References to the "Company," "Go Acquisition Corp.," "Go," "our," "us" or "we"
refer to Go Acquisition Corp. The following discussion and analysis of the
Company's financial condition and results of operations should be read in
conjunction with the unaudited interim condensed financial statements and the
notes thereto contained elsewhere in this report. Certain information contained
in the discussion and analysis set forth below includes forward-looking
statements that involve risks and uncertainties.
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of 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
SEC filings.
Overview
We are a blank check company incorporated on June 12, 2020 as a Delaware company
for the purpose of effecting a merger, capital stock exchange, asset
acquisition, stock purchase, reorganization or similar business combination with
one or more businesses (the "Business Combination"). Although we may pursue
targets in any industry, the Company intends to focus its efforts on
travel-related and travel-adjacent businesses with either all or a substantial
portion of their activities in North America or Europe. We intend to effectuate
our initial Business Combination using cash from the proceeds of the Initial
Public Offering and the sale of the Private Placement Warrants, our capital
stock, debt or a combination of cash, stock and debt. We are an emerging growth
company and, as such, we are subject to all of the risks associated with
emerging growth companies.
Our Sponsor is GO Acquisition Founder LLC, a Delaware limited liability company.
Our registration statement for the Initial Public Offering was declared
effective on August 4, 2020. On August 7, 2020, we consummated the Initial
Public Offering of 50,000,000 Units, at $10.00 per Unit, generating gross
proceeds of $500.0 million, and incurring offering costs of approximately
$28.1 million, inclusive of $17.5 million in deferred underwriting commissions.
On September 21, 2020, the underwriter exercised the over-allotment option in
full to purchase an additional 7,500,000 Units (the "Over-Allotment Units"),
generating gross proceeds of $75.0 million (the "Over-Allotment"), and incurred
additional offering costs of approximately $4.1 million in underwriting fees
(inclusive of approximately $2.6 million in deferred underwriting fees).
Simultaneously with the closing of the Initial Public Offering on August 7,
2020, we consummated the Private Placement of an aggregate of 8,000,000 Private
Placement Warrants at a price of $1.50 per Private Placement Warrant to our
Sponsor, generating proceeds of $12.0 million. Simultaneously with the closing
of the Over-Allotment Units, on September 21, 2020, the Company consummated the
second closing of the Private Placement, resulting in the purchase of an
aggregate of an additional 1,000,000 Private Placement Warrants by the Sponsor,
generating gross proceeds to the Company of $1.5 million.
Upon the closing of the Initial Public Offering, the Over-Allotment and the
Private Placement, $575.0 million ($10.00 per Unit) of the net proceeds of the
sale of the Units in the Initial Public Offering and of the Private Placement
Warrants in the Private Placement were placed in the Trust Account located in
the United States at JP Morgan Chase Bank, N.A. with Continental Stock
Transfer & Trust Company acting as trustee, and invested 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, as
determined by the Company, until the earlier of: (i) the completion of a
Business Combination and (ii) the distribution of the Trust Account as described
below.
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Our management has broad discretion with respect to the specific application of
the net proceeds of the Initial Public Offering and the sale of the Private
Placement Warrants, although substantially all of the net proceeds are intended
to be applied generally toward consummating a Business Combination.
If we are unable to complete a Business Combination within the Combination
Period (24 months from the closing of the Initial Public Offering, or August 7,
2022, as may be extended by approval of our stockholders), we will (i) cease all
operations except for the purpose of winding up; (ii) as promptly as reasonably
possible but not more than ten business days thereafter, redeem the Public
Shares, at a per-share price, payable in cash, equal to the aggregate amount
then on deposit in the Trust Account including interest earned on the funds held
in the Trust Account and not previously released to us to pay taxes, if any
(less up to $100,000 of interest to pay dissolution expenses), divided by the
number of the then outstanding Public Shares, which redemption will completely
extinguish Public Stockholders' rights as stockholders (including the right to
receive further liquidation distributions, if any), subject to applicable law;
and (iii) as promptly as reasonably possible following such redemption, subject
to the approval of the remaining stockholders and our board of directors,
liquidate and dissolve, subject in each case, to our obligations under Delaware
law to provide for claims of creditors and the requirements of other applicable
law.
Liquidity and Going Concern Consideration
At March 31, 2022, we had cash of approximately $67,000 and working capital
deficit of approximately $2.6 million.
Our liquidity needs since inception had been satisfied through the cash receipt
of $25,000 from our Sponsor to purchase the Founder Shares, and a loan of
$200,000 pursuant to a note issued to our Sponsor (the "Note"). Subsequent to
the consummation of the Initial Public Offering, our liquidity needs have been
satisfied with the net proceeds from the consummation of the Private Placement
not held in the Trust Account. The Note remains unpaid to date and is due on
demand. In addition, in order to finance transaction costs in connection with a
Business Combination, our Sponsor or its affiliates may, but are not obligated
to, provide us working capital loans ("Working Capital Loans"). To date, there
is $600,000 outstanding under Working Capital Loans.
In connection with our assessment of going concern considerations in accordance
with Financial Accounting Standard Board's Accounting Standards Update ("ASU")
2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as
a Going Concern," we have until August 7, 2022 to consummate the proposed
Business Combination. We do not have adequate liquidity to sustain operations,
however, our management believes that we have access to funds pursuant to a
commitment letter from our Sponsor that will enable us to sustain operations
until we complete our initial Business Combination. If a business combination is
not consummated by this date, there will be a mandatory liquidation and
subsequent dissolution. Management has determined that the mandatory
liquidation, should a business combination not occur, and potential subsequent
dissolution, raises substantial doubt about our ability to continue as a going
concern. No adjustments have been made to the carrying amounts of assets or
liabilities should we be required to liquidate after August 7, 2022. We intend
to complete the proposed Business Combination before the mandatory liquidation
date. However, there can be no assurance that we will be able to consummate any
business combination by August 7, 2022.
Our management continues to evaluate the impact of the COVID-19 pandemic and has
concluded that the specific impact is not readily determinable as of the date of
the financial statements. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
Results of Operations
Our entire activity from inception up to December 31, 2021 was in preparation
for our Initial Public Offering and, since the consummation of our Initial
Public Offering, the search for a prospective target business. We will not
generate any operating revenues until the closing and completion of our initial
Business Combination, at the earliest.
For the three months ended March 31, 2022, we had net income of approximately
$13.3 million, which consisted of an approximately $13.5 million in change in
fair value of derivative warrant liabilities, and approximately $180,000 of net
gain from investments held in Trust Account, partially offset by approximately
$423,000 of loss from operations including approximately $373,000 of general and
administrative expenses and approximately $50,000 of franchise tax expense. In
addition, an increase in the redemption value of our Class A common stock
resulted in a reduction to net income available to stockholders by approximately
$112,000.
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For the three months ended March 31, 2021, we had net income of approximately
$17.0 million, which consisted of an approximately $17.1 million in change in
fair value of derivative warrant liabilities, and approximately $96,000 of net
gain from investments held in Trust Account, partially offset by approximately
$171,000 of loss from operations including approximately $122,000 of general and
administrative expenses and approximately $49,000 of franchise tax expense.
Contractual Obligations
Registration Rights
The holders of Founder Shares, Private Placement Warrants and warrants that may
be issued upon conversion of Working Capital Loans, if any (and any shares of
Class A common stock issuable upon the exercise of the Private Placement
Warrants and warrants that may be issued upon conversion of Working Capital
Loans and upon conversion of the Founder Shares), are entitled to registration
rights pursuant to a registration rights agreement. 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 completion of the initial Business Combination. We will bear
the expenses incurred in connection with the filing of any such registration
statements.
Underwriting Agreement
We granted the underwriters a 45-day option from the final prospectus relating
to the Initial Public Offering to purchase up to 7,500,000 additional Units to
cover over-allotments, if any, at the Initial Public Offering price less the
underwriting discounts and commissions. The underwriters fully exercised their
over-allotment option on September 21, 2020.
The underwriters were entitled to an underwriting discount of $0.20 per Unit, or
$11.5 million in the aggregate, paid upon the closing of the Initial Public
Offering and Over-Allotment. In addition, the underwriters will be entitled to a
deferred fee of $0.35 per Unit, or $20.1 million in the aggregate. The deferred
fee will become payable to the underwriters from the amounts held in the Trust
Account solely in the event that we complete a Business Combination, subject to
the terms of the underwriting agreement.
Critical Accounting Polices and Estimates
The preparation of financial statements in accordance with accounting principles
generally accepted in the United States of America requires management to make
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses. A summary of our significant accounting policies is
included in Note 2 to our condensed financial statements in Part I, Item 1 of
this Quarterly Report. Certain of our accounting policies are considered
critical, as these policies are the most important to the depiction of our
condensed financial statements and require significant, difficult or complex
judgments, often employing the use of estimates about the effects of matters
that are inherently uncertain. Such policies are summarized in the Management's
Discussion and Analysis of Financial Condition and Results of Operations section
in our 2021 Annual Report on Form 10-K filed with the SEC on March 30, 2022.
There have been no significant changes in the application of our critical
accounting policies during the three months ended March 31, 2022.
Recent Accounting Pronouncements
See Note 2 to the unaudited condensed financial statements included in Part I,
Item 1 of this Quarterly Report for a discussion of recent accounting
pronouncements.
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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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