Unless the context otherwise requires, all references in this section to the "we," "us," "our," the "Company" or "Aurora" refer to Aurora prior to the consummation of the business combination. References to our "management" or our "management team" refer to our officers and directors, references to the "Sponsor" refer to Novator Capital Sponsor Ltd The following discussion and analysis of Aurora's financial condition and results of operations should be read in conjunction with Aurora's consolidated financial statements and notes to those statements included in this report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties. Aurora's actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors. Please see the section entitled "Cautionary Statement Regarding Forward-Looking Statements" and "Risk Factors"

Overview

We are a blank check company incorporated on October 7, 2020 as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more



                                       27

  Table of Contents

businesses. In April 2021, we selected Better HoldCo, Inc. ("Better") as a business combination target and initiated substantive discussions with Better with respect to an initial business combination with us. On May 11, 2021, we and Better, one of the fastest-growing digital homeownership platforms in the United States, announced that we have entered into the Merger Agreement that will transform Better, one of the fastest-growing digital homeownership platforms in the United States, into a publicly-listed company. This transaction reflects an implied equity value for Better of approximately $6.9 billion and a post-money equity value of approximately $7.7 billion.

The issuance of additional shares in a business combination:

may significantly dilute the equity interest of investors in this offering,

which dilution would increase if the anti-dilution provisions in the Aurora

? Class B ordinary shares resulted in the issuance of Aurora Class A ordinary

shares on a greater than one-to-one basis upon conversion of the Aurora Class B

ordinary shares.

may subordinate the rights of holders of Aurora Class A ordinary shares if

? preference shares are issued with rights senior to those afforded our Aurora

Class A ordinary shares;

could cause a change in control if a substantial number of our Aurora Class A

? ordinary shares are issued, which may affect, among other things, our ability

to use our net operating loss carry forwards, if any, and could result in the

resignation or removal of our present executive officers and directors;

may have the effect of delaying or preventing a change of control of us by

? diluting the share ownership or voting rights of a person seeking to obtain

control of us; and

? may adversely affect prevailing market prices for our Aurora units, Aurora

Class A ordinary shares and/or Aurora public warrants.

Similarly, if we issue debt securities or otherwise incur significant debt, it could result in:

? default and foreclosure on our assets if our operating revenues after an

initial business combination are insufficient to repay our debt obligations;

acceleration of our obligations to repay the indebtedness even if we make all

? principal and interest payments when due if we breach certain covenants that

require the maintenance of certain financial ratios or reserves without a

waiver or renegotiation of that covenant;

? our immediate payment of all principal and accrued interest, if any, if the

debt security is payable on demand;

our inability to obtain necessary additional financing if the debt security

? contains covenants restricting our ability to obtain such financing while the

debt security is outstanding;

? our inability to pay dividends on our Aurora Class A ordinary shares;

using a substantial portion of our cash flow to pay principal and interest on

? our debt, which will reduce the funds available for dividends on our Aurora

Class A ordinary shares if declared, expenses, capital expenditures,

acquisitions and other general corporate purposes;

? limitations on our flexibility in planning for and reacting to changes in our

business and in the industry in which we operate;

? increased vulnerability to adverse changes in general economic, industry and

competitive conditions and adverse changes in government regulation;




                                       28

  Table of Contents

limitations on our ability to borrow additional amounts for expenses, capital

? expenditures, acquisitions, debt service requirements, execution of our

strategy and other purposes; and

? other disadvantages compared to our competitors who have less debt.

We expect to continue to incur significant costs in the pursuit of our initial business combination. We cannot assure you that our plans to complete our initial business combination will be successful. In the event that the Company does not consummate a business combination by September 30, 2023, we can seek a further extension provided we have shareholder approval.

Recent Developments

On January 9, 2023, we received a notice from the Listing Qualifications Department of The Nasdaq Stock Market LLC stating that the Company failed to hold an annual meeting of shareholders within 12 months after its fiscal year ended December 31, 2021, as required by Nasdaq Listing Rule 5620(a). In accordance with Nasdaq Listing Rule 5810(c)(2)(G), we submitted a plan to regain compliance on February 17, 2023. We believe the combined annual and extraordinary general meeting we held on February 24, 2023 will satisfy this requirement under Nasdaq rules.

On February 7, 2023, Aurora, Better and the Sponsor entered into a letter agreement, pursuant to which, subject to Better receiving requisite approval therefor (which Better has agreed to use reasonable best efforts to obtain), the parties agreed that, if the Proposed Business Combination has not been consummated by the maturity date of the bridge notes, the Sponsor will have the option, without limiting its rights under the Bridge Note Purchase Agreement (as defined below) to alternatively exchange its bridge notes on or before the maturity date as follows: (x) for a number of shares of Better preferred stock at a conversion price that represents a 50% discount to the $6.9 billion pre-money equity valuation of Better or (y) for a number of shares of the Company's Class B common stock at a price per share that represents a 75% discount to the $6.9 billion pre-money equity valuation of Better. On the same date, the Sponsor and Better agreed to defer the maturity date of the bridge notes until September 30, 2023.

On February 8, 2023, we repaid an aggregate principal amount of $2.4 million under the unsecured promissory note (the "Note") issued to the Sponsor ("Payee") on May 10, 2021. After giving effect to this repayment, the amount outstanding under the Note is approximately $412,395.

On February 23, 2023, we, the Sponsor, certain individuals, each of whom is a member of our board of directors and/or management team (the "Insiders"), and Better entered into a limited waiver (the "Limited Waiver") to the Amended and Restated Letter Agreement (the "A&R Letter Agreement"), dated as of May 10, 2021, by and among us, the Sponsor and the Insiders. In the A&R Letter Agreement, the Sponsor and each Insider waived, with respect to any shares of Capital Stock (as defined in the A&R Letter Agreement) held by it, him or her, if any, any redemption rights it, he or she may have in connection with (i) a shareholder vote to approve the Business Combination (as defined in the A&R Letter Agreement), or (ii) a shareholder vote to approve certain amendments to the Company's amended and restated articles of association (the "Redemption Restriction").

Pursuant to the Limited Waiver, the Company and the Insiders agreed to waive the Redemption Restriction as it applies to the Sponsor to the limited extent required to allow the redemption of up to an aggregate of $17 million worth of Novator Private Placement Shares held by it in connection with the shareholder vote to approve an amendment to the Company's amended and restated memorandum and articles of association held on February 24, 2023

As consideration for the Limited Waiver, the Sponsor agreed: (a) if the Proposed Business Combination is completed on or before September 30, 2023, to subscribe for and purchase common stock of Better Home & Finance (the "Better Common Stock"), for aggregate cash proceeds to Better equal to the actual aggregate amount of Novator Private Placement Shares redeemed by it in connection with the Limited Waiver (the "Sponsor Redeemed Amount") at a purchase price of $10.00 per share of Better Common Stock on the closing date of the Proposed Business Combination; or (b) if the Proposed Business Combination is not completed on or before September 30, 2023, to subscribe for and purchase for $35 million aggregate cash proceeds to Better, at the Sponsor's election, (x) a number of newly issued shares of Better's Company Series D Equivalent Preferred Stock (as defined in the Bridge Note Purchase Agreement (as defined below)) at a price per share that represents a 50% discount to the Pre-Money Valuation (as defined below) or (y) for a number of shares of Better's Class B common stock at a price per share that represents a 75% discount to the Pre-Money Valuation.



                                       29

Table of Contents

"Pre-Money Valuation" means the $6.9 billion pre-money equity valuation of Better based on the aggregate amount of fully diluted shares of Better's common stock on an as-converted basis.

As further consideration for the Limited Waiver, the Sponsor agreed to reimburse the Company for reasonable and documented expenses incurred by the Company in connection with the Proposed Business Combination, up to the Sponsor Redeemed Amount, to the extent such expenses are not otherwise subject to reimbursement by Better pursuant to the Merger Agreement.

On February 24, 2023, Aurora, Merger Sub and Better entered into Amendment No. 5 to the Merger Agreement, pursuant to which the parties agreed to extend the Agreement End Date (as defined in the Merger Agreement) from March 8, 2023 to September 30, 2023.

We held a combined annual and extraordinary general meeting on February 24, 2023, and extended the date by which the Company has to consummate a business combination from March 8, 2023 to September 30, 2023. As part of the meeting, public shareholders redeemed 24,087,689 ordinary shares and the Sponsor redeemed 1,663,760 ordinary shares for an aggregate cash balance of approximately $263,123,592.

Results of Operations and Known Trends or Future Events

Aurora's entire activity since inception through December 31, 2022 related to Aurora's formation, the preparation for the initial public offering and, since the closing of the initial public offering, the search for a prospective initial business combination that culminated in signing the Merger Agreement with Better on May 11, 2021. Aurora has neither engaged in any operations nor generated any revenues to date. Aurora will not generate any operating revenues until after completion of its business combination. Aurora will generate non-operating income in the form of interest income on cash and cash equivalents. Aurora expects to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

For the years ended December 31, 2022 and 2021, we had net income (loss) of $8,735,542 and ($6,527,175), respectively, which consisted of a $12,868,205 and $1,576,196 gain (loss), respectively, from changes in the fair value of derivative warrant liabilities, $0 and $296,905 gain (loss), respectively, from changes in the fair value of over-allotment option liabilities, $182,658 and $0, gain respectively, on the deferred underwriting fee, offering costs allocated to warrant liabilities of $0 and $299,523, respectively, and $8,577,543 and $8,120,280, respectively, in general and administrative costs.

Aurora classifies the warrants issued in connection with our initial public offering and the sale of the Novator Private Placement Units and the Private Placement Warrants as liabilities at their fair value and adjust the warrant instruments to fair value at each reporting period. These liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statement of operations. For the years ended December 31, 2022 and 2021, the change in fair value of warrants was a decrease of $12,868,205 and $1,576,196, respectively.

Liquidity and Capital Resources

As indicated in the accompanying financial statements, as of December 31, 2022, Aurora had working capital deficiency of $14,605,202.

The net proceeds from (i) the sale of the units in the initial public offering, after deducting offering expenses of $581,484 and underwriting commissions of $4,860,057 based on the underwriters' partial exercise of their over-allotment option (excluding deferred underwriting commissions of $8,505,100), (ii) the sale of the Private Placement Warrants for a purchase price of $1.50 which accounts for the underwriters' partial exercise of their over-allotment option and (iii) the Novator Private Placement Units, equaled $278,002,870, which is held in the Trust Account and includes the deferred underwriting commissions described above. The proceeds held in the Trust Account were, since our IPO until February 24, 2023 held only in U.S. "government securities" within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations. On or around February 24, 2023, Aurora instructed Continental to liquidate the securities held in the Trust Account and thereafter to hold all funds in the Trust Account in cash (i.e., in one or more bank accounts).



                                       30

  Table of Contents

Aurora intends to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account (less taxes payable and deferred underwriting commissions) to complete its initial business combination. Aurora may withdraw interest to pay its income taxes, if any.

Aurora's annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the Trust Account. Aurora expects the interest earned on the amount in the Trust Account will be sufficient to pay its income taxes. To the extent that Aurora's equity or debt is used, in whole or in part, as consideration to complete its initial business combination, the remaining proceeds held in the Trust Account will be used to repay such debt, as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue Aurora's growth strategies.

As of December 31, 2022, Aurora had $285,307 of cash held outside the Trust Account. The use of these funds is to primarily identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, structure, negotiate and complete a business combination, prepare and make required securities filings, listing application and pay legal and professional fees.

Aurora may have insufficient funds available to operate its business prior to its initial business combination. In order to fund working capital deficiencies or finance transaction costs in connection with an intended initial business combination or to fund certain other expenses (including officer expenses to the extent in excess of Aurora's estimates and expenses relating to payments due to one of Aurora's officers), Aurora's Sponsor or its affiliates may, but are not obligated to, loan Aurora funds as may be required. If Aurora completes its initial business combination, Aurora would repay such loaned amounts. Should Aurora's operating costs, in relation to its proposed business combination, exceed the amounts still available and not currently drawn under the Note, the Sponsor shall increase the amount available under the Note to cover such costs, subject to an aggregate cap of $12,000,000. This amount would be reflective of estimated total costs of Aurora through November 15, 2023 in relation to the business combination, in the event the business combination is unsuccessful. The Note is non-interest bearing and payable by check or wire transfer of immediately available funds or as otherwise determined by Aurora to such account as the Payee may from time to time designate by written notice in accordance with the provision of the Note.

In the event that the Proposed Business Combination does not close, Aurora may use a portion of the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from Aurora's Trust Account would be used for such repayment. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Prior to the completion of Aurora's initial business combination, Aurora does not expect to seek loans from parties other than its Sponsor or an affiliate of the Sponsor as Aurora does not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in Aurora's Trust Account.

On August 26, 2022, Aurora, Merger Sub and Better entered into Amendment No. 4 to the Merger Agreement whereby Better has also agreed to reimburse Aurora for reasonable transaction expenses as defined in the Merger Agreement, an aggregate amount not to exceed $15,000,000, structured in three tranches. Within five business days of the execution of Amendment No.4 to the Merger Agreement, Better paid Aurora the first tranche of $7,500,000 and, on February 6, 2023, Better paid Aurora the second tranche of $3,750,000, each as part of Better's agreement to reimburse Aurora for transaction expenses as defined in the Merger Agreement. The third payment of up to $3,750,000 shall be paid on April 1, 2023. On February 24, 2023, Aurora, Merger Sub and Better entered into Amendment No. 5 to the Merger Agreement, pursuant to which the parties agreed to extend the Agreement End Date (as defined in the Merger Agreement) from March 8, 2023 to September 30, 2023.

In addition, pursuant to the Limited Waiver, the Sponsor has agreed to reimburse the Company for reasonable and documented expenses incurred by the Company in connection with the Proposed Business Combination, up to the Sponsor Redeemed Amount, to the extent such expenses are not otherwise subject to reimbursement by Better pursuant to the Merger Agreement.

We initially expected our primary liquidity requirements during that period to include approximately $300,000 for legal, accounting, due diligence, travel and other expenses associated with structuring, negotiating and documenting a successful business combinations; $100,000 for legal and accounting fees related to regulatory reporting requirements; $250,000 for consulting, travel and miscellaneous expenses incurred during the search for an initial business combination target; $75,000 for Nasdaq continued listing fees; and $35,000 for general working capital that will be used for miscellaneous expenses and reserves.



                                       31

  Table of Contents

These amounts were estimates and have differed materially from our actual expenses. In addition, Aurora could use a portion of the funds not being placed in trust to pay commitment fees for financing, among other things.

Moreover, we may need to obtain additional financing to complete our initial business combination, either because the transaction requires more cash than is available from the proceeds held in our Trust Account or because we become obligated to redeem a significant number of our public shares upon completion of the business combination, in which case we may issue additional securities or incur debt in connection with such business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the Trust Account.

Going Concern

In connection with the Company's going concern considerations in accordance with guidance in the Financial Accounting Standards Board (the "FASB") Accounting Standards Codification ("ASC") 205-40, Presentation of Financial Statements - Going Concern, the Company has until September 30, 2023 to consummate a business combination. The Company's mandatory liquidation date, if a business combination is not consummated, raises substantial doubt about the Company's ability to continue as a going concern. These audited financial statements do not include any adjustments related to the recovery of the recorded assets or the classification of the liabilities should the Company be unable to continue as a going concern. As discussed in Note 1, in the event of a mandatory liquidation, within ten business days, the Company will redeem the Public Shares, at a per-share price, payable in cash, equal to the allocated amount towards the Public Shares (in this case, not including the existing Novator Private Placement Shares) then on deposit in the Trust Account including the allocated interest earned on the funds held in the Trust Account and not previously released to the Company to pay taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares.

JOBS Act

On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We will qualify as an "emerging growth company" and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

Additionally, we have relied on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, we, as an "emerging growth company", have elected to utilize certain exceptions, so that we are not required to, among other things, (i) provide an independent registered public accounting firm's attestation report on our system of internal controls over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the report of the independent registered public accounting firm providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive Officer's compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our initial public offering or until we are no longer an "emerging growth company," whichever is earlier.



                                       32

Table of Contents

Critical Accounting Policies; Recent Accounting Pronouncements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could materially differ from those estimates. Aurora has identified the following critical accounting policies:

Class A Ordinary Shares Subject to Possible Redemption

Aurora accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities from Equity." Class A ordinary shares subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within Aurora's control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders' equity. Aurora's Class A ordinary shares feature certain redemption rights that are considered to be outside of Aurora's control and subject to the occurrence of uncertain future events.

Accordingly, at December 31, 2022, Class A ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders' equity section of Aurora's balance sheet. The Sponsor and Aurora's directors and officers have agreed to waive their redemption rights with respect to any founder shares, Novator Private Placement Shares and public shares held by them in connection with the completion of a business combination.

Net Loss Per Ordinary Share

Aurora complies with accounting and disclosure requirements of FASB ASC Topic 260, "Earnings Per Share." Net loss per share is computed by dividing net loss by the weighted-average number of shares of ordinary shares outstanding during the period excluding ordinary shares subject to forfeiture. An aggregate of 24,300,287 Class A ordinary shares subject to possible redemption on December 31, 2022 have been excluded from the calculation of basic loss per ordinary share, since such shares, if redeemed, only participate in their pro rata share of the trust earnings. Aurora has not considered the effect of the warrants sold in Aurora's initial public offering (including the consummation of the over-allotment units) and private placement to purchase an aggregate of 11,523,444 ordinary shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events. As a result, diluted net loss per ordinary share is the same as basic net loss per ordinary share for the period presented.

The Company's statement of operations includes a presentation of income (loss) per share for ordinary shares subject to possible redemption in a manner similar to the two-class method of income per ordinary share. According to SEC guidance, ordinary shares that are redeemable based on a specified formula is considered to be redeemable at fair value if the formula is designed to equal or reasonably approximate fair value. When deemed to be redeemable at fair value, the weighted average redeemable shares would be included with the non-redeemable shares in the denominator of the calculation and initially calculated as if they were a single class of ordinary shares.

Derivative Warrant Liabilities

The 6,075,072 Aurora public warrants and the 5,448,372 Private Placement Warrants are recognized as derivative liabilities in accordance with ASC 815-40. Accordingly, we recognize the warrant instruments as liabilities at fair value and adjust the instruments to fair value at each reporting period. The liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statement of operations. The fair value of the Aurora public warrants issued in connection with our initial public offering was initially measured at fair value using a combination of Monte Carlo and Binomial Lattice models. The fair value of the Private Placement Warrants issued in connection with our initial public offering was initially measured at fair value using a Black-Scholes Option Pricing Model and subsequently, the fair value of the Private Placement Warrants has been estimated using a Black-Scholes Option Pricing Model each measurement date. The fair value of Aurora public warrants issued in connection with our initial public offering has subsequently been measured based on the listed market price of such Aurora public warrants.

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on Aurora's financial statements.



                                       33

Table of Contents

© Edgar Online, source Glimpses