References to the "Company," "
Cautionary Note Regarding Forward-Looking Statements
This quarterly report on Form 10-Q (this "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 Securities Exchange Act
of 1934, as amended (the "Exchange Act"). We have based these forward-looking
statements on our current expectations and projections about future events.
These forward-looking statements are subject to known and unknown risks,
uncertainties and assumptions about us that may cause our actual results, levels
of activity, performance or achievements to be materially different from any
future results, levels of activity, performance or achievements expressed or
implied by such forward-looking statements. In some cases, you can identify
forward-looking statements by terminology such as "may," "should," "could,"
"would," "expect," "plan," "anticipate," "believe," "estimate," "continue," or
the negative of such terms or other similar expressions. Factors that might
cause or contribute to such a discrepancy include, but are not limited to, those
described in our other
Overview
We are a blank check company incorporated on
The issuance of additional shares in a business combination:
? may significantly dilute the equity interest of investors in our Initial Public
Offering, which dilution would increase if the anti-dilution provisions in the
Class B ordinary shares resulted in the issuance of Class A ordinary shares on
a greater than one-to-one basis upon conversion of the Class B ordinary shares;
? may subordinate the rights of holders of Class A ordinary shares if preference
shares are issued with rights senior to those afforded our Class A ordinary
shares;
? could cause a change in control if a substantial number of our 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 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;
? may adversely affect prevailing market prices for our units, Class A ordinary
shares and/or warrants; and
? may not result in adjustment to the exercise price of our warrants.
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Similarly, if we issue debt 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 is payable on demand;
? our inability to obtain necessary additional financing if the debt contains
covenants restricting our ability to obtain such financing while the debt is
outstanding;
? our inability to pay dividends on our 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 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; and
? 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.
As indicated in the accompanying financial statements, as of
On
By virtue of the Merger, each of our ordinary shares issued and outstanding
immediately prior to the effective time of the Merger (after giving effect to
specified events) would be automatically cancelled and extinguished and
exchanged for a number of ordinary shares of
Results of Operations
Our entire activity since inception up to
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For the three months ended
For the three months ended
For the nine months ended
For the period from
Liquidity and Capital Resources
Prior to the completion of our Initial Public Offering, our liquidity needs were
satisfied through (i)
We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest and other income earned on the Trust Account (less taxes payable and deferred underwriting commissions), to complete our initial Business Combination. We may withdraw interest income (if any) to pay income taxes, if any. Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the Trust Account. We expect the interest income earned on the amount in the Trust Account (if any) will be sufficient to pay our income taxes. To the extent that our equity or debt is used, in whole or in part, as consideration to complete our initial Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
Prior to the completion of our initial Business Combination, we have available
to us the
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We do not believe we will need to raise additional funds following our Initial
Public Offering in order to meet the expenditures required for operating our
business prior to our initial Business Combination, other than funds available
from loans from our Sponsor, its affiliates or members of our management team.
However, if our estimates 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. In order to fund working capital deficiencies or finance
transaction costs in connection with any intended initial Business Combination,
our Sponsor or an affiliate of our Sponsor or certain of our officers and
directors may, but are not obligated to, loan us funds. If we complete our
initial Business Combination, we may repay such loaned amounts out of the
proceeds of the Trust Account released to us. In the event that our initial
Business Combination does not close, we may use a portion of the working capital
held outside the Trust Account to repay such loaned amounts but no proceeds from
our Trust Account would be used for such repayment. Up to
We expect our primary liquidity requirements during that period to include
approximately
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 have not consummated our initial Business Combination within the required time period because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the Trust Account.
Based on the foregoing, we believe that we will have sufficient working capital
and borrowing capacity from the Sponsor or an affiliate of the Sponsor, or
certain of our officers and directors to meet our needs through the consummation
of a Business Combination. However, in connection with our assessment of going
concern considerations in accordance with
Commitments and Contractual Obligations
Registration and Shareholder Rights
The holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans) are entitled to registration rights pursuant to a registration and shareholder rights agreement signed upon the effective date of the Initial Public Offering. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders have certain "piggy-back" registration rights with respect to registration statements filed subsequent to the Company's completion of the initial Business Combination. However, the registration and shareholder rights agreement provides that we will not permit any registration statement filed under the Securities Act to become effective until termination of the applicable lock-up periods with respect to such securities. We will bear the expenses incurred in connection with the filing of any such registration statements.
22 Underwriting Agreement
The underwriter was entitled to an underwriting discount of
Critical Accounting Policies and Estimates
This management's discussion and analysis of our financial condition and results
of operations is based on our condensed financial statements, which have been
prepared in accordance with accounting principles generally accepted in
Recent Accounting Pronouncements
In
Our management does not believe that any other recently issued, but not yet effective, accounting standards updates, if currently adopted, would have a material effect on the accompanying unaudited condensed financial statements.
JOBS Act
The Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an "emerging growth company" and under the JOBS Act are 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, the financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an "emerging growth company," we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor's attestation report on our system of internal controls over financial reporting pursuant to Section 404, (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 auditor's report 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 CEO'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.
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