References to "we," "us," "company" or "our company" are to
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 (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 otherU.S. Securities and Exchange Commission ("SEC") filings. 18
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Overview
We are a blank check company incorporated as a
We currently intend to concentrate our efforts in identifying businesses in the
industrial technology, advanced materials or specialty chemicals industries
(collectively, "Advanced Industrials"). A common theme across these sectors is
the application of technology to make industrial processes more profitable,
faster, more sustainable, less capital-intensive and less complex. Specifically,
we intend to identify businesses that apply innovative technology to
engineering, production, assembly and manufacturing. These innovations include a
wide range of automation, analytics and productivity tools, as well as control
systems, high precision technologies, sustainability technologies, high
performance computing and robotics. These technologies enable companies to
confront numerous challenges inherent in their daily operations, such as rising
wage rates, globalization, increased regulation, higher quality standards,
heightened focus on sustainability and tighter timelines. We are also interested
in companies that participate in market segments that are adjacent to Advanced
Industrials. We believe that there are many potential targets within Advanced
Industrials that could become attractive public companies. These potential
targets exhibit a broad range of business models and financial characteristics,
with enterprise values ranging between
We are not, however, required to complete our initial business combination with an Advanced Industrials business and, as a result, we may pursue a business combination outside of this industry. We are seeking to acquire a mature businesses that we believe are fundamentally sound, yet which could benefit from additional financial, operational, strategic or managerial resources to achieve maximum value potential. We are also targeting earlier stage, yet established, companies that exhibit the potential to disrupt the market segments in which they participate through innovation and which offer the potential of sustained high levels of revenue growth.
Our sponsor is affiliated with and controlled by Mason Capital, a registered
investment adviser under the Investment Advisers Act of 1940, as amended, which
was established in 2000 and had over
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. All activity from our inception through the date of our IPO,February 2, 2021 , was in preparation for our IPO. Since our IPO, our activity has been limited to the evaluation of Business Combination candidates. We do not expect to generate any operating revenues until the closing and completion of our Business Combination. We expect to generate non-operating income in the form of interest income on marketable securities held after the IPO. We 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.
Comparison of the three months ended
For the three months ended
For the three months ended
Comparison of the six months ended
For the six months ended
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For the six months ended
As described in Note 2, Summary of Significant Accounting Policies , in "Part 1. Financial Information - Item 1. Financial Statements," we account for (i) the Warrants issued in connection with our IPO and Private Placement and (ii) the forward purchase agreement as derivative instruments which were initially recorded at their fair value. These derivative instruments are subject to remeasurement at each balance sheet date until exercised, and any change in fair value is recognized in our statements of operations.
Liquidity and Capital Resources
As of
As of
Material cash requirements
As of
The underwriters are entitled to deferred fee of 3.5% of the gross proceeds of
the Public Offering, or
Sources of cash
Prior to the completion of the IPO, our liquidity needs were satisfied through
receipt of
On
On
Uses of cash Six Months Ended June 30, 2022 2021 Change
Net cash used in operating activities
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For the six months ended
For the six months ended
In order to fund working capital deficiencies and/or finance transaction costs
in connection with an 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 as may be required. If we complete our initial
Business Combination, we would repay such loaned amounts. 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
As ofJune 30, 2022 andDecember 31, 2021 , the Company had$227,091 and$975,393 in cash not held in the Trust Account and available for working capital purposes, respectively. The Company believes it will need to raise additional funds in order to meet the expenditures required for operating the business. If the Company's 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, the Company may have insufficient funds available to operate the business prior to the Initial Business Combination. Moreover, the Company may need to obtain additional financing either to complete the Initial Business Combination or to redeem a significant number of our public shares upon completion of the Initial Business Combination, in which case the Company may issue additional securities or incur debt in connection with such Initial Business Combination. If the Company is unable to complete the Business Combination because it does not have sufficient funds available, the Company will be forced to cease operations and liquidate the Trust Account. In connection with the Company's assessment of going concern considerations in accordance withFinancial Accounting Standards Board's ("FASB") Accounting Standards Codification ("ASC") Topic 205-40, Presentation of Financial Statements-Going Concern, the Company has untilFebruary 23, 2023 , to consummate an initial business combination. It is uncertain that the Company will be able to consummate an initial business combination by this time. If an initial business combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the Company. Additionally, the Company may not have sufficient liquidity to fund the working capital needs of the Company through one year from the issuance of these financial statements. Management has determined that the liquidity condition and mandatory liquidation, should an initial business combination not occur, and potential subsequent dissolution raises substantial doubt about the Company's ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate afterFebruary 2, 2023 . The Company's sponsor, officers and directors may, but are not obligated to, loan the Company funds from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company's working capital needs.
Related Party Transactions
Please refer to Note 6, Related Party Transactions , in "Part 1. Financial Information - Item 1. Financial Statements" for a discussion of our related party transactions.
Critical Accounting Policies and Estimates
Our management makes a number of significant estimates, assumptions and judgments in the preparation of our financial statements. See "Note 2 -Summary of Significant Account Policies" in our 2021 Form 10-K, for a discussion of the estimates and judgments necessary in our accounting for common stock subject to possible redemption, and net income per common share. Any new accounting policies or updates to existing accounting policies as a result of new accounting pronouncements have been included in the notes to our condensed financial statements contained in this Quarterly Report on Form 10-Q. The application of our critical accounting policies may require management to make judgments and estimates about the amounts reflected in the condensed financial statements. Management uses historical experience and all available information to make these estimates and judgments. Different amounts could be reported using different assumptions and estimates. 21
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Recent Accounting Pronouncements
Please refer to Note 2, Summary of Significant Accounting Policies , in "Part 1. Financial Information - Item 1. Financial Statements" for a discussion of recent accounting pronouncements and their anticipated effect on our business. Effects of COVID-19 on Our Business
Management is continuing 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 the Company's financial position, results of its operations and search for a target company, the specific impacts are not readily determinable as of the date of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
JOBS Act
OnApril 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 qualify as an "emerging growth company" under the JOBS Act and are allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We elected 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. As an "emerging growth company", we are not 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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