Ukraine and the Middle East. We cannot at this time predict the likelihood of one or more of the above events, their duration or magnitude or the extent to which they may negatively impact our business and our ability to complete an initial Business Combination.

Liquidity, Capital Resources and Going Concern

Until the consummation of the Initial Public Offering, our only source of liquidity was an initial purchase of Common Stock by the Sponsor and EBC and loans from the Sponsor under the IPO Promissory Note.

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On March 25, 2021, we consummated the Initial Public Offering of 12,000,000 Units, at a price of $10.00 per Unit, generating gross proceeds of $120.00 million. Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 390,000 Private Units at a price of $10.00 per Private Unit in the Private Placement to the Sponsor and EBC, generating gross proceeds of $3.90 million. On March 30, 2021, the underwriters of the Initial Public Offering exercised the over-allotment option in part and purchased an additional 843,937 Units, generating gross proceeds of approximately $8.44 million. In connection with the underwriters’ partial exercise of the over-allotment option, we sold an additional 16,879 Private Units at a price of $10.00 per Private Unit in the Private Placement to the Sponsor and EBC, generating gross proceeds of approximately $0.17 million.

Following the Initial Public Offering and the Private Placement, a total of approximately $128.44 million was placed in the Trust Account.

We incurred approximately $3.00 million in transaction costs, including approximately $2.57 million of underwriting fees and approximately $0.43 million of other offering costs.

In connection with the vote to approve the First Extension Amendment Proposal, approximately $78.77 million was removed from the Trust Account on April 3, 2023, due to the redemption of an aggregate of 7,744,085 Public Shares held by Public Stockholders, at a redemption price of approximately $10.17 per share. Also, in connection with the vote to approve the Second Extension Amendment Proposal, approximately $32.00 million was removed from the Trust Account on October 18, 2023, due to the redemption of an aggregate of 3,060,282 Public Shares held by Public Stockholders, at a redemption price of approximately $10.46 per share. As of December 31, 2023, following the First Special Meeting Redemptions and the Second Special Meeting Redemptions, we had approximately $21.58 million in the Trust Account.

We intend to use substantially all of the funds held in the Trust Account, including any amounts representing income earned on the Trust Account, to complete the Business Combination. To the extent that the capital stock or debt is used, in whole or in part, as consideration to complete the Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

As of December 31, 2023 and 2022, we had cash of approximately $1.0 million and $0.1 million, respectively, outside of the Trust Account. We use the funds held outside the Trust Account and any proceeds from borrowings primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination, including for the Infinite Reality Business Combination.

Since the completion of the Initial Public Offering and through December 31, 2023, we withdrew $1.9 million from the Trust Account to pay liabilities related to the income and Delaware franchise taxes. Through December 31, 2023, we remitted $1.0 million to the respective tax authorities. As of the balance sheet date, $0.9 million was held in our operating bank account (inclusive of $0.9 million overdrawn from the Trust Account, held for settlement of tax obligations).

In order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor or certain of our officers and directors may, but are not obligated to, loan us Working Capital Loans as may be required. If we complete a Business Combination, we may repay such Working Capital Loans out of the proceeds of the Trust Account released to us. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such Working Capital Loans, but no proceeds from the Trust Account would be used for such repayment. Up to $1.50 million of such Working Capital Loans may be convertible into units at a price of $10.00 per unit at the option of the lender. The units would be identical to the Private Units.

On May 3, 2022, we issued the WCL Promissory Note to the Sponsor in the principal amount of $0.4 million to the Sponsor. On August 30, 2022, September 6, 2022 and September 21, 2022, there were additional drawdowns of approximately $0.04 million, $0.11 million and $0.02 million, respectively. We must make drawdown requests in amounts no less than $10,000 pursuant to the WCL Promissory Note.

On March 15, 2023, we amended and restated the WCL Promissory Note in its entirety to (i) increase the principal amount thereunder from $0.4 million to $0.9 million and (ii) remove the right of the holder of the WCL Note to convert all or any portion of the

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unpaid principal balance of the WCL Promissory Note into the units and related registration rights for such units (including underlying securities). As amended, the WCL Promissory Note is non-interest bearing and is payable on the earlier of (i) the date on which we consummate an initial Business Combination or (ii) the date that our winding up is effective.

On March 22, 2023, we amended and restated the WCL Promissory Note to increase the principal amount from up to $0.9 million to up to $2.1 million, pursuant to which the Sponsor agreed to loan to us up to $2.1 million.

In February 2023, $70,000 was drawn down under the WCL Promissory Note. In April 2023, $49,140 was drawn down under the WCL Promissory Note. In May 2023, an additional aggregate of $221,449 was drawn down under the WCL Promissory Note. In June 2023, an additional aggregate of $83,500 was drawn down, and an aggregate of $102,665 was refunded, under the WCL Promissory Note. In July 2023, $55,221 was drawn down under the WCL Promissory Note. In August 2023, an additional aggregate of $61,616 was drawn down under the WCL Promissory Note. In September 2023, an additional aggregate of $88,430 was drawn down under the WCL Promissory Note. In October 2023, $3,000 was drawn down under the WCL Promissory Note. In November 2023, an additional aggregate of $97,536 was drawn down, and an aggregate of $8,000 was refunded, under the WCL Promissory Note.

At December 31, 2023 and December 31, 2022, approximately $1.02 million and $0.40 million were outstanding under the WCL Promissory Note, respectively.

In connection with our assessment of going concern considerations in accordance with FASB ASC Subtopic 205-40, “Presentation of Financial Statements — Going Concern”, we have until September 25, 2024 to consummate a Business Combination. If a Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of our Company. Although we intend to consummate a Business Combination on or before September 25, 2024, it is uncertain whether we will be able to consummate a Business Combination by this time. Management has determined that the mandatory liquidation, should a Business Combination not occur, and potential subsequent dissolution, as well as the potential for is to have insufficient funds available to operate our business prior to a Business Combination, raise substantial doubt about our ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should we be required to liquidate after September 25, 2024.

Trust Account Investment

On April 11, 2023, we instructed Continental to liquidate the investments held in the Trust Account and instead to hold the funds in the Trust Account in an interest-bearing demand deposit account at JPMorgan Chase, N.A., with Continental continuing to act as trustee, until the earlier of the consummation of our initial Business Combination or our liquidation. As a result, following the liquidation of investments in the Trust Account, the remaining proceeds from the Initial Public Offering and Private Placement are no longer invested in U.S. government securities or money market funds invested in U.S. government securities.

Initial Contribution and Monthly Extension Fees

In connection with the approval of the First Extension Amendment Proposal, the Sponsor or its designees agreed to contribute to us, under the WCL Promissory Note, (i) the Initial Contribution, plus, (ii) an aggregate of $200,000 per month (commencing on June 23, 2023 and on the 23rd day of each subsequent month) until September 25, 2023, or portion thereof, that was needed to complete an initial Business Combination, which amount was to be deposited into the Trust Account.

On March 24, 2023, the Sponsor made the Initial Contribution of $600,000, which was deposited into the Trust Account. On June 26, 2023, $200,000 was deposited into the Trust Account, which was comprised of a $100,000 payment from the Sponsor, bringing the balance under the under the WCL Promissory Note to $0.7 million, and a $100,000 payment from Infinite Reality. The remaining Monthly Extension Fees in connection with the approval of the First Extension Amendment were paid by Infinite Reality pursuant to the Second Merger Agreement Amendment.

In connection with the approval of the Second Extension Amendment Proposal, Infinite Reality agreed to contribute the Monthly Extension Fee to us, which amounted to $0.025 for each Public Share that was not redeemed in the Second Special Meeting Redemptions, or $50,989.25 (commencing on September 23, 2023 and on the 23rd day of each subsequent month) until March 25, 2024, or portion thereof, that was needed to complete an initial Business Combination. The Monthly Extension Fees in connection with the approval of the Second Extension Amendment were paid by Infinite Reality pursuant to the Second Merger Agreement Amendment. Payments received from Infinite Reality have been treated as equity contribution.

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Off-Balance Sheet Arrangements

We had no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2023. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than described below.

Business Combination Marketing Agreement

We engaged EBC as an advisor in connection with our Business Combination to (i) assist us in holding meetings with our stockholders to discuss the potential Business Combination and the target business’ attributes, (ii) introduce us to potential investors that are interested in purchasing our securities in connection with our initial Business Combination, (iii) assist us in obtaining stockholder approval for the Business Combination and (iv) assist us with our press releases and public filings in connection with the Business Combination. We will pay EBC a cash fee of up to $4.2 million for such services upon the consummation of the initial Business Combination (exclusive of any applicable finders’ fees which might become payable); provided that up to 30% of the fee may be allocated at our sole discretion to other FINRA members that assist us in identifying or consummating an initial Business Combination. We will also pay EBC a cash fee of up to 1% of the gross proceeds from the Initial Public Offering as a fee for introducing us to target companies for an initial Business Combination.

Registration Rights

Pursuant to the Registration Rights Agreement, the holders of the (i) Founder Shares, (ii) Representative Shares, (iii) Private Units (and underlying securities) and (iv) any units issued in payment of Working Capital Loans made to us (and underlying securities) are entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that we register such securities.

The holders of a majority of the Representative Shares, Private Units and units issued in payment of Working Capital Loans made to us (or underlying securities) can elect to exercise these registration rights at any time after we consummate a Business Combination. Notwithstanding anything to the contrary, EBC. may only make a demand on one occasion and only during the five-year period beginning on the effective date of the IPO Registration Statement. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to consummation of a Business Combination; provided, however, that EBC may participate in a “piggy-back” registration only during the seven-year period beginning on the effective date of the IPO Registration Statement.

The Registration Rights Agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering our securities. We will bear the expenses incurred in connection with the filing of any such registration statements.

Underwriting Agreement

We granted the underwriters of the Initial Public Offering a 45-day option from the date of the Initial Public Offering to purchase up to 1,800,000 additional Units to cover over-allotments, if any, at the public offering price less the underwriting discounts and commissions.

The underwriters were entitled to an underwriting discount of $0.20 per Unit, or $2.40 million in the aggregate, paid at the closing of the Initial Public Offering. On March 30, 2021, the underwriters partially exercised their over-allotment option to purchase an additional 843,937 Units at $10.00 per Unit. In connection with the underwriters’ partial exercise of the over-allotment option on March 30, 2021, the underwriters were paid an additional cash underwriting fee of approximately $0.17 million.

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Administrative Support Agreement

We have agreed to pay the Sponsor a total of up to $0.01 million per month, from the effective date of the IPO Registration Statement, for office space, utilities and secretarial and administrative support pursuant to the Administrative Support Agreement. Services will terminate upon the earlier of (i) the consummation of a Business Combination or (ii) our liquidation. For the year ended December 31, 2023, we incurred and accrued $0.12 million for these services. For the year ended December 31, 2022, we incurred $0.12 million for these services, out of which $0.03 million are accrued. Such amounts are included in the operating costs on the statements of operations presented in the financial statements contained elsewhere in this Report.

Critical Accounting Estimates

The preparation of financial statements and related disclosures in conformity with GAAP 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.

Net Profit (Loss) Per Share of Common Stock

We comply with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net profit (loss) per share of Common Stock is computed by dividing net profit (loss) attributable to common stockholders by the weighted average number of shares of Common Stock outstanding during the period, excluding Common Stock subject to forfeiture. We apply the two-class method in calculating earnings per share. The calculation of diluted profit (loss) per share of Common Stock does not consider the effect of the Public Warrants since the exercise of the Public Warrants are contingent upon the occurrence of future events and the inclusion of such Public Warrants would be anti-dilutive.

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Warrants

We do not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. We evaluate all of our financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to FASB ASC Topic 480, “Distinguishing Liabilities from Equity (“ASC 480”) and FASB ASC Subtopic 815-15, “Embedded Derivatives” (“ASC 815-15”).

We account for the Warrants, as either equity or liability-classified instruments based on an assessment of the specific terms of the Warrants and the applicable authoritative guidance in FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The assessment considers whether the Warrants meet all of the requirements for equity classification under ASC 815, including whether the Warrants are indexed to its own Common Stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of its control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the Warrants and as of each subsequent quarterly period end date while the Warrants are outstanding.

For issued or modified Warrants that meet all of the criteria for equity classification, such Warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified Warrants that do not meet all the criteria for equity classification, such Warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of liability-classified Warrants are recognized as a non-cash gain or loss on the statements of operations.

The Private Warrants are recognized as derivative liabilities in accordance with ASC 815-40. Accordingly, we recognize the Warrant instruments as liabilities at fair value and adjust the instruments to fair value at each reporting period. The liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statements of operations presented in the financial statements contained elsewhere in this Report. The fair value of the Private Warrants was initially measured at fair value using a Monte Carlo simulation model and subsequently, the fair value of the Private Warrants have been estimated using a Monte Carlo simulation model each measurement date.

Common Stock Subject to Possible Redemption

We account for the Common Stock subject to possible redemption in accordance with the guidance in ASC 480. Shares of Common Stock subject to mandatory redemption (if any) are classified as a liability instrument and are measured at fair value. Conditionally redeemable shares of Common Stock (including shares of Common Stock that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) are classified as temporary equity. At all other times, shares of Common Stock are classified as stockholders’ equity. Our shares of Common Stock that were sold as part of Units in the Initial Public Offering feature certain redemption rights that are considered to be outside of our control and subject to the occurrence of uncertain future events.

On March 3, 2023, we held the First Special Meeting, at which our stockholders approved the First Extension Amendment Proposal. In connection with the vote to approve the First Extension Amendment Proposal, Public Stockholders holding 7,744,085 Public Shares properly exercised their right to redeem such shares for cash, at a redemption price of approximately $10.17 per share, for an aggregate redemption amount of approximately $78.77 million. As a result, on April 3, 2023, approximately $78.77 million was removed from the Trust Account to pay such Public Stockholders, following which, 5,099,852 shares of Common Stock subject to redemption, remained outstanding.

On September 22, 2023, we held the Second Special Meeting, at which our stockholders approved the Second Extension Amendment Proposal. In connection with the vote to approve the First Extension Amendment Proposal, Public Stockholders holding 3,060,282 Public Shares properly exercised their right to redeem such shares for cash, at a redemption price of approximately $10.46 per share, for an aggregate redemption amount of approximately $32.00 million. As a result, on October 18, 2023, approximately $32.00 million was removed from the Trust Account to pay such Public Stockholders, following which, 2,039,570 shares of Common Stock subject to redemption, remained outstanding.

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Recent Accounting Pronouncements

In June 2016, the FASB issued ASU Topic 2016-12, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-12”), which requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. ASU 2016-12 also requires additional disclosures regarding significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an entity’s portfolio. We adopted the provisions of ASU 2016-12 with effect from January 1, 2023. The adoption did not have a material impact on the financial statements contained elsewhere in this Report.

In August 2020, the FASB issued ASU Topic 2020-06, “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40)” (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments.

The provisions of ASU 2020-06 are applicable for fiscal years beginning after December 15, 2023, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020. The Company is currently assessing the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows.

In December 2023, the FASB issued ASU Topic 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), which requires disaggregated information about a reporting entity’s effective tax rate reconciliation, as well as information related to income taxes paid to enhance the transparency and decision usefulness of income tax disclosures. ASU 2023-09 will be effective for the annual period ending December 31, 2025. We are currently evaluating the timing and impacts of adoption of ASU 2023-09.

Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the financial statements and the notes thereto contained elsewhere in this.

Item 7A.      Quantitative and Qualitative Disclosures about Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this Item.

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Item 8.      Financial Statements and Supplementary Data.

Reference is made to pages F-1 through F-28 comprising a portion of this Report, which are incorporated herein by reference.

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Item 9.      Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

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Item 9A.      Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to Management, including our Chief Executive Officer and Chief Financial Officer (together, the “Certifying Officers”), or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our Management, including our Certifying Officers, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on the foregoing, our Certifying Officers concluded that our disclosure controls and procedures were not effective as of the end of the fiscal year ended December 31, 2023. Our internal control over financial reporting did not result in the application of complex financial instruments and complex accounting matters issued in March 2021, which, due to its impact on our financial statements, we determined to be a material weakness.

In light of this material weakness, we restated our financial statements included in our Quarterly Reports on Form 10-Q for the quarters ended June 30, 2021 and March 31, 2021, and Current Report on Form 8-K as of March 25, 2021, to reclassify all our Common Stock subject to possible redemption in temporary equity.

Additionally, we have enhanced our processes to identify and appropriately apply applicable accounting requirements to better evaluate and understand the nuances of the complex accounting standards that apply to our financial statements including making greater use of third-party professionals with whom we consult regarding complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects. We believe our efforts will enhance our controls relating to accounting for complex financial transactions, but we can offer no assurance that our controls will not require additional review and modification in the future as industry accounting practice may evolve over time.

We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Management’s Annual Report on Internal Control over Financial Reporting

As required by SEC rules and regulations implementing Section 404 of the Sarbanes-Oxley Act, our Management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external reporting purposes in accordance with GAAP. Our internal control over financial reporting includes those policies and procedures that:

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Because of its inherent limitations, internal control over financial reporting may not prevent or detect errors or misstatements in our financial statements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree or compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2023. In making these assessments, Management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework (2013). Based on this assessment, our Management concluded that our internal control over financial reporting was not effective as of December 31, 2023, due to its accounting for complex financial instruments, prepaid expenses, accrued expenses and franchise taxes.

Management has implemented remediation steps to improve our internal control over financial reporting. Specifically, we expanded and improved our review process for complex securities and related accounting standards. We plan to further improve this process by enhancing access to accounting literature, identification of third-party professionals with whom to consult regarding complex accounting applications and consideration of additional staff with the requisite experience and training to supplement existing accounting professionals.

This Report does not include an attestation report of our internal controls from our independent registered public accounting firm due to our status as an emerging growth company under the JOBS Act.

Changes in Internal Control over Financial Reporting

Other than as discussed above, there have been no changes to our internal control over financial reporting during the fiscal year ended December 31, 2023 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Item 9B.      Other Information.

Trading Arrangements

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During the quarterly period ended December 31, 2023, none of our directors or officers (as defined in Rule 16a-1(f) promulgated under the Exchange Act) adopted or terminated any “Rule 10b5-1 trading arrangement” or any “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.

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Additional Information

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None.

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Item 9C.       Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Not applicable.

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PART III

Item 10.      Directors, Executive Officers and Corporate Governance.

Directors and Executive Officers

As of the date of this Report, our directors and officers are as follows:

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The experience of our directors and executive officers is as follows:

Matthew Hong has served as the Chairman of the Board since February 2021. Since January 2023, Mr. Hong has served as President & Chief Operating Officer of PlayOn! Sports, a company engaged in streaming live and on-demand high school sports operating the NFHS Network, and GoFan, a high school ticketing solution in the United States. In this role, Mr. Hong oversees day-to-day operations for PlayOn! Sports.

From May 2008 to June 2019, Mr. Hong served in various roles, culminating in serving as the chief operating officer, between March 2017 and June 2019, of Turner Sports, a subsidiary of WarnerMedia and AT&T. In this role, he oversaw teams responsible for long-term business strategy, rights acquisitions, league partnerships, programming, marketing, revenue and sales inventory planning, and day-to-day operations for the division. In addition to his division-wide responsibilities, Mr. Hong oversaw the management of various sports businesses and properties including Bleacher Report, NBA TV, NBA Digital, NCAA Digital and March Madness Live, SI Digital, NASCAR.com, PGATOUR.com, PGA.com and PGA Championship Live, GOLF.com, and the B/R Live OTT offering.

Prior to Turner Sports, from January 2006 to May 2008, he served as vice president and general manager of interactive media at Thomson Learning. From November 1999 to January 2006, he served in multiple roles at AOL, including as executive director of business development and executive director of search. While at AOL, he architected and oversaw the company’s partnership with, and equity stake in, Google, and managed the search business across the AOL portfolio of properties.

Mr. Hong served as an independent director of Advocado, Inc., a data-as-a-service company, from July 2020 to July 2023. He previously served on the board of directors of PlayOn! Sports between August 2022 and January 2023; of Inception Growth Acquisition Limited, a special purpose acquisition company, between March 2021 and December 2022; of iStreamPlanet, a company that processes and delivers live video broadcasts over the Internet, between August 2015 and June 2019; and as a board observer of FanDuel, a gaming company, between June 2015 and October 2017. Mr. Hong received a JD, with honors, from Harvard Law School, and a BA in economics from NC State University. Mr. Hong is qualified to serve on the Board of Directors due to his significant experience as a senior executive of media and internet companies.

Thomas Bushey has served as our Chief Executive Officer and director since November 2020. Mr. Bushey brings a wealth of experience from his two-decades long career as a successful investor, board member and capital allocator. He is the founder and has served as CEO of Sunderland Capital since 2015. Sunderland Capital is an operationally focused, long-term oriented investment firm with a focus on emerging technologies and the consumer Internet. Mr. Bushey also served on the board of Ondas Holdings Inc. (Nasdaq: ONDS), a developer of private licensed wireless data networks for mission-critical industrial markets, from 2020 to 2023 . Prior to founding Sunderland Capital, he was a portfolio manager at Blackrock. Prior to Blackrock, Mr. Bushey was a senior analyst for Mayo Capital Partners and Millennium Partners. Mr. Bushey began his career as an analyst for Credit Suisse First Boston (“CSFB”) and later moved to HCI Equity Partners (Thayer Capital). At CSFB from 2002 to 2005, he executed and analyzed mergers, acquisitions, leveraged buyouts, divestitures, takeover defenses, restructurings and debt and equity financing for corporate clients and financial sponsors. Mr. Bushey has a BS in Economics from the Wharton School of the University of Pennsylvania. Mr. Bushey is qualified to serve on the Board of Directors due to his significant investment banking and management experience.

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Kenneth King has served as our Chief Financial Officer and director since November 2020. Mr. King has over 13 years of experience in venture building, venture capital, and mergers & acquisitions. Since 2019, Mr. King has been a founding partner of Cambium Grove Capital, a global asset management platform investing in venture, private equity and alternative credit. Between 2016 and 2018, Mr. King served as a special consultant at Yixia Technology (Miaopai), which acquired Tiantian, a mobile video application company that Mr. King co-founded in 2015, where he served as CEO, until the acquisition by Yixia Technology, in 2016. In 2011, Mr. King was also the first investor and founding member of Tessa Therapeutics, a Singapore- based biotechnology company backed by Temasek Holdings, where he served as COO until 2014. Mr. King started his career with Morgan Stanley’s Mergers and Acquisitions (M&A) Group in Hong Kong from 2008 to 2010, where he participated in buy-side, sell-side, and cross-border transactions across a wide range of industries and Asia-Pacific geographies. Mr. King graduated from Stanford University in 2008 with a B.A. in Economics and a M.S. in Management Science and Engineering. Mr. King is qualified to serve on the Board of Directors due to his significant venture building, venture capital, and mergers & acquisitions experience.

Jennifer Vescio has served as a member of the Board since February 2021. Since 2019, Ms. Vescio has served as the global head of business development for Uber Technologies Inc. where she is responsible for launching new strategic initiatives, closing partnership deals and managing partner operations. Ms. Vescio is a principal of Awestruck Ventures, a venture and strategy consulting firm she co-founded in 2015, where she currently serves as an advisor, investor, strategy and management consultant to tech, entertainment, sports & digital media firms as well as an executive coach to CEOs and their teams. Ms. Vescio also served as a member of the board of directors of the PGA Tour, the organizer of the main professional golf tours played by men in the United States and North America, from 2015 to 2020. From 2017 to 2018, Ms. Vescio served as senior vice president, global head of corporate development and partnerships for Verizon Media where she focused on strategic growth, new business development, partnerships, and investments. From 2013 to 2016, she served as the head of global strategy and business development at eBay (NASDAQ: EBAY). While at eBay, she managed over $600 million in GMV (Global Merchandise Volume) through its partner network, which included partnerships with Samsung, HP, Yahoo!, Facebook, Pinterest, Twitter, and Telefonica. She also launched new strategic initiatives and incubated new businesses such as eBay Now, an on-demand local ordering and delivery platform which launched in San Francisco and New York. From 2010 to 2013, Ms. Vescio was the vice president of global business development at ESPN. In 2009, CBS hired Ms. Vescio to lead its strategy & business development efforts until 2011. During her time at CBS, Ms. Vescio led its digital content distribution strategy and signed partnerships with YouTube, DailyMotion, eBay, Hulu and Yahoo!. Ms. Vescio earned her Bachelor of Science degree in Psychology/Biology from Allegheny College and her MBA from the UCLA Anderson School of Management. She also holds her ICF and NCF certifications for executive coaching. Ms. Vescio is qualified to serve on the Board of Directors due to her experience as an executive in technology, entertainment, sports or digital media, as well as her significant experience on business development and management.

Teddy Zee has served as a member of the Board since February 2021. Best known for such films as Pursuit of Happyness, Hitch & Charlie’s Angels, Mr. Zee has been a film and television producer since May 2005, with over thirty years of experience in Hollywood. He has built an active global advisory and consulting practice across media and technology. He has previously served as president of Sony-based Overbrook Films from 2001 to 2005, president of Fox-based Davis Entertainment from 1997 to 2001, EVP at Columbia Pictures from 1990 to 1997, SVP at Paramount Pictures from 1985 to 1990. Since 1996, he is a member of the Academy of Motion Picture Arts & Sciences (Oscars), Academy of Television Arts & Sciences (Emmys) and Producers Guild of America.

Mr. Zee has served as Co-Founder & COO for IdeasLab, which developed proprietary AI models and launched XView, an intuitive golf swing tracking application featuring real-time feedback and data visualization since March 2023. He has served on the Board of Directors for Koreatown Youth + Community Center in Los Angeles since January 2016. Mr. Zee served as Co-Founder and Chief Business Officer for MINTX, a Web3 based venture, from March  2021 to April 2024.

Mr. Zee has served as an advisor to ShortTV, a leading online platform that is launching and expanding in US and international markets, since April 2024; Ford Models, an international modelling agency, since July 2020; Pickit, the digital collectibles marketplace platform serving KPOP fans, since May 2020; Tapas Media, a platform for creators of bite-sized comics and web-stories, since September 2020; Kooding, an e-commerce fashion and beauty platform, since January 2017; and ParagonOne, a platform that manages internships for enterprises, since September 2015.

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Mr. Zee has previously served as an advisor to SM Entertainment, one of South Korea’s largest entertainment companies that has been responsible for fostering and popularizing the careers of many K-pop stars , from March 2021 to April 2024; Readlee, an AI based ed tech solution, from September 2020 to March 2023; Vizio, a leading HDTV maker and innovator in data & advertising around smart TVs, from August 2019 to March 2021; PureForm Global, a biotech company that synthesizes CBD from oils in orange peels, from March 2020 to April 2022; Tarsus Entertainment between August 2019 and October 2020, which delivers government approved video games through IPTV and OTT in China; and Watcha, a Korean streaming and data/analytics venture, from April 2018 to February 2020. Mr. Zee advised Biola University’s School of Cinema & Media Arts between December 2017 and June 2019; Oben, a Softbank-backed start-up that uses AI, computer vision and blockchain to deploy personal avatars for the masses, between September 2015 and January 2019; Meitu, the Chinese photo and video app company that went IPO in Hong Kong, between February 2015 and June 2016; Starmaker, the user generated music and video platform, between February 2016 and January 2017; and Ooyala, a leading online video platform company, between April 2013 and May 2015. Mr. Zee also served as head of creative, mobile technologies division for Rambus, between March 2012 and September 2013. Rambus acquired Silicon Valley interactive media start-up Mozaik Multimedia, where Mr. Zee had previously held the position of chief creative officer between September 2011 and March 2012. Mr. Zee earned an MBA from Harvard Business School and a BS from Cornell University. Mr. Zee is qualified to serve on the Board of Directors due to his significant experience in media and technology.

Family Relationships

No family relationships exist between any of our directors or executive officers.

Involvement in Certain Legal Proceedings

There are no material proceedings to which any director or executive officer, or any associate of any such director or officer is a party adverse to our Company, or has a material interest adverse to our Company.

Our Advisors

We leverage the capabilities of our advisors to assist us with the sourcing and evaluation of potential acquisition candidates. We believe the relationships, experience and expertise of these advisors will provide us with additional access and insight into potential target companies. However, our advisors are not executive officers of our Company and have no written advisory agreement with us, nor do they have any other employment arrangements with us. Moreover, our advisors are not under any fiduciary obligation to us nor do they perform board or committee functions, nor do they have any voting or decision-making capacity on our behalf. Our advisors are not required to devote any specific amount of time to our efforts or be subject to the fiduciary requirements to which our Board members are subject. Accordingly, if our advisors become aware of a Business Combination opportunity that is suitable for any of the entities to which they have fiduciary or contractual obligations, they will honor their fiduciary or contractual obligations to present such Business Combination opportunity to such entity, and only present it to us if such entity rejects the opportunity. We may modify or expand our roster of advisors as we source potential Business Combination targets or create value in businesses that we may acquire.

Ted Seides serves as our senior advisor. He is the founder of Capital Allocators LLC, a platform that includes podcasts, gatherings, and advisory that explore and share best practices in the asset management industry.

From 2002 to 2015, Mr. Seides served as the president and co-chief investment officer of Protégé Partners LLC, a leading multibillion-dollar alternative investment firm he co-founded that invested in and seeded small hedge funds. In 2016, Mr. Seides authored “So You Want to Start a Hedge Fund: Lessons for Managers and Allocators.” and, in 2021, authored “Capital Allocators: How the world’s elite money managers lead and invest.” His third book, “Private Equity Deals: Lessons in investing, dealmaking, and operations from private equity professionals.” releases in September 2024. Mr. Seides began his career in 1992 under the tutelage of David Swensen at the Yale University Investments Office.

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Katie Soo serves as our advisor. Ms. Soo is currently the senior vice president and head of growth marketing for HBO Max, but she has had a broad range of roles which has led her to spearhead the marketing efforts for Warner Brothers Digital and also for the DC Universe. As senior vice president of marketing, Ms. Soo is responsible for overseeing marketing across the Warner Brothers Digital Networks (WBDN) portfolio to develop initiatives that promote the division and strengthen the relationship with consumers. Ms. Soo plays a key role in enhancing brand awareness and exploring opportunities that help innovate the way consumers experience content through WBDN’s wide portfolio of assets.

Previously, Ms. Soo was the vice president of consumer marketing at Fullscreen Media, overseeing originals and content marketing, social, and public relations. Before that, she was head of social at Hulu where she led efforts to innovate, create and scale the digital vision across brand, originals, content, and product. Prior to Hulu, Ms. Soo was an early hire at Dollar Shave Club where she served as head of social and created the startup’s marketing roadmap. Ms. Soo remains actively involved with several startups and is also recognized for her work in both creative storytelling and digital products. She serves on the Partner Advisory board of Pinterest. Ad Age has Ms. Soo on their 40 under 40 list.

Number and Terms of Office of Officers and Directors

We have five directors. The Board is divided into three classes with only one class of directors being elected in each year and each class (except for those directors appointed prior to our first annual meeting of stockholders) serving a three-year term. In accordance with Nasdaq corporate governance requirements, we were not required to hold an annual meeting until one full year after our first fiscal year end following our listing on Nasdaq. We held our first annual meeting on December 27, 2022 and our second annual meeting on December 29, 2023.

The term of office of Class A directors, consisting of Jennifer Vescio, will expire at the annual meeting of stockholders to be held in 2025. The term of office of Class B directors, consisting of Teddy Zee and Matthew Hong, will expire at the annual meeting of stockholders to be held in 2026. The term of office of Class C directors, consisting of Kenneth King and Thomas Bushey, will expire at the annual meeting of stockholders to be held in 2024.

Our officers are appointed by the Board and serve at the discretion of the Board, rather than for specific terms of office. The Board is authorized to appoint persons to the offices set forth in our bylaws (the “Bylaws”) as it deems appropriate. The Bylaws provide that our officers may consist of one or more Chief Executive Officers, a Chief Financial Officer, a Secretary, and such other offices as may be determined by the Board.

Committees of the Board of Directors

The Board has two standing committees: the Audit Committee and a compensation committee (the “Compensation Committee”). Subject to phase-in rules and a limited exception, Nasdaq rules and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors, and Nasdaq rules require that the compensation committee of a listed company be comprised solely of independent directors. Each committee of the Board operates under a charter that has been approved by the Board, as amended, and has the composition and responsibilities described below.

Audit Committee

We have established the Audit Committee, which consists of Matthew Hong, Jennifer Vescio and Teddy Zee, each of whom is an independent director under Nasdaq’s listing standards. Mr. Zee chairs the Audit Committee. The Audit Committee’s duties, which are specified in our Audit Committee charter, include, but are not limited to:

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The Audit Committee has been and will at all times be composed exclusively of “independent directors” who are “financially literate” as defined under Nasdaq’s listing standards. Nasdaq’s standards define “financially literate” as being able to read and understand fundamental financial statements, including a company’s balance sheet, income statement and cash flow statement.

In addition, we must certify to Nasdaq that the Audit Committee has, and will continue to have, at least one member who has past employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience or background that results in the individual’s financial sophistication. The Board has determined that Matthew Hong qualifies as an “audit committee financial expert,” as defined under rules and regulations of the SEC.

Compensation Committee

We have established the Compensation Committee, which consists of Jennifer Vescio and Teddy Zee, each of whom is an independent director under Nasdaq’s listing standards. Jennifer Vescio chairs the Compensation Committee. The Compensation Committee’s duties, which are specified in our Compensation Committee charter, as amended, include, but are not limited to:

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Director Nominations

We do not have a standing nominating committee though we intend to form a corporate governance and nominating committee as and when required to do so by law or Nasdaq rules. In accordance with Rule 5605 of the Nasdaq rules, a majority of the independent directors may recommend a director nominee for selection by the Board. The Board believes that the independent directors can satisfactorily carry out the responsibility of properly selecting or approving director nominees without the formation of a standing nominating committee. The directors who will participate in the consideration and recommendation of director nominees are Matthew Hong, Jennifer Vescio and Teddy Zee. In accordance with Rule 5605 of the Nasdaq rules, all such directors are independent. As there is no standing nominating committee, we do not have a nominating committee charter in place.

The Board also considers director candidates recommended for nomination by our stockholders during such times as they are seeking proposed nominees to stand for election at the next annual meeting of stockholders (or, if applicable, a special meeting of stockholders). Our stockholders that wish to nominate a director for election to the Board should follow the procedures set forth in the Bylaws.

We have not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluating nominees for director, the Board considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our stockholders.

Code of Ethics

We have adopted a code of ethics that applies to all of our executive officers, directors and employees. The code of ethics codifies the business and ethical principles that govern all aspects of our business. We have filed a copy of our form of Code of Ethics as an exhibit to the Report. Our Code of Ethics is available on the SEC website at www.sec.gov. We intend to disclose any amendments to or waivers of certain provisions of our Code of Ethics in a Current Report on Form 8-K. Our code of ethics is also available, free of charge, to any stockholder upon written request to us.

Trading Policies

On December 1, 2023, we adopted insider trading policies and procedures governing the purchase, sale, and/or other dispositions of our securities by directors, officers and employees, which are reasonably designed to promote compliance with insider trading laws, rules and regulations, and applicable Nasdaq listing standards (the “Insider Trading Policy”).

The foregoing description of the Insider Trading Policy does not purport to be complete and is qualified in its entirety by the terms and conditions of the Insider Trading Policy, a copy of which is attached hereto as Exhibit 19 and is incorporated herein by reference.

Compensation Recovery and Clawback Policy

Under the Sarbanes-Oxley Act, in the event of misconduct that results in a financial restatement that would have reduced a previously paid incentive amount, we can recoup those improper payments from our executive officers. The SEC also recently adopted rules which direct national stock exchanges to require listed companies to implement policies intended to recoup bonuses paid to executives if the company is found to have misstated its financial results.

On December 1, 2023, our Board of Directors approved the adoption of the Executive Compensation Clawback Policy (the “Clawback Policy”), with an effective date of October 2, 2023, in order to comply with the final clawback rules adopted by the SEC under the Rule, and the listing standards, as set forth in the Nasdaq Listing Rule 5608 (the “Final Clawback Rules”).

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The Clawback Policy provides for the mandatory recovery of erroneously awarded incentive-based compensation from our current and former executive officers as defined in the Rule (“Covered Officers”) in the event that we are required to prepare an accounting restatement, in accordance with the Final Clawback Rules. The recovery of such compensation applies regardless of whether a Covered Officer engaged in misconduct or otherwise caused or contributed to the requirement of an accounting restatement. Under the Clawback Policy, our Board of Directors may recoup from the Covered Officers erroneously awarded incentive compensation received within a lookback period of the three completed fiscal years preceding the date on which we are required to prepare an accounting restatement.

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Item 11.      Executive Compensation.

No executive officer has received any cash compensation for services rendered to us. Commencing on the effective date of our IPO Registration Statement, through the acquisition of a target business or our liquidation of the Trust Account, we have paid and will continue to pay, the Sponsor $10,000 per month for providing us with office space and certain office and secretarial services pursuant to the Administrative Support Agreement. However, this arrangement is solely for our benefit and is not intended to provide our officers or directors compensation in lieu of a salary.

Other than the $10,000 per month administrative fee, the payment of consulting, success or finder fees to our (i) Sponsor, (ii) officers, (iii) directors, or (iv) their affiliates in connection with the consummation of our initial Business Combination and the repayment of the IPO Promissory Note, no compensation or fees of any kind has been or will be paid to the Sponsor, members of Management or their respective affiliates, for services rendered prior to or in connection with the consummation of our initial Business Combination (regardless of the type of transaction that it is), such as the Infinite Reality Business Combination. However, they receive reimbursement for any out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target businesses, performing business due diligence on suitable target businesses and Business Combinations as well as traveling to and from the offices, plants or similar locations of prospective target businesses to examine their operations. There is no limit on the amount of consulting, success or finder fees payable by us upon consummation of an initial Business Combination. Additionally, there is no limit on the amount of out-of-pocket expenses reimbursable by us; provided, however, that to the extent such expenses exceed the available proceeds not deposited in the Trust Account, such expenses would not be reimbursed by us unless we consummate an initial Business Combination.

After our initial Business Combination, members of Management who remain with us may be paid consulting, management or other fees from the combined company with any and all amounts being fully disclosed to stockholders, to the extent then known, in the proxy solicitation materials furnished to our stockholders, such as the Infinite Reality Registration Statement. However, the amount of such compensation may not be known at the time of the stockholder meeting held to consider an initial Business Combination, as it is up to the directors of the post-combination business to determine executive and director compensation. In this event, such compensation will be publicly disclosed at the time of its determination in a Current Report on Form 8-K or a periodic report, as required by the SEC.

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Item 12.      Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The following table sets forth information regarding the beneficial ownership of our Common Stock as of June 5, 2024 based on information obtained from the persons named below, with respect to the beneficial ownership of Common Stock, by:

In the table below, percentage ownership is based on 4,948,937 shares of our Common Stock issued and outstanding as of June 5, 2024.

Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all shares of Common Stock beneficially owned by them. Voting percentages represents the voting power of the shares owned beneficially by such person. The following table does not reflect record or beneficial ownership of the Private Placement Warrants as these Private Placement Warrants are not exercisable within 60 days of the date of this Report.

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Securities Authorized for Issuance under Equity Compensation Plans

None.

Changes in Control

None. For more information on the Infinite Reality Business Combination, please see “Item 1. Business”.

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Item 13.      Certain Relationships and Related Transactions, and Director Independence.

On January 20, 2021, we issued 4,312,500 shares of Common Stock to the Sponsor and its designees for $25,000 in cash, at a purchase price of approximately $0.006 per share, in connection with our organization. 250,000 Representative Shares were also issued to EBC and its designees. On March 22, 2021, the Sponsor and EBC effected a surrender of 862,500 and 50,000 shares of Common Stock, respectively, for no consideration. This resulted in a decrease in the total number of shares of Common Stock outstanding from 4,562,500 to 3,650,000.

On March 30, 2021, the underwriters of the Initial Public Offering partially exercised their over-allotment option to purchase an additional 843,937 Units at $10.00 per Unit. As a result of the underwriters’ election to partially exercise the over-allotment option, an aggregate of 239,016 Founder Shares were forfeited by the Sponsor.

The Sponsor purchased an aggregate of 354,715 Private Units and EBC purchased an aggregate of 52,164 Private Units, at a price of $10.00 per Private Unit, for an aggregate purchase price of $4,068,970 in the Private Placement, which occurred simultaneously with the closing of the Initial Public Offering. The Private Units are identical to the Units sold in our Initial Public Offering except that the Private Warrants included in the Private Units: (i) are not redeemable by us and (ii) may be exercised for cash or on a cashless basis, so long as they are held by the initial purchaser or any of their permitted transferees. Once the Private Warrants are transferred to anyone other than a permitted transferee, the Private Warrants will be redeemable by us and exercisable by the holders on the same basis as the Public Warrants. The Sponsor and EBC have agreed not to transfer, assign or sell any of the Private Shares and the Private Warrants (except to certain permitted transferees) until after the completion of our initial Business Combination. In the event of a liquidation prior to our initial Business Combination, the Private Shares and the Private Warrants will likely be worthless. If we do not complete a Business Combination within the Combination Period, the proceeds from the Private Placement will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law).

In order to meet our working capital needs following the consummation of our Initial Public Offering, the Sponsor, officers and directors or their affiliates may, but are not obligated to, loan us Working Capital Loans, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion. Each Working Capital Loan would be evidenced by a promissory note. The notes would either be paid upon consummation of our initial Business Combination, without interest, or, at the holder’s discretion, up to $1,500,000 of the notes may be converted into units at a price of $10.00 per unit. The units would be identical to the Private Units. In the event that the initial Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay any such Working Capital Loans, but no proceeds from our Trust Account would be used for such repayment.

Pursuant to the Registration Rights Agreement, the holders of (i) our Founder Shares, (ii) the Representative Shares, (iii) our Private Units (and all underlying securities) and (iv) any units that may be issued in payment of Working Capital Loans made to us (and all underlying securities), are entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that we register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of Common Stock are to be released from escrow. The holders of a majority of the Representative Shares, Private Units and units issued in payment of Working Capital Loans made to us (or all underlying securities) can elect to exercise these registration rights at any time after we consummate a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to our consummation of a Business Combination. Notwithstanding anything to the contrary, EBC may only make a demand on one occasion and only during the five-year period beginning on the effective date of the IPO Registration Statement. In addition, EBC may participate in a “piggy-back” registration only during the seven-year period beginning on the effective date of the IPO Registration Statement.

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On November 23, 2020, we issued the IPO Promissory Note to the Sponsor, pursuant to which we could borrow up to an aggregate principal amount of $0.30 million. The IPO Promissory Note was non-interest bearing and was payable on the earlier of June 30, 2021, or the consummation of the IPO. The outstanding balance of $0.19 million was paid in full on July 30, 2021.

On May 3, 2022, we issued the WCL Promissory Note to the Sponsor in the principal amount of $0.4 million to the Sponsor. On March 15, 2023, we amended and restated the WCL Promissory Note in its entirety to (i) increase the principal amount thereunder from $0.4 million to $0.9 million and (ii) remove the right of the holder of the WCL Note to convert all or any portion of the unpaid principal balance of the WCL Promissory Note into the units and related registration rights for such units (including underlying securities). As amended, the WCL Promissory Note is non-interest bearing and is payable on the earlier of (i) the date on which we consummate an initial Business Combination or (ii) the date that our winding up is effective. On March 22, 2023, we amended and restated the WCL Promissory Note to increase the principal amount from up to $0.9 million to up to $2.1 million, pursuant to which the Sponsor agreed to loan to us up to $2.1 million. At December 31, 2023 and December 31, 2022, approximately $1.02 million and $0.40 million were outstanding under the WCL Promissory Note, respectively.

In connection with the approval of the First Extension Amendment Proposal, the Sponsor or its designees agreed to contribute to us, under the WCL Promissory Note, (i) the Initial Contribution, plus, (ii) an aggregate of $200,000 per month (commencing on June 23, 2023 and on the 23rd day of each subsequent month) until September 25, 2023, or portion thereof, that was needed to complete an initial Business Combination, which amount was to be deposited into the Trust Account.

On March 24, 2023, the Sponsor made the Initial Contribution of $600,000, which was deposited into the Trust Account. On June 26, 2023, $200,000 was deposited into the Trust Account, which was comprised of a $100,000 payment from the Sponsor and a $100,000 payment from Infinite Reality. The remaining Monthly Extension Fees in connection with the approval of the First Extension Amendment Proposal were paid by Infinite Reality pursuant to the Second Merger Agreement Amendment.

In connection with the approval of the Second Extension Amendment Proposal, Infinite Reality agreed to contribute the Monthly Extension Fee to us, which amounted to $0.025 for each Public Share that was not redeemed in the Second Special Meeting Redemptions, or $50,989.25 (commencing on September 23, 2023 and on the 23rd day of each subsequent month) until March 25, 2024, or portion thereof, that was needed to complete an initial Business Combination. The remaining Monthly Extension Fees in connection with the approval of the Second Extension Amendment Proposal were paid by Infinite Reality pursuant to the Second Merger Agreement Amendment.

In connection with the approval of the Third Extension Amendment Proposal, Infinite Reality agreed to contribute the Monthly Extension Fee to us, which amounted to $0.03 for each Public Share that was not redeemed in the Third Special Meeting Redemptions, or $33,932.22 (commencing on March 23, 2024 and on the 23rd day of each subsequent month) until September 25, 2024, or portion thereof, that is needed to complete an initial Business Combination.

Pursuant to the Administrative Support Agreement, the Sponsor has agreed that, commencing on the effective date of the IPO Registration Statement and ending on the earlier of our consummation of our initial Business Combination or the liquidation of the Trust Account, it will make available to us certain general and administrative services, including office space, utilities and administrative support, as we may require from time to time. We pay $10,000 per month for these services. We believe, based on rents and fees for similar services, that these fees are at least as favorable as we could have obtained from an unaffiliated person.

We have entered into agreements with our officers and directors to provide contractual indemnification in addition to the indemnification provided for in our Amended and Restated Charter.

Other than the $10,000 per month administrative fee, the payment of consulting, success or finder fees to the Sponsor, officers, directors, or their affiliates in connection with the consummation of our initial Business Combination and repayment of the IPO Promissory Note, no compensation or fees of any kind has been or will be paid to the Sponsor, members of Management or their respective affiliates, for services rendered prior to or in connection with the consummation of our initial Business Combination (regardless of the type of transaction that it is). However, such individuals receive reimbursement for any out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target businesses, performing business due diligence on suitable target businesses and Business Combinations as well as traveling to and from the offices, plants or similar locations of prospective target businesses to examine their operations. There is no limit on the amount of consulting, success or finder fees payable by us upon consummation of an initial Business Combination. Additionally, there is no limit on the amount of out-of-pocket expenses reimbursable by us; provided, however, that to the extent such expenses exceed the available proceeds not deposited in the Trust Account, such expenses would not be reimbursed by us unless we consummate an initial Business Combination.

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After our initial Business Combination, members of Management who remain with us may be paid consulting, management or other fees from the combined company with any and all amounts being fully disclosed to stockholders, to the extent then known, in the proxy solicitation materials furnished to our stockholders, such as the Infinite Reality Registration Statement. However, the amount of such compensation may not be known at the time of the stockholder meeting held to consider an initial Business Combination, as it will be up to the directors of the post-combination business to determine executive and director compensation. In this event, such compensation will be publicly disclosed at the time of its determination in a Current Report on Form 8-K or a periodic report, as required by the SEC.

All ongoing and future transactions between us and any of our officers and directors or their respective affiliates will be on terms believed by us to be no less favorable to us than are available from unaffiliated third parties. Such transactions will require prior approval by a majority of our uninterested “independent” directors or the members of the Board who do not have an interest in the transaction, in either case who had access, at our expense, to our attorneys or independent legal counsel. We will not enter into any such transaction unless our disinterested “independent” directors determine that the terms of such transaction are no less favorable to us than those that would be available to us with respect to such a transaction from unaffiliated third parties.

For more information on the agreements with related parties entered into in connection with the Infinite Reality Business Combination, please see “Item 1. Business”.

Director Independence

Nasdaq listing standards require that a majority of the Board be independent. An “independent director” is defined generally as a person other than an officer or employee of the company or its subsidiaries or any other individual having a relationship which in the opinion of the company’s board of directors, would interfere with the director’s exercise of independent judgment in carrying out the responsibilities of a director. The Board has determined that Matthew Hong, Jennifer Vescio and Teddy Zee is each considered an “independent director” under the Nasdaq listing standards and applicable SEC rules Our independent directors have regularly scheduled meetings at which only independent directors are present.

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Item 14.      Principal Accountant Fees and Services.

The following is a summary of fees paid or to be paid to Marcum for services rendered.

Audit Fees

Audit fees consist of fees for professional services rendered for the audit of our year-end financial statements and services that are normally provided by Marcum in connection with regulatory filings. The aggregate fees of Marcum for professional services rendered for the audit of our annual financial statements, review of the financial information included in our Forms 10-Q for the respective periods and other required filings with the SEC for the years ended December 31, 2023 and 2022 totaled $118,771 and $77,250, respectively. The above amounts include interim procedures and audit fees, as well as attendance at Audit Committee meetings.

Audit-Related Fees

Audit-related fees consist of fees billed for assurance and related services that are reasonably related to performance of the audit or review of our financial statements and are not reported under “Audit Fees.” These services include attest services that are not required by statute or regulation and consultations concerning financial accounting and reporting standards. We did not pay Marcum for any audit-related fees for the years ended December 31, 2023 and 2022.

Tax Fees

Tax fees consist of fees billed for professional services relating to tax compliance, tax planning and tax advice. We did not pay Marcum for tax services, planning or advice for the years ended December 31, 2023 and 2022.

All Other Fees

All other fees consist of fees billed for all other services. We did not pay Marcum for any other services for the years ended December 31, 2023 and 2022.

Pre-Approval Policy

Our Audit Committee was formed upon the consummation of our Initial Public Offering. As a result, any services rendered prior to the formation of our Audit Committee were approved by our Board of Directors. Since the formation of our Audit Committee, and on a going-forward basis, the Audit Committee has and will pre-approve all auditing services and permitted non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject to the de minimis exceptions for non-audit services described in the Exchange Act which are approved by the Audit Committee prior to the completion of the audit).

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PART IV

Item 15.      Exhibit and Financial Statement Schedules.

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All financial statement schedules are omitted because they are not applicable or the amounts are immaterial and not required, or the required information is presented in the financial statements and notes thereto beginning on page F-1 of this Report.

We hereby file as part of this Report the exhibits listed in the attached Exhibit Index. Exhibits that are incorporated herein by reference can be inspected on the SEC website at www.sec.gov.

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Item 16.      Form 10-K Summary.

Omitted at our Company’s option.

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NEWBURY STREET ACQUISITION CORPORATION
INDEX TO FINANCIAL STATEMENTS

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F-1

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors of

Newbury Street Acquisition Corporation

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Opinion on the Financial Statements

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We have audited the accompanying balance sheets of Newbury Street Acquisition Corporation (the “Company”) as of December 31, 2023 and 2022, the related statements of operations, changes in stockholders’ deficit and cash flows for each of the two years in the period ended December 31, 2023, and the related notes  (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

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Explanatory Paragraph – Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 1 to the financial statements, the Company is a Special Purpose Acquisition Corporation that was formed for the purpose of completing a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or entities on or before September 25, 2024. The Company entered into a definitive merger/business combination agreement with a business combination target on December 12, 2022 and later amended on May 15, 2023, July 21, 2023 and February 26, 2024; however, the completion of this transaction is subject to the approval of the Company’s stockholders among other conditions. There is no assurance that the Company will obtain the necessary approvals, satisfy the required closing conditions, raise the additional capital it needs to fund its operations, and complete the transaction prior to September 25, 2024, if at all. The Company also has no approved plan in place to extend the business combination deadline and fund operations for any period of time after September 25, 2024, in the event that it is unable to complete a business combination by that date. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans with regard to these matters are also described in Note 1. The financial statements do not include any adjustments that may be necessary should the Company be unable to continue as a going concern.

Basis for Opinion

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These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

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Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

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F-3

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NEWBURY STREET ACQUISITION CORPORATION

BALANCE SHEETS

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The accompanying notes are an integral part of the financial statements.

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F-4

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NEWBURY STREET ACQUISITION CORPORATION

STATEMENTS OF OPERATIONS

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The accompanying notes are an integral part of the financial statements.

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F-5

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NEWBURY STREET ACQUISITION CORPORATION
STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

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