References to the "Company," "
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 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 on
Our sponsor is
We issued 158,125 shares of Class A common stock, with a fair value of
Simultaneously with the closing of the IPO, we consummated the sale of an
aggregate of 6,027,500 warrants (the "Private Placement Warrants") at a price of
17
Upon the closing of the Initial Public Offering and the Private Placement, an
amount of
Our management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination.
We will have only 12 months from the closing of the IPO (or 21 months from the
closing of the IPO if we extend the period of time to consummate the initial
Business Combination) (the "Combination Period") to complete the initial
Business Combination. However, if we anticipate that we may not be able to
consummate the initial Business Combination within 12 months, we may extend the
period of time to consummate a Business Combination by up to three additional
three-month periods (up to a maximum of 21 months from the closing of the IPO).
Pursuant to the terms of our certificate of incorporation and the trust
agreement entered into between us and
Liquidity and Capital Resources
As of
Our liquidity needs up to
18
Based on the foregoing, management believes that we will have sufficient working capital and borrowing capacity to meet our needs through the earlier of the consummation of a Business Combination or one year from IPO filing. Over this time period, we will be using these funds for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
Risks and Uncertainties
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 these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Results of Operations
As of
For the period from
Contractual Obligations
We do not have any long-term debt obligations, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities.
Administrative Services Agreement
Commencing on the date that our securities are first listed on the NASDAQ
Capital Market, we agreed to pay the Sponsor
Registration Rights
The holders of the founder shares, representative's common stock, 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 dated
19 Underwriting Agreement
The underwriter had a 45-day option from the date of the IPO to purchase up to
an aggregate of 1,650,000 additional Units at the public offering price less the
underwriting commissions to cover over-allotments, if any. On
The underwriter is entitled to a deferred underwriting discount of 3.6% of the
gross proceeds of the Initial Public Offering, which included the exercise of
the over-allotment, or
Critical Accounting Policies Deferred Offering Costs
We comply with the requirements of the ASC 340-10-S99-1. Deferred offering costs
consists of legal, accounting, underwriting fees and other costs incurred
through the balance sheet date that are directly related to the Public
Offering. Offering costs are allocated to the separable financial instruments
to be issued in the IPO based on a relative fair value basis, compared to total
proceeds received. Upon closing of the IPO on
Class A Common Stock Subject to Possible Redemption
We will account for our common stock subject to possible redemption in accordance with the guidance in FASB ASC Topic 480 "Distinguishing Liabilities from Equity." Class A common stock subject to mandatory redemption (if any) is classified as a liability instrument and measured at fair value. Conditionally redeemable common stock (including shares of 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) is classified as temporary equity. At all other times, common stock is classified as stockholders' equity. The Company's Class A common stock features certain redemption rights that are considered to be outside of the Company's control and subject to the occurrence of uncertain future events. Accordingly, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders' equity section of the Company's condensed balance sheet
Net Loss Per Common Share
We comply with the accounting and disclosure requirements of FASB ASC Topic 260,
"Earnings Per Share." Net loss per common share is computed by dividing net loss
by the weighted average number of shares of common stock outstanding during the
period, excluding common stock subject to forfeiture. Weighted average shares
were reduced for the effect of an aggregate of 412,500 shares of common stock
that are subject to forfeiture if the over-allotment option is not exercised by
the underwriter. At
Derivative Financial Instruments
We evaluated the financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, "Derivatives and Hedging". Derivative instruments are initially recorded at fair value on the grant date and re-valued at each reporting date, with changes in the fair value reported in the statements of operations. Derivative assets and liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date.
20 Warrant Liability
We evaluated the Public Warrants and Private Placement Warrants to be issued in the IPO (collectively, "Warrants") in accordance with ASC 815-40, "Derivatives and Hedging - Contracts in Entity's Own Equity", and concluded that a provision in the Warrant Agreement related to certain tender or exchange offers precludes the Warrants from being accounted for as components of equity. As the Warrants meet the definition of a derivative as contemplated in ASC 815, the Warrants will be recorded as derivative liabilities on the balance sheet and measured at fair value at inception (on the date of the IPO) and at each reporting date in accordance with ASC 820, "Fair Value Measurement", with changes in fair value recognized in the statement of operations in the period of change.
Off-Balance Sheet Arrangements
As of
Inflation
We do not believe that inflation had a material impact on our business, revenues or operating results during the period presented.
Emerging Growth Company Status
We are an "emerging growth company," as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our Business Startups Act of 2012, (the "JOBS Act"), and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
21
© Edgar Online, source