Alpha Modus Holdings, Inc. — 2024 Q1 filing summary
Registrant identity: The supplied filing is Insight Acquisition Corp.’s Form 10-Q, not a filing under the name Alpha Modus Holdings, Inc. Alpha Modus, Corp. is identified as the proposed merger target.
Business context and reporting period
The filing covers the unaudited quarter ended March 31, 2024. Insight is a SPAC formed to complete a business combination; it had not commenced operating activities and had no operating revenue. Its proposed merger with Alpha Modus, Corp. was pending, and a registration statement for the transaction had been filed.
Financial results and position
| Metric | Q1 2024 / March 31, 2024 | Comparable period / December 31, 2023 |
|---|---|---|
| Operating revenue | None | None |
| Net result | Net loss of $633,846; loss per share of $0.09 | Net income of $895,469; income per share of $0.04 |
| Operating loss | $466,981 | $631,326 |
| Trust investment gain | $141,122 | $1,884,991 |
| Operating cash flow | $(235,461) | $(289,693) |
| Cash at period end | $53,377 | Cash and restricted cash totaled $314,482 at year-end |
| Total assets | $12,471,449 | $12,353,755 |
| Current assets / current liabilities | $1,140,395 / $5,796,019 | $1,689,065 / $5,260,471 |
| Total liabilities | $13,089,476 | $12,493,496 |
| Trust investments | $11,981,456 fair value | $10,664,690 |
| Stockholders’ deficit | $(11,612,138) | $(10,987,144) |
There are no meaningful operating margins to assess because the company reported no operating revenue. The filing identifies a $4,655,624 working-capital deficit. It reports $800,000 funded under the Polar-related subscription arrangement, recorded net of debt discount; the balance sheet shows $570,166 due to the investor. Deferred underwriting commissions of $6.6 million are payable only if a business combination closes.
Material changes, outlook and risks
- Results shifted from prior-year net income to a quarterly loss. Lower trust investment gains, debt-discount interest expense of $226,615, and derivative-liability losses contributed; general and administrative expenses were lower than a year earlier.
- Management said it had until June 7, 2024 to complete a business combination and warned that failure would require liquidation. It concluded that liquidity constraints and potential liquidation raised substantial doubt about the company’s ability to continue as a going concern. The filing provides no assurance that additional financing will be available.
- After quarter-end, the company reported that approximately $1.049 million withdrawn from the trust for tax purposes had been used for other company expenses. The Sponsor returned that amount and an additional $36,285 for foregone trust interest in March 2024. The company stated there was no financial loss to shareholders or the trust.
- The Board removed Jeff Gary as CEO and CFO on April 21, 2024; Michael Singer became CEO and Glenn Worman became CFO. The company described trust-fund withdrawals and transfers, late filings, and prior-period restatements as material weaknesses. Disclosure controls and internal control over financial reporting were deemed ineffective as of March 31, 2024.
- On June 5, 2024, stockholders approved an extension of the business-combination deadline to December 7, 2024, subject to monthly trust deposits; 481,865 Class A shares were tendered for redemption. This event occurred after the reporting period.
- Other exposures include a $2,348,302 excise-tax payable, whose ultimate responsibility depends in part on the outcome and circumstances of the proposed transaction, and an Avila reimbursement receivable that management considers uncollectible. The filing also cites uncertainty from geopolitical events.
Important facts for investors to verify
- Confirm the correct issuer and security: the filing is for Insight Acquisition Corp., while Alpha Modus, Corp. is the proposed target.
- Check the status and closing conditions of the Alpha Modus merger, including regulatory filings, shareholder approvals, financing, redemptions, and any subsequent extension deposits.
- Review current unrestricted cash, remaining funding capacity under the Polar arrangement, and the company’s ability to meet operating costs and transaction expenses.
- Verify the trust-account reimbursement, related-party fund transfers, remediation of material weaknesses, and timeliness and reliability of subsequent financial reporting.
- Assess the treatment and payer of the excise-tax liability, the deferred underwriting commissions, and any dilution from warrants, founder shares, or subscription arrangements.
- The financial statements report 2023 quarterly net income of $895,469, while the MD&A narrative describes approximately $935,000; verify the discrepancy against the filed statements and any subsequent amendments.