Forward-Looking Statements
This Quarterly Report on Form 10-Q contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995. All
statements other than statements of historical facts included in this Quarterly
Report on Form 10-Q, including, without limitation, statements regarding our or
our management team's expectations, hopes, beliefs, intentions or strategies
regarding the future, are forward-looking statements. Forward-looking statements
generally can be identified by the use of forward-looking terminology such as
"anticipate," "believe," "continue," "could," "estimate," "expect," "intend,"
"may," "might," "plan," "possible," "potential," "predict," "project," "should,"
"would" or the negative thereof or any variation thereon or similar terminology
or expressions.
We have based these forward-looking statements on our current expectations and
beliefs concerning future developments and their potential effects on us. These
forward-looking statements are not guarantees and 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. Important
factors which could materially affect our results and our future performance
include, without limitation:
• our ability to complete our initial business combination;
• our expectations around the performance of the prospective target business
or businesses;
• our success in retaining or recruiting, or changes required in, our
officers, key employees or directors following our initial business
combination;
• our officers and directors allocating their time to other businesses and
potentially having conflicts of interest with our business or in approving
our initial business combination, as a result of which they would then
receive expense reimbursements;
• our potential ability to obtain additional financing to complete our initial
business combination;
• our pool of prospective target businesses;
• the ability of our officers and directors to generate a number of potential
acquisition opportunities;
• our public securities' potential liquidity and trading;
• the lack of a market for our securities;
• the use of proceeds not held in the trust account or available to us from
interest income on the trust account balance;
• the trust account not being subject to claims of third parties; or
• our financial performance, and
• other factors set forth under "Item 1A. Risk Factors" in our Annual Report
on Form 10-K for the fiscal year ended December 31, 2020.
Except as required by law, we assume no duty to update or revise any
forward-looking statements.
Overview
LMF Acquisition Opportunities, Inc. (the "Company") was incorporated in Delaware
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"). The Company has not
selected any specific business-combination target and it has not, nor has anyone
on the Company's behalf, initiated any substantive discussions, directly or
indirectly, with any business-combination target.
The Company has selected December 31 as its fiscal year end.
As of September 30, 2021, the Company had not yet commenced any operations. All
activity for the period from October 27, 2020 (inception) through September 30,
2021 relates to the Company's formation and the initial public offering ("IPO")
described below. The Company will not generate any operating revenues until
after the completion of its initial Business Combination, at the earliest. The
Company will generate non-operating income in the form of interest income on
cash and cash equivalents from the proceeds derived from the IPO.
The registration statement for the Company's IPO was declared effective on
January 25, 2021 (the "Effective Date"). On January 28, 2021, the Company
consummated the IPO of 10,350,000 units (the "Units" and, with respect to the
shares of Class A common stock
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included in the Units sold, the "Public Shares"), at $10.00 per Unit, generating
gross proceeds of $103,500,000, which offering is further described in Note 6.
Simultaneously with the closing of the IPO, the Company consummated the sale of
5,738,000 warrants (the "Private Placement Warrants") at a price of $1.00 per
Private Placement Warrant in a private placement to LMFAO Sponsor LLC, a Florida
limited liability company (the "Sponsor"), generating gross proceeds of
$5,738,000.
Transaction costs for the IPO amounted to $6,233,747 consisting of $2,070,000 of
underwriting discount, $3,622,500 of deferred underwriting fee, the fair value
of the shares issued to the underwriters of $1,000 deemed as underwriters'
compensation, and $540,247 of other offering costs. In addition, $974,009 of
cash was held outside of the Trust Account (as defined below) as of the date of
the IPO and became available for working capital purposes at such time.
Following the closing of the IPO on January 28, 2021, an amount of $105,570,000
($10.20 per Unit) from the net proceeds of the sale of the Units in the IPO and
the sale of the Private Placement Warrants was placed in a trust account ("Trust
Account") which will be invested in U.S. government securities, within the
meaning set forth in Section 2(a)(16) of the Investment Company Act, with a
maturity of 180 days or less or in any open-ended investment company that holds
itself out as a money market fund meeting the conditions of Rule 2a-7 of the
Investment Company Act, as determined by the Company. Except with respect to
interest earned on the funds held in the Trust Account that may be released to
the Company to pay its franchise and income tax obligations (less up to $100,000
of interest to pay dissolution expenses), the proceeds from the IPO and the sale
of the Private Placement Warrants will not be released from the Trust Account
until the earliest of (a) the completion of the Company's initial Business
Combination, (b) the redemption of any Public Shares properly submitted in
connection with a stockholder vote to amend the Company's amended and restated
certificate of incorporation, and (c) the redemption of the Company's Public
Shares if the Company is unable to complete the initial Business Combination
within 18 months from the closing of the IPO (or up to 21 months from the
closing of the IPO if the Company extends the period of time to consummate a
business combination, as described in more detail in the prospectus for the
IPO), subject to applicable law. The proceeds deposited in the Trust Account
could become subject to the claims of the Company's creditors, if any, which
could have priority over the claims of the Company's public stockholders.
COVID-19 Update
A The significant outbreak of COVID-19 has resulted in a widespread health
crisis that could adversely affect the economies and financial markets
worldwide, and the business of any potential target business with which we
consummate a business combination could be materially and adversely affected. We
may be unable to complete a business combination if continued concerns relating
to COVID-19 restrict travel, limit the ability to have meetings with potential
investors, or the target company's personnel, vendors, and services providers
are unavailable to negotiate and consummate a transaction in a timely manner.
The extent to which COVID-19 impacts our search for a business combination will
depend on future developments, which are highly uncertain and cannot be
predicted, including new information that may emerge concerning the severity of
COVID-19 and the actions to contain COVID-19 or treat its impact, among others.
If the disruptions posed by COVID-19 or other matters of global concern continue
for an extensive period of time, our ability to consummate a business
combination, or the operations of a target business with which we ultimately
consummate a business combination, may be materially adversely affected.
Results of Operations for the Three Months Ended September 30, 2021
The Company's only activities since inception in October 28, 2020 through
September 30, 2021 were organizational activities and those necessary to
consummate the IPO. The Company does not expect to generate any operating
revenues until after the completion of the initial Business Combination.
Revenues
The Company had no revenues during the three months ended September 30, 2021.
Expenses
During the three months ended September 30, 2021, expenses were approximately
$411 thousand, and are associated with formation and administrative expenses.
Gain on Revaluation of Warrants
The Company recognized a $0.6 million gain upon the revaluation of the warrants
as of September 30, 2021.
Income Tax Expense
During the three months ended September 30, 2021, the Company did not incur any
income tax expense due to the Company being in a loss situation since
inception. As such, any benefits from the Company's operating loss is deferred
as it recognizes a taxation
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valuation allowance for the full amount. The Company did not recognize any
income tax expense for the three months ended September 30, 2020.
Net Income
During the three months ended September 30, 2021, net income was $236 thousand.
Such net income resulted from a revaluation of the Company's warrants.
Results of Operations for the Nine Months Ended September 30, 2021
The Company's only activities since inception in October 28, 2020 through
September 30, 2021 were organizational activities and those necessary to
consummate the IPO. The Company does not expect to generate any operating
revenues until after the completion of the initial Business Combination.
Revenues
The Company had no revenues during the Nine Months ended September 30, 2021
Expenses
During the Nine Months ended September 30, 2021, expenses were approximately
$747 thousand, and are associated with formation and administrative expenses.
Gain on Revaluation of Warrants
The Company recognized a $702 thousand gain upon the revaluation of the warrants
as of September 30, 2021.
Other Income
The Company's investments in U.S. government securities and money market fund
generated investment income of $4.4 thousand for the Nine Months ended September
30, 2021.
Income Tax Expense
During the Nine Months ended September 30, 2021, the Company did not incur any
income tax expense due to the Company being in a loss situation since
inception. As such, any benefits from the Company's operating loss is deferred
as it recognizes a taxation valuation allowance for the full amount. The Company
did not recognize any income tax expense for the nine months ended September 30,
2020.
Net Loss
During the Nine Months ended September 30, 2021, net loss was $40 thousand. Such
net loss resulted from a revaluation of the Company's warrants.
Liquidity and Capital Resources
General
As of September 30, 2021, we had cash and cash equivalents of $166 thousand.
Cash from Operations
Net cash used in operations was $373 thousand during the Nine Months ended
September 30, 2021 due to cash used for operating and formation costs.
Cash from Investing Activities
For the Nine Months ended September 30, 2021 net cash used in investing
activities was $105.6 million as the Company invested $105.6 million into its
Trust account.
Cash from Financing Activities
Net cash provided by financing activities was $106.1 million for the Nine Months
ended September 30, 2021 due to the $106.8 million generated by the Company's
IPO. The Company also paid $754 thousand during the period for director and
officer insurance premiums.
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Shareholders' Equity
During the Nine Months ended September 30, 2021, the Company issued 10.3 million
units, 0.4 million in Class B shares and 5.7 million Private Placement Warrants.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements.
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