SEC filing summary
Important identity note: The supplied 10-Q is for Committed Capital Acquisition Corporation, formerly Plastron Acquisition Corp. II—not ONE Group Hospitality, Inc. It covers the quarter ended June 30, 2011.
Business context and reporting period
Committed Capital was a development-stage blank-check company seeking to raise capital and combine with an as-yet-unidentified operating business. It reported no active operating business and no revenue through June 30, 2011. Financial statements are unaudited.
Financial results and position
| Metric | Q2 2011 / June 30, 2011 | Comparable period / prior year-end |
|---|---|---|
| Revenue | $0 | $0 in Q2 2010 and first half 2010 |
| Net loss | $6,388 for Q2; $18,519 for first half | $12,866 for Q2 2010; $16,754 for first half 2010 |
| Cash and cash equivalents | $391 | $612 at December 31, 2010 |
| Total assets | $123,252, including $122,861 in deferred offering costs | $5,112 at December 31, 2010 |
| Current liabilities | $227,993 | $84,406 at December 31, 2010 |
| Working capital | Deficit of $97,813 | — |
| Accumulated deficit | $128,741 | $110,222 at December 31, 2010 |
| Operating cash flow | Used $18,043 in first half 2011 | Used $16,581 in first half 2010 |
| Financing cash flow | Provided $17,822 in first half 2011 | Provided $11,100 in first half 2010 |
Q2 2011 loss per share was reported as $(0.00), rounded. The filing reports no revenue or operating margin. At June 30, liabilities included $120,000 owed under a related-party note, $27,768 in related-party advances, and $80,225 in accounts payable. The $120,000 note bears no interest and is payable upon consummation of an initial business transaction.
Changes, outlook, and risks
- First-half net loss increased to $18,519 from $16,754 in the prior-year period; Q2 loss declined to $6,388 from $12,866. Management attributed expenses primarily to professional fees, IPO-related costs, SEC reporting, and interest.
- On May 27, 2011, the company began the process of converting to a SPAC and filed an S-1 for a proposed offering of up to 5 million units at $5 each, or anticipated gross proceeds of $25 million. Each unit was to include one common share and one warrant. The filing does not establish that the offering had closed.
- The company said it expected to fund pre-IPO costs through BCM loans and advances, service-provider fee deferrals, and possible funding from stockholders, management, or other investors. BCM was expected to fund up to $800,000 of post-IPO expenses under a proposed expense-advancement agreement; the filing describes this agreement as anticipated, not completed.
- Management disclosed substantial doubt about the company’s ability to continue as a going concern, citing recurring losses, no revenue, minimal cash, and a working-capital deficit. Continued operations depended on financing and related-party support; the company gave no assurance it could meet cash needs for the next 12 months.
- The proposed SPAC structure allowed 21 months to complete an initial business transaction, or 24 months if a qualifying letter of intent or definitive agreement was signed within the first 21 months. These periods were tied to the future registration statement’s effectiveness.
- A 4.21875-for-1 forward stock split took effect May 20, 2011. Shares repurchased from two former holders were cancelled. On July 27, 2011, after quarter-end, the company amended the BCM note’s waiver concerning rights to offering-related trust funds.
- Management concluded disclosure controls were effective at quarter-end and reported no material change in internal controls. No material pending legal proceedings or defaults upon senior securities were reported. The filing provides no detailed risk-factor discussion because the company was a smaller reporting company.
Facts investors should verify
- Confirm the issuer: this filing identifies Committed Capital Acquisition Corporation, not ONE Group Hospitality, Inc.
- Verify whether the proposed IPO and related private placement were completed, and the final proceeds and trust-account arrangements.
- Review the status and terms of BCM’s related-party financing and the anticipated expense-advancement agreement, including the extent of ongoing funding support.
- Check the company’s available liquidity, unpaid offering costs, and ability to fund operations and complete a business combination.
- Confirm the applicable business-combination deadline and any subsequent developments after June 30, 2011.