Marblegate Acquisition Corp. (NASDAQ:GATE), a special purpose acquisition company with a market capitalization of $126 million, has entered into a material definitive agreement by issuing a promissory note in the principal amount of up to $485,000 to its sponsor-affiliated Marblegate Special Opportunities Master Fund, L.P., according to a recent SEC filing. Based on InvestingPro analysis, the company currently appears overvalued relative to its Fair Value.
The note, dated January 17, 2025, is designed to facilitate advances for working capital expenses. Interestingly, the note carries no interest and is payable upon the earlier of two events: the completion of the company's initial business combination or the effective date of the company's winding up. InvestingPro data reveals that the company's short-term obligations exceed its liquid assets, with a concerning current ratio of 0.23, highlighting the importance of this working capital injection.
Furthermore, the Payee has the option to convert up to $250,000 of the principal amount into Class A common stock of Marblegate Acquisition Corp. at a conversion price of $10.00 per share. These shares will be identical to those included in the units issued during the company’s initial public offering and will be subject to the same registration rights.
The issuance of the note is pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended. This move by Marblegate Acquisition Corp. has been made to support its financial structure as it pursues its business objectives.
Marblegate Acquisition Corp. is a Delaware-incorporated entity that operates under the blank check industrial classification, with its fiscal year ending on December 31. The company's business address and phone number are listed in the filing, providing transparency about its operations.
In other recent news, Marblegate Acquisition Corp. has secured a Nasdaq listing extension until March 2025 following non-compliance with a specific Nasdaq rule. This rule requires a blank check company to complete a business combination within 36 months of its initial public offering. The extension is dependent on Marblegate completing its proposed business combination with DePalma Acquisition I LLC and DePalma Acquisition II LLC by the new deadline.
Marblegate has also issued a promissory note of up to $250,000 to its sponsor's member, Marblegate Special Opportunities Master Fund, L.P., to cover working capital expenses. The note is non-interest bearing and can be converted into Class A common stock at a conversion price of $10.00 per share.
In other developments, Andrew Milgram, Paul Arrouet, and Patrick J. Bartels Jr. have been elected as Class III directors. Furthermore, 268,726 shares of Class A common stock were redeemed, leading to a withdrawal of about $2.9 million from the company's trust account.
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