Brilliant Acquisition (BRLI) - 2023 Q4 - Annual Report

Business Combination - The Business Combination was completed on December 22, 2023, resulting in the merger of Brilliant Acquisition Corporation and Old Nukk, with Old Nukk becoming a wholly-owned subsidiary of Brilliant[13]. - Following the Business Combination, Nukkleus Common Stock and Nukkleus Warrants began trading on December 26, 2023, under the symbols "NUKK" and "NUKKW" respectively[28]. - Approximately 78.3% of the Combined Company is owned by Old Nukk stockholders, while Brilliant's public stockholders own approximately 0.5%[28]. - The Business Combination involved the cancellation of all outstanding shares of Old Nukk in exchange for a pro-rata portion of 10,500,000 shares of Brilliant Common Stock[25]. - The Business Combination included a Lock-Up Agreement preventing certain stockholders from selling their shares for two years post-Closing[29]. - The Backstop Pool in the Business Combination was equal to 40% of the aggregate number of Brilliant Ordinary Shares and Brilliant Rights, capped at 1,012,000 shares[26]. Financial Agreements and Revenue - Nukkleus has entered into a General Service Agreement with TCM, which stipulates a minimum payment of $1,600,000 per month for services provided[33]. - The company has historically generated most of its revenue through services rendered under the General Service Agreement, but is now repositioning its focus on digital assets due to limited net income from TCM[34]. - Nukkleus has entered into a Stock Purchase Agreement with White Lion, allowing for the purchase of shares up to a maximum amount of$75,000,000, which was terminated on February 21, 2024[31]. Product Development and Services - Digital RFQ aims to provide cross-border payment solutions and plans to develop a white-labelled digital bank for international business, although the timeline for these products remains uncertain[15]. - DigiClear is being developed to offer a custody and settlement utility operating system, with the goal of fully automating the transfer process within milliseconds[19]. - Nukkleus has developed various service categories, including risk management support software and retail trading platforms, to enhance its offerings in the FX industry[40]. Regulatory Compliance - Digital RFQ is regulated by the Financial Conduct Authority in the UK and is in compliance with Anti Money Laundering and Counter Terrorist Finance regulations[16]. Market Expansion and Workforce - Nukkleus is seeking to expand its presence in high-growth regions such as Asia and the Middle East within the retail FX market[39]. - The company has a total of approximately 12 employees, with 11 working for its subsidiary Digital RFQ and one for Nukkleus itself[56]. - Nukkleus has access to approximately 30 account managers through its relationship with FXDIRECT, who speak over 10 different languages[56]. Subsidiary Management and Acquisitions - The company has agreed to negotiate the sale of its wholly owned subsidiary, Digital RFQ Ltd., to its current management team, subject to board and shareholder approval[53]. - Nukkleus has acquired Patent Number 8799142 related to Forexware, which pertains to a method of displaying information associated with currency exchange transactions in real time[54]. Market Trends - The FX market has seen significant growth, with increased trading activity driven by factors such as electronic trading and rising volatility among currencies[36].