The following discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Special Note Regarding Forward-Looking Statements
This Quarterly Report includes "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended (the "Securities Act")
and Section 21E of the Exchange Act that are not historical facts and involve
risks and uncertainties that could cause actual results to differ materially
from those expected and projected. All statements, other than statements of
historical fact included in this Form 10-Q including, without limitation,
statements in this "Management's Discussion and Analysis of Financial Condition
and Results of Operations" regarding the Company's financial position, business
strategy and the plans and objectives of management for future operations, are
forward-looking statements. Words such as "expect," "believe," "anticipate,"
"intend," "estimate," "seek" and variations and similar words and expressions
are intended to identify such forward-looking statements. Such forward-looking
statements relate to future events or future performance, but reflect
management's current beliefs, based on information currently available. A number
of factors could cause actual events, performance or results to differ
materially from the events, performance and results discussed in the
forward-looking statements. For information identifying important factors that
could cause actual results to differ materially from those anticipated in the
forward-looking statements, please refer to the Risk Factors section of the
Company's final prospectus for its Initial Public Offering filed with the
This Management's Discussion and Analysis of Financial Condition and Results of
Operations has been amended and restated to give effect to the restatement of
our financial statements as of
Overview
We are a blank check company formed under the laws of the
We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete an initial business combination will be successful.
Results of Operations
We classify the warrants issued in connection with our Initial Public Offering and concurrent private placement as liabilities at their fair value and adjust the warrant liability to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statement of operations.
We have neither engaged in any operations nor generated any revenues to date.
Our only activities from
For the three months ended
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For the nine months ended
As noted in Note 2 to the Company's financial statements as of
Liquidity and Capital Resources
On
Following the Initial Public Offering, the full exercise of the over-allotment
option by the underwriters and the sale of the private placement warrants, a
total of
For the nine months ended
As of
As of
The Sponsor, or an affiliate of the Sponsor, or certain of our officers and
directors or their affiliates may, but are not obligated to, extend us working
capital loans as may be required in order to fund working capital deficiencies
or finance transaction costs in connection with an initial business combination.
If we complete an initial business combination, we would repay the working
capital loans out of the proceeds of the Trust Account released to us.
Otherwise, the working capital loans would be repaid only out of funds held
outside the Trust Account. In the event that an initial business combination
does not close, we may use a portion of proceeds held outside the Trust Account
to repay the working capital loans but no proceeds held in the Trust Account
would be used to repay the working capital loans. The working capital loans
would either be repaid upon consummation of an initial business combination,
without interest, or, at the lender's discretion, up to
We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an initial business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon consummation of our initial business combination, in which case we may issue additional securities or incur debt in connection with such initial business combination. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the consummate of our initial business combination. If we are unable to consummate 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. In addition, following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.
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Table of Contents Related Party Transactions Payments to an Affiliate
Commencing as of
Promissory Note
On
Off-Balance Sheet Arrangements
We have no obligations, assets or liabilities, which would be considered
off-balance sheet arrangements as of
Contractual Obligations
We did not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than as described below.
The underwriters are entitled to a deferred fee of
We entered into various consulting arrangements with several service providers
for administrative services and potential target financial analysis and due
diligence services to us. These arrangements provide for aggregate monthly fees
of approximately
Critical Accounting Policies
The preparation of financial statements and related disclosures in conformity
with accounting principles generally accepted in
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Class A Common Stock Subject to Possible Redemption
We account for our Class A common stock subject to possible redemption, if any, in accordance with the guidance in ASC Topic 480 "Distinguishing Liabilities from Equity." Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that feature redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) is classified as temporary equity. At all other times, common stock is classified as stockholders' equity. Our Class A common stock features certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, shares of Class A common stock subject to possible redemption are presented as temporary equity, outside of the stockholders' equity section of our condensed balance sheets.
Warrant Liability
We account for the warrants in accordance with the guidance contained in
ASC 815-40-15-7D and 7F under which the warrants do not meet the criteria for
equity treatment and must be recorded as liabilities. Accordingly, we classify
the warrants as liabilities at their fair value and adjust the warrants to fair
value at each reporting period. This liability is 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 warrants issued
in the initial public offering has been estimated using a Monte Carlo simulation
methodology as of the date of the initial public offering and such warrants'
quoted market prices as of
Net Income (Loss) per share of Common Stock
Net income (loss) per share of common stock is computed by dividing net income (loss) by the weighted average number of common stock outstanding for the period. The Company applies the two-class method in calculating net income (loss) per share. Accretion associated with the redeemable shares of Class A common stock is excluded from earnings per share as the redemption value approximates fair value. In addition, in connection with the change in presentation for the Public Shares, the Company determined it should restate its earnings per share calculation to allocate income and losses shared pro rata between its two classes of common stock.
Recent Accounting Standards
Our management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our financial statements.
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