References in this report (the "Quarterly Report") to "we," "us" or the "Company" refer to Alpha Partners Technology Merger Corp. References to our "management" or our "management team" refer to our officers and directors, and references to the "Sponsor" refer to Alpha Partners Technology Merger Sponsor LLC. The following discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with the unaudited condensed financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Special Note Regarding Forward-Looking Statements

This Quarterly Report includes "forward-looking statements" that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements in this "Management's Discussion and Analysis of Financial Condition and Results of Operations" regarding the Company's financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as "expect," "believe," "anticipate," "intend," "estimate," "seek" and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management's current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company's final prospectus for its Initial Public Offering (as defined below) filed with the U.S. Securities and Exchange Commission (the "SEC"). The Company's securities filings can be accessed on the EDGAR section of the SEC's website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Overview

We are a blank check company incorporated on February 5, 2021 as a Cayman Island exempted company and formed for the purpose of effectuating a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this Quarterly Report as our "initial business combination". We intend to effectuate our initial business combination using cash from the proceeds of the initial public offering (the "Initial Public Offering") and the private placement of the Private Placement Units (as defined below), the proceeds of the sale of our shares in connection with our initial business combination (pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of the Initial Public Offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, or a combination of the foregoing.

On July 30, 2021, we consummated our IPO of 25,000,000 Units, at $10.00 per Unit, generating gross proceeds of $250.0 million, and incurring offering costs of approximately $13.75 million, of which $8.75 million was for deferred underwriting commissions. We granted the underwriter a 45-day option to purchase up to an additional 3,750,000 Units at the IPO price to cover over-allotments, if any. On August 3, 2021, the underwriters partially exercised the over-allotment option, and the closing of the issuance and sale of the additional 3,250,000 Over-Allotment Units occurred on August 5, 2021. The issuance by the Company of the Over-Allotment Units at a price of $10.00 per unit resulted in total gross proceeds of approximately $32.5 million.


                                       22

--------------------------------------------------------------------------------

Table of Contents

Simultaneously with the closing of the IPO, we consummated the Private Placement of 800,000 units, at a price of $10.00 per Private Placement Unit with the Sponsor, generating gross proceeds of $8.0 million. Simultaneously with the issuance and sale of the Over-Allotment Units, the Company consummated the private placement with the Sponsor of 65,000 Additional Private Placement Units, generating total proceeds of $650,000.



Upon the closing of the IPO and the Private Placement, approximately
$250.0 million ($10.00 per Unit) of the net proceeds of the IPO and certain of
the proceeds of the Private Placement were placed in a Trust Account, located in
the United States with Continental Stock Transfer & Trust Company acting as
trustee, and will be invested only in United States "government securities"
within the meaning of Section 2(a)(16) of the Investment Company Act, having a
maturity of 185 days or less or in money market funds meeting certain conditions
under Rule
2a-7
promulgated under the Investment Company Act which invests only in direct U.S.
government treasury obligations, as determined by us, until the earlier of:
(i) the completion of a Business Combination and (ii) the distribution of the
Trust Account as described below. In addition, a certain anchor investor
advanced an aggregate amount of approximately $500,681 to the Company to cover
the purchase of Private Placement Units. In April 2021, the Company repaid $681
to the anchor investor. Upon the closing of the IPO, the remaining advance of
$500,000 was applied to the purchase of the Private Placement Units which the
Company has since repaid.

Our management has broad discretion with respect to the specific application of the net proceeds of the IPO and the sale of Private Placement Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that we will be able to complete a Business Combination successfully.

We must complete one or more initial Business Combinations having an aggregate fair market value of at least 80% of the net assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the Trust Account) at the time of the signing of the agreement to enter into the initial Business Combination. However, we will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the prospective partner company or otherwise acquires a controlling interest in the prospective party company sufficient for it not to be required to register as an investment company under the Investment Company Act.



If we are unable to complete a 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 our income taxes, if any (less up to
$100,000 of interest to pay dissolution expenses) divided by the number of the
then-outstanding Public Shares, which redemption will completely extinguish
public shareholders' rights as shareholders (including the right to receive
further liquidation distributions, if any); and (iii) as promptly as reasonably
possible following such redemption, subject to the approval of the remaining
shareholders and the board of directors, liquidate and dissolve, subject in the
case of clauses (ii) and (iii), to our obligations under Cayman Islands law to
provide for claims of creditors and the requirements of other applicable law.
There will be no redemption rights or liquidating distributions with respect to
our warrants, which will expire worthless if we fail to consummate a Business
Combination within the Combination Period.

As of June 30, 2022 and December 31, 2021, we held cash of $1,392,907 and $2,124,185, respectively, current liabilities of $520,716 and $193,254, respectively, and deferred underwriting compensation of $9,887,500. Further, we expect to continue to incur significant costs in the pursuit of our initial business combination. We cannot assure you that our plans to complete an initial business combination will be successful.


                                       23

--------------------------------------------------------------------------------

Table of Contents

Results of Operations



We have neither engaged in any operations nor generated any operating revenues
to date. Our only activities for the six months ended June 30, 2022 and for the
period from February 5, 2021 (inception) through June 30, 2021 were
organizational activities, those necessary to prepare for the Initial Public
Offering, described below, and, after our Initial Public Offering, identifying a
target company for a business combination.. We do not expect to generate any
operating revenues until after the completion of our initial business
combination. We will generate
non-operating
income in the form of interest and dividend income on cash and investments held
after the Initial Public Offering. We incur expenses as a result of being a
public company (for legal, financial reporting, accounting and auditing
compliance), as well as for due diligence expenses.

For the three months ended June 30, 2022, we recorded net income of $3,008,615, which resulted from a gain on fair value of warrant liability of $3,203,124 and interest and dividend income on investments held in the Trust Account in the amount of $381,481, partially offset by operating and formation costs of $575,990.

For the three months ended June 30, 2021, we recorded net income of $215,625, which resulted fully from a gain on fair value of the warrant liability.

For the six months ended June 30, 2022, we recorded net income of $6,226,664, which resulted from a gain on fair value of warrant liability of $7,017,383 and interest and dividend income on investments held in the Trust Account in the amount of $409,811, partially offset by operating and formation costs of $1,200,530.

For the period from February 5, 2021 (inception) through June 30, 2021, we had a net loss of $2,039,889, which resulted from a loss on the sale of warrants of $1,213,542, a loss on the fair value of warrant liabilities of $814,583, and formation and operating costs of $11,764.

Liquidity and Capital Resources

For the six months ended June 30, 2022, net cash used in operating activities was $731,278, which was due to the change in fair value of the warrant liability of $7,017,383 and interest and dividend income on the investments held in the Trust Account of $409,811, partially offset by net income of $6,226,664 and changes in working capital of $469,252.

For the period from February 5, 2021 (inception) through June 30, 2021 net cash used in operating activities was $0 which resulted from a loss on the sale of warrants of $1,213,542, a loss on the fair value of warrant liabilities of $814,583, and the payment of formation costs through issuance of Class B ordinary shares of $11,764, fully offset by net loss of $2,039,889.

For the period from February 5, 2021 (inception) through June 30, 2021, net cash provided by financing activities was $500,000 which was resulted from an advance from an anchor investor of $500,681, offset in part by repayment of the advance from an anchor investor of $681.

As of June 30, 2022 and December 31, 2021, we had cash of $1,392,907 and $2,124,185 held outside the Trust Account. We will use these funds to primarily identify and evaluate prospective partner businesses, perform business due diligence on prospective partner businesses, travel to and from the offices, plants or similar locations of prospective partner businesses or their representatives or owners, review corporate documents and material agreements of prospective partner businesses, and structure, negotiate and complete a business combination.

We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account (less taxes payable and deferred underwriting commissions), to complete our initial business combination. We may withdraw interest income (if any) to pay income taxes, if any. Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the Trust Account. We expect the interest income earned on the amount in the Trust Account (if any) will be sufficient to pay our income taxes. To the extent that our equity or debt is used, in whole or in part, as consideration to complete our initial business combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the prospective partner, make other acquisitions and pursue our growth strategies.


                                       24

--------------------------------------------------------------------------------

Table of Contents

In order to fund working capital deficiencies or finance transaction costs in connection with an intended 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 may 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 $1,500,000 of such loans may be convertible into units of the post-business combination company at a price of $10.00 per unit at the option of the lender. The units would be identical to the Private Placement Units. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Prior to the completion of our initial business combination, we do not expect to seek loans from parties other than our Sponsor, members of our management team or any of their affiliates as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our Trust Account.

We have incurred and expect to continue to incur significant costs in pursuit of our initial business combination. As such, we may have insufficient funds available to operate our business through one year from the date that these unaudited condensed financial statements are filed, if we do not complete a business combination prior to such date. 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 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. In addition, we intend to target businesses larger than we could acquire with the net proceeds of our IPO and the sale of the private placement warrants and may as a result be required to seek additional financing to complete such proposed initial business combination. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the Trust Account. In addition, following our business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.



Off-Balance
Sheet Arrangements

We did not have any
off-balance
sheet arrangements as of June 30, 2022 or December 31, 2021.

Contractual Obligations

Underwriting Agreement



We granted the underwriters a
45-day
option to purchase up to 3,750,000 additional Units to cover over-allotments at
the IPO price, less the underwriting discounts and commissions. On August 5,
2021, the underwriters partially exercised the over-allotment option to purchase
an additional 3,250,000 Units at an offering price of $10.00 per Unit for an
aggregate purchase price of $32,500,000. On September 11, 2021, the remaining
option expired.

The underwriters were paid a cash underwriting discount of $0.20 per Unit, or $5,650,000 in the aggregate, upon the closing of the IPO and partial exercise of the over-allotment option. In addition, $0.35 per unit, or $9,887,500 in the aggregate will be payable to the underwriters for deferred underwriting commissions. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that we complete a Business Combination, subject to the terms of the underwriting agreement.


                                       25

--------------------------------------------------------------------------------

Table of Contents

Critical Accounting Policies

The preparation of condensed financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America 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 unaudited condensed financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following critical accounting policies:

Net Income (Loss) Per Ordinary Share

Net income (loss) per ordinary share is computed by dividing net income (loss) by the weighted-average number of ordinary shares outstanding during the period. Accretion associated with the redeemable Class A ordinary shares is excluded from net income (loss) per share as the redemption value approximates fair value. Therefore, the income (loss) per share calculation allocates income (losses) shared pro rata between Class A and Class B ordinary shares. As a result, the calculated net income (loss) per share is the same for Class A and Class B ordinary shares. We have not considered the effect of the warrants sold in the IPO, Private Placement, and warrants included in the founder units issued to our Sponsor to purchase an aggregate of 12,059,166 shares in the calculation of diluted income (loss) per share, since the exercise of the warrants is contingent upon the occurrence of future events.

Class A Ordinary Shares Subject to Possible Redemption



All of the 28,250,000 Class A ordinary shares sold as part of the units in the
IPO contain a redemption feature which allows for the redemption of such Public
Shares in connection with the our liquidation, if there is a shareholder vote or
tender offer in connection with the Business Combination and in connection with
certain amendments to the Company's amended and restated memorandum and articles
of association. In accordance with SEC and its staff's guidance on redeemable
equity instruments, which has been codified in Accounting Standards Codification
("ASC") 480,
Distinguishing Liabilities from Equity
("ASC 480"), redemption provisions not solely within our control require
ordinary shares subject to redemption to be classified outside of permanent
equity. Therefore, all Public Shares have been classified outside of permanent
equity.

We recognize changes in redemption value immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable ordinary shares are affected by charges against additional paid in capital and accumulated deficit.

Warrant Liabilities

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 ASC 480 and ASC Topic 815, Derivatives and Hedging ("ASC 815"). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company's own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.



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. For issued or modified warrants that do not
meet all the criteria for equity classification, the warrants are required to be
recorded at their initial fair value on the date of issuance, and each balance
sheet date thereafter. Changes in the estimated fair value of the warrants are
recognized as a
non-cash
gain or loss on the condensed statements of operations. The initial fair value
of the Public Warrants was estimated using a binomial/lattice model and the fair
value of the Founder Warrants and Private Placement Warrants was estimated using
a Black-Scholes Option Pricing Model.

                                       26

--------------------------------------------------------------------------------

Table of Contents

Recent Accounting Standards

Our management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying unaudited condensed financial statements.

© Edgar Online, source Glimpses