References in this report (the "Quarterly Report") to "we," "us" or the
"Company" refer to Healthcare Capital Corp. References to our "management" or
our "management team" refer to our officers and directors, and references to the
"Sponsor" refer to Healthcare Capital Sponsor, LLC. 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 Quarterly Report.
Special Note Regarding Forward-Looking Statements
This Quarterly Report includes "forward-looking statements" within the meaning
of Section 27A of the Securities Act and Section 21E of the Exchange Act 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. Forward-looking statements in this report may
include, for example, statements about:
? our ability to select an appropriate target business or businesses;
? our ability to complete our initial business combination, including the
Transactions (as defined herein);
? our expectations around the performance of the prospective target business or
businesses, including Alpha Tau (as defined herein);
? 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 in the healthcare industry;
? our ability to consummate an initial business combination due to the continued
uncertainty resulting from the COVID-19 pandemic;
? the ability of our officers and directors to generate a number of potential
acquisition opportunities;
? our public securities' liquidity and trading;
? the trust account not being subject to claims of third parties; or
? our financial performance following our Initial Public Offering.
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 filed with the SEC as
well as the Risk Factors section of the proxy statement/ prospectus included in
the registration statement on Form F-4 for the proposed Merger (as defined
below) when it becomes available.. 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 formed under the laws of the State of Delaware on
August 18, 2020, for the purpose of effecting a merger, capital stock exchange,
asset acquisition, stock purchase, reorganization or other similar business
combination with one or more businesses. We will effectuate our Business
Combination using cash from the proceeds of the Initial Public Offering and the
sale of the Private Placement Warrants, our capital stock, debt or a combination
of cash, stock and debt.
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.
Recent Developments
On July 7, 2021, we entered into an Agreement and Plan of Merger (the "Merger
Agreement"), with Alpha Tau Medical Ltd., a company organized under the laws of
the State of Israel ( "Alpha Tau") and Archery Merger Sub Inc., a Delaware
corporation and wholly owned subsidiary of Alpha Tau ("Merger Sub"). Alpha Tau
is a clinical-stage oncology therapeutics company focused on the research,
development and commercialization of the highly potent, yet uniquely conformal,
localized radiation therapy for solid tumors. The proprietary Alpha DaRT
technology is designed to utilize the specific therapeutic properties of alpha
particles while aiming to overcome, and even harness for potential benefit, the
traditional shortcomings of alpha radiation's limited range. Alpha Tau believes
that the Alpha DaRT technology has the potential to be broadly applicable across
multiple targets and tumor types.
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The parties anticipate that the Transactions will be consummated in the fourth
quarter of 2021, after the required approval by the stockholders of the Company
(the "Company Stockholder Approval") and the ordinary and preferred shareholders
of Alpha Tau (the "Alpha Tau Shareholder Approval") and the fulfillment or
waiver of certain other conditions as described below.
Upon the consummation of the Transactions (the "Effective Time"), the existing
shareholders of Alpha Tau will own approximately 59.3% of the outstanding
ordinary shares of Alpha Tau ("Alpha Tau Ordinary Shares") and our stockholders
and the PIPE Investors (as defined below) will own the remaining Alpha Tau
Ordinary Shares.
The following securities issuances will be made by Alpha Tau to our
securityholders at the Effective Time and in each case assume the Share Split
(as defined below) has occurred: (i) each share of our Class A common stock
(including shares issuable upon the conversion of our Class B common stock as
described below) will be exchanged for one Alpha Tau Ordinary Share and (ii)
each outstanding warrant of the Company will be assumed by Alpha Tau and will
become a warrant of Alpha Tau (each, an "Alpha Tau Warrant") (with the number of
Alpha Tau Ordinary Shares underlying the Alpha Tau Warrants and the exercise
price of such Alpha Tau Warrants subject to adjustment in accordance with the
terms of the Merger Agreement).
Immediately prior to the Effective Time, (i) each preferred share of Alpha Tau
will be automatically converted into such number of Alpha Tau Ordinary Shares as
determined in accordance with the existing articles of association of Alpha Tau;
(ii) each Alpha Tau Ordinary Share that is issued and outstanding immediately
prior to the Effective Time will be split into 0.905292 of one Alpha Tau
Ordinary Share (rounded to the nearest whole number) (the "Split Factor"). The
Split Factor was set as of the date of the execution of the Merger Agreement and
is based upon the agreed pre-money equity value of Alpha Tau (rounded to the
nearest whole number) (the "Share Split"); and (iii) outstanding securities
convertible into Alpha Tau Ordinary Shares shall be adjusted to give effect to
the foregoing transactions and remain outstanding. Additionally, concurrently
with the closing of the Merger, Alpha Tau will issue securities pursuant to the
Subscription Agreements, as described in more detail below.
Following the Share Split and immediately prior to the Effective Time, each
share of our Class B common stock will be automatically converted into one share
of our Class A common stock and subsequently exchanged into one Alpha Tau
Ordinary Share, as described above.
Sponsor Support Agreement
Concurrently with the execution of the Merger Agreement, the Sponsor and certain
insiders entered into a letter agreement (the "Sponsor Support Agreement") in
favor of the Company and Alpha Tau, pursuant to which they have agreed to, among
other items, (i) vote all shares of common stock of the Company beneficially
owned by them in favor of the Transactions and each other proposal related to
the Transactions proposed by the Company's board of directors at the meeting of
the Company stockholders relating to the Transactions; (ii) appear at such
stockholder meeting (or otherwise cause such shares to be counter as present
thereat) for the purpose of establishing a quorum; (iii) vote all such shares
against any action that would reasonably be expected to impede, interfere with,
delay, postpone or adversely affect the Merger or any of the other transactions
contemplated by the Merger Agreement or result in a breach of any covenant,
representation or warranty or other obligation or agreement of the Company under
the Merger Agreement or any other agreement entered into in connection with the
Transactions or result in any of the conditions set forth in Article IX of the
Merger Agreement not being fulfilled and against any change in business,
management or the board of directors of the Company (other than as contemplated
by the Transactions); (v) not to redeem or seek to redeem any such shares, in
connection with the Company Stockholder Approval; and (vi) not to transfer,
assign or sell such shares, except to certain permitted transferees, prior to
the consummation of the Transactions.
Additionally, the Sponsor Support Agreement provides that the Sponsor and such
insiders agreed not to transfer any of the Alpha Tau's equity securities owned
by the Sponsor and such insiders, except to certain permitted transferees,
beginning at the Effective Time and continuing until the earlier of (x) one year
following the Closing Date (as defined in the Merger Agreement and (y) following
the date that the last sale price of the Alpha Tau Ordinary Shares equals or
exceeds $12.00 per share (subject to certain adjustments) for any 20 trading
days within any 30 trading day period commencing at least 150 days after the
Closing Date.
The Sponsor Support Agreement also provides that the Sponsor will, immediately
prior to the Effective Time, surrender to HCCC for no consideration 1,031,250
Founder Shares and 1,020,000 Private Placement Warrants owned by the Sponsor
(the "Forfeiture"). Further, in the event that the Aggregate Transaction
Proceeds (as defined in the Merger Agreement) are less than or equal to
$225,000,000, the Sponsor will, immediately prior to the Effective Time,
surrender to HCCC for no consideration 1,718,750 Founder Shares and 1,700,000
private placement warrants (collectively, the "Redemption Equity"). In the event
that the Aggregate Transaction Proceeds exceed $225,000,000 but are less than
$250,000,000, the Sponsor will, immediately prior to the Effective Time,
surrender to HCCC for no consideration such percentage of Redemption Equity that
is equal to 100% minus the quotient of (x) the amount by which the Aggregate
Transaction Proceeds exceed $225,000,000 (not to exceed $25,000,000), divided by
(y) $25,000,000. In the event the Aggregate Transaction Proceeds exceed $250.0
million, no Redemption Equity will be forfeited. Further, an additional
1,375,000 Founder Shares and 1,360,000 Private Placement Warrants (the
"Conditional Equity") are subject to vesting over a three year period following
the Closing Date (the "Earnout Period"). The Conditional Equity shall vest only
if the volume-weighted average price of Alpha Tau's ordinary shares on the
Nasdaq exceeds $14.00 per share (as adjusted for share sub-divisions, share
capitalizations, reorganizations, recapitalizations and the like
recapitalization) for 20 trading days within any 30-trading day period (the
"Earnout Condition"). If the Earnout Condition is not satisfied, the Conditional
Equity shall not vest and the Sponsor shall, immediately as of the expiration of
the Earnout Period, automatically be deemed to irrevocably transfer to Alpha
Tau, surrender and forfeit (and the Sponsor shall take all actions necessary to
effect such transfer, surrender and forfeiture) for no consideration the
Conditional Equity. During the Earnout Period, subject to certain exceptions,
the Sponsor shall not transfer the Conditional Equity.
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Alpha Tau Support Agreement
Concurrently with the execution of the Merger Agreement, Alpha Tau, the Company,
certain Alpha Tau Shareholders entered into an agreement (the "Alpha Tau Support
Agreement") pursuant to which such Alpha Tau Shareholders agreed to, among other
items, (i) vote all beneficially owned shares of Alpha Tau in favor of the
Merger and the other transactions contemplated by the Merger Agreement and each
other proposal on the agenda at a shareholder meeting called by Alpha Tau for
the relating to the Transactions, (ii) appear at such meeting or otherwise cause
such shares to be counted as present thereat for the purpose of establishing a
quorum; (ii) vote or execute a written consent against any Company Alternative
Transaction Proposal (as defined in the Merger Agreement) and any other action
that would reasonably be expected to impede, interfere with, delay, postpone or
adversely affect the Merger or any of the other transactions contemplated by the
Merger Agreement or result in a breach of any covenant, representation or
warranty or other obligation or agreement of Alpha Tau under the Merger
Agreement or any other agreement entered into in connection with; and (iii) not
to transfer, assign or sell such shares, except to certain permitted
transferees, prior to the consummation of the Transactions.
Additionally, pursuant to the Alpha Tau Support Agreement, such Alpha Tau
Shareholders agreed not to transfer any of Alpha Tau's equity securities owned
by owned by such Alpha Tau Shareholders, except to certain permitted
transferees, beginning at the Effective Time and continuing until the earlier of
(x) 180 days following the Closing Date (as defined in the Merger Agreement) and
(y) following the date that the last sale price of the Alpha Tau Ordinary Shares
equals or exceeds $12.00 per share (subject to certain adjustments) for any 20
trading days within any 30 trading day period commencing at least 150 days after
the Closing Date.
PIPE Subscription Agreements
On July 7, 2021, concurrently with the execution of the Merger Agreement, Alpha
Tau entered into subscription agreements (each, a "Subscription Agreement") with
certain investors (the "PIPE Investors") pursuant to which, among other things,
the PIPE Investors have agreed to subscribe for and purchase, and Alpha Tau has
agreed to issue and sell to the PIPE Investors, an aggregate of approximately
9,150,000 Alpha Tau Ordinary Shares (on a post-Share Split basis) for an
aggregate purchase price of up to $91,500,000.00 (the "PIPE Investment")
immediately prior to the Effective Time, on the terms and subject to the
conditions set forth therein. The Subscription Agreement contains customary
representations and warranties of Alpha Tau, on the one hand, and each PIPE
Investor, on the other hand, and customary conditions to closing, including the
consummation of the Merger.
The Merger Agreement and related agreements are further described in our Current
Report on Form 8-K filed on July 8, 2021. Other than as specifically discussed,
this report does not assume the closing of the proposed Transactions.
Results of Operations
We have neither engaged in any operations nor generated any operating revenues
to date. Our only activities from inception through June 30, 2021 were
organizational activities and those related to the Initial Public Offering,
described below and 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 expect to generate non-operating income in
the form of interest income on marketable securities held after the Initial
Public Offering. We expect that we will 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 in connection with searching
for, and completing, a Business Combination.
For the three months ended June 30, 2021, we had a net loss of $2,470,413,
derived primarily from net operating cost of $421,093 and change in fair value
of warrant liability of $2,053,500, offset by interest earned on marketable
securities held in Trust Account of $4,180.
For the six months ended June 30, 2021, we had a net income of $5,111,358,
derived primarily from the change in the fair value of warrant liability of
$7,330,000 and interest earned on marketable securities held in Trust Account of
$7,395, offset by operating cost of $695,108, fair value of the warrant
liability in excess of purchase price paid for Private Placement Warrants of
$680,000, and transaction cost allocated to warrant liability of $850,929.
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Liquidity and Capital Resources
On January 20, 2021, we consummated the Initial Public Offering of 27,500,000
Units, at a price of $10.00 per Unit, which included the partial exercise by the
underwriters of their over-allotment option in the amount of 3,500,000 Units,
generating gross proceeds of $275,000,000. Simultaneously with the closing of
the Initial Public Offering, we consummated the sale of 6,800,000 Private
Placement Warrants to the Sponsor at a price of $1.00 per Private Placement
Warrant generating gross proceeds of $6,800,000.
For the six months ended June 30, 2021, cash used in operating activities was
$478,575. Net income of $5,111,358 was adjusted for the following non-cash items
including the change in fair value of warrant liability of $7,330,000, interest
earned on marketable securities held in the Trust Account of $7,395, the change
in fair value of the warrant liability in excess of purchase price paid for
Private Placement Warrants of $680,000 and transaction cost allocated to warrant
liability of $850,929. Changes in operating assets and liabilities provided
$216,533 of cash for operating activities.
Following the Initial Public Offering, the partial exercise of the
over-allotment option, and the sale of the Private Placement Warrants, a total
of $275,000,000 was placed in the Trust Account. We incurred $15,556,327 in
transaction costs, including $4,800,000 of underwriting fees, $10,325,000 of
deferred underwriting fees and $431,327 of other offering costs.
At June 30, 2021, we had cash and marketable securities held in the Trust
Account of $275,007,395. We intend to use substantially all of the funds held in
the Trust Account, including any amounts representing interest earned on the
Trust Account, which interest shall be net of taxes payable and excluding
deferred underwriting commissions, to complete our business combination. We may
withdraw interest from the Trust Account to pay taxes, if any. To the extent
that our share capital or debt is used, in whole or in part, as consideration to
complete a business combination, the remaining proceeds held in the Trust
Account will be used as working capital to finance the operations of the target
business or businesses, make other acquisitions and pursue our growth
strategies.
At June 30, 2021, we had cash of $1,115,098 held outside of the Trust Account.
We intend to use the funds held outside the Trust Account primarily to identify
and evaluate target businesses, perform business due diligence on prospective
target businesses, travel to and from the offices, plants or similar locations
of prospective target businesses or their representatives or owners, review
corporate documents and material agreements of prospective target businesses,
structure, negotiate and complete a business combination.
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 may
repay such loaned amounts out of the proceeds of the Trust Account released to
us. In the event that a 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 warrants, at a
price of $1.00 per warrant, at the option of the lender. The warrants would be
identical to the Private Placement Warrants.
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 consummation
of our Business Combination, in which case we may issue additional securities or
incur debt in connection with such 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 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.
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Off-Balance Sheet Financing Arrangements
We have no obligations, assets or liabilities, which would be considered
off-balance sheet arrangements as of June 30, 2021. We do not participate in
transactions that create relationships with unconsolidated entities or financial
partnerships, often referred to as variable interest entities, which would have
been established for the purpose of facilitating off-balance sheet arrangements.
We have not entered into any off-balance sheet financing arrangements,
established any special purpose entities, guaranteed any debt or commitments of
other entities, or purchased any non-financial assets.
Contractual Obligations
We do not have any long-term debt, capital lease obligations, operating lease
obligations or long-term liabilities, other than an agreement to pay the Sponsor
a monthly fee of $10,000 for business and administrative support services. We
began incurring these fees from January 14, 2021 and will continue to incur
these fees monthly until the earlier of the completion of the Business
Combination and our liquidation.
The underwriters are entitled to a deferred fee of $0.35 per Unit on the
24,000,000 units sold as part of our Initial Public Offering, or $8,400,000. The
underwriters are also entitled to a deferred fee of $0.55 per unit on the
3,500,000 units sold as part of the underwriters' partial exercise of their
overallotment option, or $1,925,000. The underwriters are entitled to a fee of
$10,325,000 in the aggregate. The deferred fee will become payable to the
underwriters from the amounts held in the Trust Account solely in the event that
the Company completes a Business Combination, subject to the terms of the
underwriting agreement.
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 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.
Class A Common Stock Subject to Possible Redemption
We account for our common stock subject to possible redemption in accordance
with the guidance in Accounting Standards Codification ("ASC") Topic 480,
"Distinguishing Liabilities from Equity." Class A common stock subject to
mandatory redemption is classified as a liability instrument and is measured at
fair value. Conditionally redeemable common stock (including common stock that
features redemption rights that is either within the control of the holder or
subject to redemption upon the occurrence of uncertain events not solely within
our control) is classified as temporary equity. At all other times, common stock
are classified as stockholders' equity. Our Class A common stock feature certain
redemption rights that are considered to be outside of our control and subject
to occurrence of uncertain future events. Accordingly, Class A common stock
subject to possible redemption is presented as temporary equity, outside of the
stockholders' equity section of our balance sheet.
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Warrant Liability
The Company accounts 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 Financial Accounting
Standards Board ("FASB") ASC 480, Distinguishing Liabilities from Equity ASC 480
and ASC 815, Derivatives and Hedging. 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 common stock and whether the
warrant holders could potentially require "net cash settlement" in a
circumstance outside of the Company's control, 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
statements of operations. The fair value of the Public Warrants and Private
Placement Warrants were initially estimated using a Monte Carlo simulation with
subsequent remeasurements of the Public Warrants utilizing the trading stock
price (see Note 8).
Fair Value Measurements
Fair value is defined as the price that would be received for sale of an asset
or paid for transfer of a liability, in an orderly transaction between market
participants at the measurement date. GAAP establishes a three-tier fair value
hierarchy, which prioritizes the inputs used in measuring fair value. The
hierarchy gives the highest priority to unadjusted quoted prices in active
markets for identical assets or liabilities (Level 1 measurements) and the
lowest priority to unobservable inputs (Level 3 measurements). These tiers
include:
? Level 1, defined as observable inputs such as quoted prices (unadjusted)
for identical instruments in active markets;
? Level 2, defined as inputs other than quoted prices in active markets that
are either directly or indirectly observable such as quoted prices for
similar instruments in active markets or quoted prices for identical or
similar instruments in markets that are not active; and
? Level 3, defined as unobservable inputs in which little or no market data
exists, therefore requiring an entity to develop its own assumptions, such
as valuations derived from valuation techniques in which one or more
significant inputs or significant value drivers are unobservable.
In some circumstances, the inputs used to measure fair value might be
categorized within different levels of the fair value hierarchy. In those
instances, the fair value measurement is categorized in its entirety in the fair
value hierarchy based on the lowest level input that is significant to the fair
value measurement.
Derivative Financial Instruments
The Company evaluates its 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". For derivative
financial instruments that are accounted for as liabilities, the derivative
instrument is initially recorded at its fair value on the grant date and is then
re-valued at each reporting date, with changes in the fair value reported in the
statements of operations. The classification of derivative instruments,
including whether such instruments should be recorded as liabilities or as
equity, is evaluated at the end of each reporting period. Derivative 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.
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Net Income (Loss) per Common Share
We apply the two-class method in calculating earnings per share. Net income
(loss) per common share, basic and diluted for Class A common stock subject to
possible redemption is calculated by dividing the interest income earned on the
Trust Account, net of applicable taxes, if any, by the weighted-average number
of shares of Class A common stock subject to possible redemption outstanding for
the period. Net income (loss) per share, basic and diluted for and
non-redeemable common stock is calculated by dividing net loss less income
attributable to Class A common stock subject to possible redemption, by the
weighted-average number of shares of non-redeemable common stock outstanding for
the period presented.
Recent Accounting Pronouncements
In August 2020, the FASB issued ASU No. 2020-06, "Debt-Debt with Conversion and
Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in
Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments
and Contracts in an Entity's Own Equity" ("ASU 2020-06"), which simplifies
accounting for convertible instruments by removing major separation models
required under current GAAP. ASU 2020-06 removes certain settlement conditions
that are required for equity contracts to qualify for the derivative scope
exception and it also simplifies the diluted earnings per share calculation in
certain areas. ASU 2020-06 is effective for fiscal years beginning after
December 15, 2023, including interim periods within those fiscal years, with
early adoption permitted. The Company is currently assessing the impact, if any,
that ASU 2020-06 would have on its financial position, results of operations or
cash flows.
Management does not believe that any other recently issued, but not yet
effective, accounting standards, if currently adopted, would have a material
effect on our condensed financial statements.
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