References to "we", "us", "our" or the "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, 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 newly organized blank check company incorporated as a
Our sponsor is
Simultaneously with the closing of the initial public offering, we consummated
the private placement ("Private Placement") of 6,000,000 warrants, at a price of
Upon the closing of the initial public offering and the Private Placement,
If we are unable to complete an initial Business Combination within the
Combination Period, 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 its franchise and income taxes as well as
expenses relating to the administration of the Trust Account (less up to
19 Results of Operations
As of
For the three months ended
For the six months ended
For the three months ended
For the six months ended
Liquidity and Going Concern
As of
Until the consummation of a Business Combination, the Company will be using the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to acquire, and structuring, negotiating and consummating the Business Combination.
In order to finance transaction costs in connection with a Business Combination,
the Company's Sponsor or an affiliate of the Sponsor or certain of the Company's
officers and directors committed to provide the Company with Working Capital
Loans up to
If the Company's estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination are less than the actual amount necessary to do so, the Company may have insufficient funds available to operate its business prior to the Business Combination. Moreover, the Company may need to obtain additional financing either to complete its Business Combination or because it becomes obligated to redeem a significant number of its public shares upon consummation of the Business Combination, in which case the Company may issue additional securities or incur debt in connection with such Business Combination. Subject to compliance with applicable securities laws, the Company would only complete such financing simultaneously with the completion of the Business Combination. If the Company is unable to complete its Business Combination because it does not have sufficient funds available to it, the Company will be forced to cease operations and liquidate the Trust Account. In addition, following the Business Combination, if cash on hand is insufficient, the Company may need to obtain additional financing in order to meet its obligations.
We cannot assure you that our plans to raise capital or to consummate an initial business combination will be successful. These factors, among others, raise substantial doubt about our ability to continue as a going concern, which is considered to be one year from the issuance of the financial statements. The financial statements contained elsewhere in this Quarterly Report do not include any adjustments that might result from our inability to continue as a going concern.
In connection with the Company's assessment of going concern considerations in
accordance with FASB's Accounting Standards Update ("ASU") 2014-15, "Disclosures
of Uncertainties about an Entity's Ability to Continue as a Going Concern,"
management has determined that if the Company is unable to complete a Business
Combination by
20 Underwriters agreement
We granted the underwriters a 45-day option from the date of this initial public
offering to purchase up to an additional 2,250,000 units to cover
over-allotments, if any. On
Simultaneously with the closing of the initial public offering and the
over-allotment, the underwriters were paid an underwriting discount of 2% of the
gross proceeds of the initial public offering and the over-allotment, or
Contractual Obligations
As of
Critical Accounting Policies Use of Estimates
The preparation of financial statements and related disclosures in conformity
with GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, disclosure of contingent assets and
liabilities at the date of the financial statements, and income and expenses
during the periods reported. Making estimates requires management to exercise
significant judgment. It is possible that the estimates management considered
could possibly change due to one or more future events. The most significant
estimates that affected the financial statements as of
Offering Costs associated with the Initial Public Offering
Offering costs consist of underwriting, legal, accounting and other expenses
incurred through the balance sheet date that are directly related to the IPO. We
comply with the requirements of the ASC 340-10-S99-1 and
Class A Common Stock Subject to Possible Redemption
We account for the Class A common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 "Distinguishing Liabilities from Equity." Common stock subject to mandatory redemption (if any) are classified as a liability instrument and measured at fair value. Conditionally redeemable common stock (including common stock that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company's control) are classified as temporary equity. At all other times, common stock is classified as stockholders' equity.
We recognize changes in redemption value immediately as they occur. Immediately upon the closing of the IPO, we recognized the subsequent re-measurement under ASC 480-10-S99 from initial carrying amount to redemption value. The change in the carrying value of redeemable common stock resulted in charges against additional paid-in capital and accumulated deficit.
Net Loss Per Common stock
We have two classes of common stock, which are referred to as Class A common
stock and Class B common stock. Income and losses are allocated on pro rata
basis between redeemable and non-redeemable common stock. The 19,612,500
potential common shares for outstanding warrants to purchase our stock were
excluded from diluted earnings per share for the three and six months ended
21
Recent Accounting Pronouncements
In
In
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 the accompanying unaudited condensed financial statement.
Off-Balance Sheet Arrangements; Commitments and Contractual Obligations
Registration Rights
The holders of the Founder Shares, Private Placement Warrants and warrants that
may be issued upon conversion of Working Capital Loans (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) will be entitled to registration rights
pursuant to a registration rights agreement to be signed prior to or on the
effective date of the initial public offering, requiring us to register such
securities for resale (in the case of the Founder Shares, only after conversion
to our Class A common stock). The holders of the majority 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 and rights to require us to
register for resale such securities pursuant to Rule 415 under the Securities
Act. However, the registration 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 period, which occurs (i) in the case
of the Founder Shares, on the earlier of (A) six months after the completion of
the initial Business Combination or (B) subsequent to the initial Business
Combination, (x) if the last sale price of our Class A common stock equals or
exceeds
Underwriters Agreement
We granted the underwriters a 45-day option from the date of this initial public
offering to purchase up to an additional 2,250,000 units to cover
over-allotments, if any. On
Simultaneously with the closing of the initial public offering and the
over-allotment, the underwriters were paid an underwriting discount of 2% of the
gross proceeds of the initial public offering and the over-allotment, or
22 JOBS Act
On
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 this offering or until we are no longer an "emerging growth company," whichever is earlier.
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