References in this report (the "Quarterly Report") to "we," "us" or the
"Company" refer to IX Acquisition Corp. References to our "management" or our
"management team" refer to our officers and directors, and references to the
"Sponsor" refer to IX Acquisition Sponsor, LLC. References to "anchor investors"
refer to the 16 qualified institutional buyers or institutional accredited
investors, each of which is not affiliated with us, our Sponsor, our directors
or any member of our management, that purchased an aggregate of 115% of the
Units and an aggregate of 1,747,879 Class B ordinary shares. The following
discussion and analysis of the Company's financial condition and results of
operations should be read in conjunction with the unaudited condensed 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" 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 Quarterly Report
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 (as defined below) filed with the U.S. Securities and Exchange
Commission (the "SEC"). The Company's securities filings can be accessed on the
EDGAR section of the SEC's website at www.sec.gov. Except as expressly required
by applicable securities law, the Company disclaims any intention or obligation
to update or revise any forward-looking statements whether as a result of new
information, future events or otherwise.
Overview
We are a blank check company incorporated on March 1, 2021 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 businesses or entities. We have not selected any Business
Combination target and we have not, nor has anyone on our behalf, initiated any
substantive discussions, directly or indirectly, with any Business Combination
target. We intend to effectuate our initial Business Combination using cash from
the proceeds of our Initial Public Offering and the sale of the Private
Placement Warrants, the proceeds of the sale of our shares in connection with
our initial Business Combination pursuant to the forward purchase agreements (or
backstop agreements we may enter into or otherwise), shares issued to the owners
of the target, debt issued to bank or other lenders or the owners of the target,
or a combination of the foregoing or other sources.
The registration statement for our Initial Public Offering was declared
effective on October 6, 2021. On October 12, 2021, we consummated the Initial
Public Offering of 23,000,000 Units, including 3,000,000 Units that were issued
pursuant to the underwriter's exercise of its over-allotment option in full, at
$10.00 per Unit, generating total gross proceeds of $230,000,000.
Simultaneously with the closing of the Initial Public Offering, we consummated
the sale of 7,150,000 Private Placement Warrants at a price of $1.00 per Private
Placement Warrant in a private placement to our Sponsor, Cantor and Odeon
generating gross proceeds of $7,150,000.
Upon the closing of the Initial Public Offering on October 12, 2021, an amount
of $231,150,000 from the net proceeds of the sale of the Units in the Initial
Public Offering and the sale of the Private Placement Warrants was placed in a
the Trust Account and invested only in U.S. government treasury obligations with
maturities of 185 days or less or in money market funds meeting certain
conditions under Rule 2a-7 under the Investment Company Act which invest only in
direct U.S. government treasury obligations, until the earlier of: (i) the
completion of the initial Business Combination; (ii) the redemption of any
Public Shares properly tendered in connection with a shareholder vote to amend
the Amended and Restated Memorandum and Articles of Association to modify the
substance or timing of the Company's obligation to redeem 100% of the Public
Shares if the Company does not complete the initial Business Combination within
18 months from the closing of the Initial Public Offering (by April 12, 2023);
and (iii) absent an initial Business Combination
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within 18 months from the closing of the Initial Public Offering (by April 12,
2023) assuming there is no amendment to the Amended and Restated Memorandum and
Articles of Association to extend the period of time to consummate a Business
Combination or with respect to any other material provisions relating to
shareholders' rights or pre-initial Business Combination activity, the return of
the funds held in the Trust Account to the public shareholders as part of the
redemption of the Public Shares.
Going Concern Consideration
As of March 31, 2022, we had $402,607 in cash held outside of the Trust Account
and a working capital deficit of $137,308. We have incurred and expect to
continue to incur significant costs in pursuit of our acquisition plans. In
connection with our assessment of going concern considerations in accordance
with FASB ASC Topic 205-40, "Presentation of Financial Statements - Going
Concern," we have until April 12, 2023 to consummate a Business Combination. It
is uncertain that we will be able to consummate a Business Combination by this
time, and if a Business Combination is not consummated by this date, then there
will be a mandatory liquidation and subsequent dissolution of our company.
Our management has determined that the liquidity condition and mandatory
liquidation, should a Business Combination not occur, and potential subsequent
dissolution raises substantial doubt about our ability to continue as a going
concern for a period of time within one year after the date that the unaudited
condensed financial statements are issued.
We plan to address this uncertainty through the initial Business Combination.
There is no assurance that our plans to consummate the initial Business
Combination will be successful or successful within 18 months from the Initial
Public Offering (by April 12, 2023). The unaudited condensed financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
Risks and Uncertainties
Our management continues to evaluate the impact of the COVID-19 pandemic and has
concluded that while it is reasonably possible that the virus could have a
negative effect on our financial position, results of its operations, and/or
search for a target company, the specific impact is not readily determinable as
of the date of the unaudited condensed financial statements. The unaudited
condensed financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
In February 2022, the Russian Federation commenced a military action with the
country of Ukraine. As a result of this action, various nations, including the
United States, have instituted economic sanctions against the Russian
Federation. Further, the impact of this action and related sanctions on the
world economy are not determinable as of the date of these unaudited condensed
financial statements. The specific impact on our financial condition, results of
operations, and cash flows is also not determinable as of the date of unaudited
condensed financial statements.
Results of Operations
Our entire activity since inception up to March 31, 2022 related to our
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. We will not be generating any operating revenues until the
closing and completion of our initial Business Combination, at the earliest. We
will generate non-operating income in the form of interest income from the
amount held in the Trust Account.
For the three months ended March 31, 2022, we had a net income of $3,667,570,
which consisted of a gain of $4,059,500 from the change in fair value of
derivative warrant liabilities and an $39,303 in unrealized gain on investments
held in Trust Account, and interest income on operating account of $35, which
were partially offset by $431,268 in operating and formation expenses (of which
$30,000 was for related party administrative fees).
For the period from March 1, 2021 (inception) through March 31, 2021, we had net
loss of $5,500, which consisted entirely of formation and operating costs.
Off-Balance Sheet Arrangements
As of March 31, 2022, we did not have any off-balance sheet arrangements.
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Contractual Obligations
Registration Rights Agreement
The holders of the Founder Shares, Private Placement Warrants and 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
issued upon conversion of working capital loans) are entitled to registration
rights pursuant to a registration rights agreement signed on the effective date
of the registration statement for the Company's Initial Public Offering. The
holders of these securities are entitled to make up to three demands, excluding
short form demands, that the Company register such securities. In addition, the
holders have certain "piggy-back" registration rights with respect to
registration statements filed subsequent to consummation of a Business
Combination. We have granted Cantor and Odeon or their designees or affiliates
certain registration rights relating to these securities. The underwriters may
not exercise their demand and "piggyback" registration rights after five and
seven years, respectively, after the effective date of the registration
statement relating to the Initial Public Offering and may not exercise demand
rights on more than one occasion. The Company bears the expenses incurred in
connection with the filing of any such registration statements.
Underwriters Agreement
In connection with the Initial Public Offering, the underwriters were granted a
45-day option from the date of the prospectus to purchase up to 3,000,000
additional Units to cover over-allotments. On October 12, 2021, the underwriters
fully exercised the over-allotment option to purchase an additional 3,000,000
Units at an offering price of $10.00 per Unit, generating additional gross
proceeds of $30,000,000 to the Company.
The underwriters were paid a cash underwriting discount of $0.20 per Unit
(excluding over-allotment Units) in the Initial Public Offering, or $4,000,000
in the aggregate upon the closing of the Initial Public Offering. In addition,
$0.50 per Unit (excluding over-allotment Units), and $0.70 per over-allotment
Unit (totaling $12,100,000 in aggregate) is payable to the underwriters for
deferred underwriting commission. The deferred fee is payable to the
underwriters from the amounts held in the Trust Account solely in the event that
the Company completes a Business Combination, subject to the terms of the
underwriting agreement.
Administrative Support Agreement
On October 6, 2021, we entered into an agreement with IX Acquisition Services
LLC, an entity owned by an affiliate of our sponsor, to pay a total of $10,000
per month for office space, secretarial and administrative services. Upon
completion of a Business Combination or the Company's liquidation, we will cease
paying these monthly fees. During the three months ended March 31, 2022 and for
the period from March 1, 2021 (inception) through March 31, 2021, we incurred
expenses in connection with such services of $30,000 and $0, respectively,
included within operating and formation expenses on the accompanying unaudited
condensed statements of operations.
Critical Accounting Policies and Estimates
The preparation of the unaudited condensed 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 unaudited 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 April 13, 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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