References to the "Company," "our," "us" "we" refer to Turmeric Acquisition
Corp. 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 report. Certain
information contained in the discussion and analysis set forth below includes
forward-looking statements that involve risks and uncertainties.
Overview
We are a blank check company incorporated as a Cayman Islands exempted company
on August 28, 2020 for the purpose of effecting a merger, share exchange, asset
acquisition, share purchase, reorganization or similar business combination with
one or more businesses (the "Business Combination"). Our Sponsor is Turmeric
Management, LLC, a Delaware limited liability company ("Sponsor").
The registration statement for our initial public offering (the "Initial Public
Offering') became effective on October 15, 2020. On October 20, 2020, we
consummated the Initial Public Offering of 9,775,000 units (the "Units" and,
with respect to the Class A ordinary shares included in the Units being offered,
the "Public Shares"), including 1,275,000 additional Units to cover
over-allotments (the "Over-Allotment Units"), at $10.00 per Unit, generating
gross proceeds of approximately $97.8 million, and incurring offering costs of
approximately $5.9 million, inclusive of approximately $3.4 million in deferred
underwriting commissions.
Simultaneously with the closing of the Initial Public Offering, we consummated
the private placement ("Private Placement") of 415,500 units (each, a "Private
Placement Unit" and collectively, the "Private Placement Units"), at a price of
$10.00 per Private Placement Unit with the Sponsor, generating gross proceeds of
approximately $4.2 million.
Upon the closing of the Initial Public Offering and the Private Placement,
approximately $97.8 million ($10.00 per Unit) of the net proceeds of the Initial
Public Offering and certain of the proceeds of the Private Placement were placed
in a trust account ("Trust Account"), located in the United States with
Continental Stock Transfer & Trust Company acting as trustee, and invested only
in money market funds meeting certain conditions under Rule 2a-7 promulgated
under the Investment Company Act which invest only in direct U.S. government
treasury obligations, until the earlier of: (i) the completion of a Business
Combination and (ii) the distribution of the Trust Account as described below.
If we have not completed a Business Combination within 24 months from the
closing of the Initial Public Offering, or October 20, 2022 (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
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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
outstanding warrants, which will expire worthless if we fail to consummate a
Business Combination within the Combination Period.
Results of Operations
Our entire activity since inception through December 31, 2020 related to our
formation, the preparation for the Initial Public Offering, and since the
closing of the Initial Public Offering, the search for a prospective initial
Business Combination. We have neither engaged in any operations nor generated
any revenues to date. We will not generate any operating revenues until after
completion of our initial Business Combination. We will generate non-operating
income in the form of interest income on cash and cash equivalents. We expect to
incur increased 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 period from August 28, 2020 (inception) through December 31, 2020, we
had a net loss of approximately $336,000, which consisted of approximately
$307,000 in general and administrative expenses and $30,000 administrative fees
to a related party, partially offset by a net gain on investments in Trust
Account of approximately $800.
Liquidity and Capital Resources
As of December 31, 2020, we had approximately $1.2 million in our operating bank
account and working capital of approximately $1.4 million.
To date, our liquidity needs have been satisfied through a payment of $25,000
from our Sponsor to cover certain expenses on our behalf in exchange for the
issuance of the Founder Shares to our Sponsor, a loan of approximately $89,000
pursuant to a promissory note issued to our Sponsor and the net proceeds from
the consummation of the Private Placement not held in the Trust Account. We
repaid the promissory note on October 20, 2020.
In addition, in order to finance transaction costs in connection with a Business
Combination, our officers, directors and Initial Shareholders may, but are not
obligated to, provide us Working Capital Loans. To date, there were no amounts
outstanding under any Working Capital Loans.
Based on the foregoing, management believes that we will have sufficient working
capital and borrowing capacity from our Sponsor or an affiliate of our Sponsor,
or our officers and directors to meet our needs through the earlier of the
consummation of a Business Combination or one year from this 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.
We continue to evaluate the impact of the COVID-19 pandemic and has concluded
that the specific impact is not readily determinable as of the date of the
balance sheet. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty.
Contractual Obligations
We do not have any long-term debt obligations, capital lease obligations,
operating lease obligations, purchase obligations or long-term liabilities,
other than an administrative services agreement to pay our Sponsor $10,000 per
month for office space, secretarial and administrative services provided to us.
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Critical Accounting Policies
This management's discussion and analysis of our financial condition and results
of operations is based on our financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States of
America. The preparation of our financial statements requires us to make
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues 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 historical experience, 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:
Class A Ordinary Shares Subject to Possible Redemption
We account for Class A ordinary shares subject to possible redemption in
accordance with the guidance in Financial Accounting Standards Board ("FASB")
Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities
from Equity." Class A ordinary shares subject to mandatory redemption (if any)
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. Accordingly, as of December 31, 2020, a total of 9,067,273 Class A
ordinary shares subject to possible redemption are presented as temporary
equity, outside of the shareholders' equity section of the balance sheet.
Net Loss Per Ordinary Share
Net income (loss) per share is computed by dividing net income (loss) by the
weighted-average number of ordinary shares outstanding during the periods. Our
statement of operations includes a presentation of income (loss) per share for
ordinary shares subject to redemption in a manner similar to the two-class
method of income per share. Net income per ordinary share, basic and diluted for
Class A ordinary shares is determined by dividing the income earned on
investments held in the Trust Account of $790 for the period from August 28,
2020 (inception) through December 31, 2020 by the weighted average number of
Class A ordinary shares outstanding for the period. Net loss per ordinary share,
basic and diluted for Class B ordinary shares is determined by dividing the net
loss of approximately $336,000 for the period from August 28, 2020 (inception)
through December 31, 2020, less income attributable to Class A ordinary shares
of $790, by the weighted average number of Class B ordinary shares outstanding
for the period.
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 financial statements.
Off-Balance Sheet Arrangements
As of December 31, 2020, we did not have any off-balance sheet arrangements as
defined in Item 303(a)(4)(ii) of Regulation S-K.
JOBS Act
The JOBS Act contains provisions that, among other things, relax certain
reporting requirements for qualifying public companies. We will qualify as an
"emerging growth company" and under the JOBS Act will be 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, our
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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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 our initial public offering or until we are no
longer an "emerging growth company," whichever is earlier.
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TURMERIC ACQUISITION CORP. 
