Business Context and Reporting Period
This Form 8-K, dated October 10, 2017, reports the completion of a business combination involving GP Investments Acquisition Corp. ("GPIA") and Rimini Street, Inc. ("RSI"). GPIA, a Cayman Islands exempted company, domesticated as a Delaware corporation and merged with RSI in a reverse recapitalization. Immediately following the transaction, the surviving entity was renamed "Rimini Street, Inc." ("RMNI"). As of October 11, 2017, RMNI common stock, warrants, and units began trading on the NASDAQ Capital Market under the symbols "RMNI," "RMNIW," and "RMNIU," respectively. The transaction is accounted for as a reverse recapitalization, with RSI treated as the accounting acquirer.
Key Financial Metrics and Capital Structure
The filing details the capitalization and cash flows associated with the merger rather than operating performance metrics for a specific fiscal period.
- Share Redemptions: 14,286,064 GPIA public shares were redeemed at approximately $10.07 per share, resulting in aggregate cash payments of approximately $143,904,000.
- Private Placement Proceeds: The Sponsor (GPIC, Ltd.) purchased 3,600,000 shares in a private placement at $10.00 per share, generating gross proceeds of $36,000,000.
- Merger Consideration: RSI shareholders received 48,868,647 newly issued RMNI shares based on an exchange ratio of 0.239412772 RMNI shares for each RSI share.
- Post-Merger Capitalization: Total RMNI shares outstanding upon consummation were 58,580,796. Former RSI stockholders owned approximately 84% of the outstanding shares.
- Debt and Liquidity: The filing references a "Sixth Amendment" to RSI's Credit Facility but does not disclose specific debt balances, interest rates, or liquidity positions in this text. Pro forma financial statements are incorporated by reference from the Prospectus.
Material Changes Versus Prior Period
The primary material change is the corporate structure and ownership composition resulting from the reverse merger.
- Corporate Status: The registrant transitioned from a shell company (GPIA) to an operating entity (RMNI) with a change in shell company status.
- Ownership Shift: Control shifted to former RSI shareholders, who hold approximately 84% of the post-merger equity.
- Equity Instruments: Outstanding RSI options were converted into approximately 13,260,000 RMNI options (weighted average exercise price $2.76), and RSI warrants were converted into 3,440,424 RMNI warrants (exercise price $5.64).
- Legal Jurisdiction: The entity moved from Cayman Islands law to Delaware law.
Guidance, Outlook, Risks, and Unusual Items
Management Commentary and Outlook: The filing includes a cautionary note regarding forward-looking statements, noting that actual results may differ due to risks such as integration difficulties, inability to realize cost savings, and general economic conditions. Management expects to retain all earnings for business operations and does not anticipate declaring cash dividends in the foreseeable future.
Risks and Contingencies: Key risks identified include the inability to refinance existing debt on favorable terms, adverse litigation developments, and the uncertainty of realizing anticipated synergies. The filing notes that the ability to declare dividends is limited by restrictive covenants in the Credit Facility.
Unusual Items: The transaction involved a significant redemption of public shares ($143.9 million) offset by a sponsor equity commitment ($36 million) to meet minimum cash requirements for closing.
Important Facts for Investor Verification
- Verify the pro forma financial statements (specifically "Scenario No. 2" in the Prospectus) to understand the combined entity's historical financial position and debt obligations.
- Confirm the terms of the "Sixth Amendment" to the Credit Facility to assess debt covenants and refinancing risks.
- Review the "Risk Factors" section in the Original Prospectus and Supplement for detailed operational and financial risks.
- Monitor the integration progress and realization of cost savings, as these are cited as key uncertainties in the forward-looking statements.
- Check the trading volume and price stability of RMNI, RMNIW, and RMNIU on the NASDAQ Capital Market following the October 11, 2017 listing.