DP CAP ACQUISITION CORP I References in this Item 7 to our "management" or our "management team" refer to our officers and directors. The following discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Annual Report on Form 10-K (the "Financial Statements"). Capitalized terms used but not otherwise defined herein have the meaning set forth in the Financial Statements. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under "Special Note Regarding Forward-Looking Statements," "Item 1A. Risk Factors" and elsewhere in this Annual Report on Form 10-K.
Overview
We are a blank check company incorporated on
We presently have no revenue and have had no operations other than the active solicitation of a target business with which to complete a Business Combination.
We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.
Results of Operations
For the period from
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All activity for the period from
Liquidity and Capital Resources
Prior to the closing of the Public Offering, our only sources of liquidity were
an initial sale of Founder Shares to our Sponsor and the proceeds of an
unsecured promissory note from our Sponsor, in the amount of
The registration statement for our Public Offering was declared effective by the
Following the Public Offering, the sale of the Private Placement Warrants and
the issuance of the proceeds under the Sponsor Loan, a total of
For the period from
As of
As of
In order to fund working capital deficiencies or finance transaction costs in connection with a 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 a Business Combination, we would repay such loaned amounts. In the event that a Business Combination does not close, we may use a portion of the cash held outside the Trust Account to repay such loaned amounts, but no proceeds from our Trust Account would be used for such repayment.
We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our 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, we may have insufficient funds available to operate our business prior to our Business Combination. Moreover, we may need to obtain additional financing either to complete our Business Combination or because we become obligated to redeem a significant number of our public shares upon completion of our Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination.
At
Commitments and Contingencies
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Registration Rights
The holders of 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 the working capital loans) will be
entitled to registration rights pursuant to a registration rights agreement. The
holders of these securities will be entitled to make up to three demands,
excluding short form demands, that we register such securities. In addition, the
holders will have certain "piggy-back" registration rights with respect to
registration statements filed subsequent to our completion of our Business
Combination. 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 lockup period, which occurs (i) in
the case of the Founder Shares, until the earliest of (A) one year after the
completion of our initial business combination and (B) subsequent to our
Business Combination, (x) if the closing price of our Class A ordinary shares
equals or exceeds
Underwriting Agreement
We granted the underwriter a 45-day option from the date of the Public Offering
to purchase on a pro rata basis up to 3,000,000 additional Units to cover
over-allotments, if any, at the Public Offering price, less the underwriting
discounts and commissions. The over-allotment option was exercised in full on
The underwriter was entitled to an underwriting discount of
Critical Accounting Policies
The preparation of our Financial Statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities and expenses and the disclosure of contingent assets and liabilities in our Financial Statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments and accrued expenses. We base our estimates on known trends and events and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We have identified the following as our critical accounting policies:
Investments Held in the Trust Account
Upon consummation of the Public Offering, our portfolio of investments is
comprised solely of
Warrant Classification
We account for warrants as either equity-classified or liability-classified
instruments based on an assessment of the warrant's specific terms and
applicable authoritative guidance in
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For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance.
Class A Ordinary Shares Subject to Possible Redemption
We account for our Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480. Class A ordinary shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable Class A ordinary shares (including Class A ordinary shares 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 our control) are classified as temporary equity. At all other times, Class A ordinary shares are classified as shareholders' equity. Our Class A ordinary shares feature certain redemption rights that are considered to be outside of our control and subject to the occurrence of uncertain future events.
Net Loss Per Ordinary Share
We comply with the accounting and disclosure requirements of FASB ASC Topic 260, "Earnings Per Share." Net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of Class A ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture. We have not considered the effect of the warrants sold in the Public Offering and private placement to purchase an aggregate of 16,233,333 shares in the calculation of diluted loss per share, since the inclusion of such warrants would be anti-dilutive. Warrants granted upon conversion of the convertible note would also be anti-dilutive and are thus excluded from the calculation.
Our statement of operations includes a presentation of loss per share for ordinary shares subject to possible redemption in a manner similar to the two-class method of loss per share. Consistent with ASC Topic 480-10-S99-3A, remeasurement associated with the redeemable ordinary shares is excluded from earnings per share as the redemption value approximates its fair value. The calculation of diluted income per ordinary share does not consider the effect of the warrants issued since the exercise of the warrants are contingent upon the occurrence of future events. However, the diluted earnings per share calculation includes the shares subject to forfeiture from the first day of the interim period in which the contingency on such shares was resolved, if dilutive.
Recent Accounting Pronouncements
In
The Company's management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the accompanying financial statements.
Inflation
We do not believe that inflation had a material impact on our business or operating results during the period presented.
JOBS Act
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.
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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 of the
Sarbanes-Oxley Act, (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
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