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 (the
"Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as
amended (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. Such statements include, but are not limited
to, possible business combinations and the financing thereof, and related
matters, as well as all other statements other than statements of historical
fact included in this Form 10-K. Factors that might cause or contribute to such
a discrepancy include, but are not limited to, those described in our other
Overview
Our sponsor is an affiliate of Thoma Bravo, a software-focused private equity
investment firm, with approximately
Our objective is to identify and work with an existing management team to operate a market-leading, fast-growing software franchise with high-quality and recurring revenue streams in a fragmented market, and that offers attractive organic and inorganic growth opportunities. Through our many successful software investments, we have accumulated a robust set of operating best practices through which we can provide a business with the opportunity to accelerate its growth and create significant value in a short time frame. We believe our company is well-positioned to extend our experience and operating practices to a potential business partner that is at an appropriate stage of corporate development to operate as a public company.
Proposed Initial Business Combination
On
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the First Merger, the "Mergers"), with Merger Sub II surviving the Second Merger
as a wholly owned subsidiary of ironSource. The transactions set forth in the
Merger Agreement, including the Mergers, will constitute a "Business
Combination" as contemplated by our amended and restated memorandum and articles
of association and are further described in Note 1 to the financial statements
included in Item 1 of this Quarterly Report on Form 10-Q, our Annual Report on
From 10-K filed with the
The Merger Agreement and the transactions contemplated thereby have been unanimously approved by our board and the board of directors of ironSource and is expected to close in the second quarter of 2021.
Results of Operations
Our entire activity from
For the three months ended
Liquidity and Going Concern
As of
Our liquidity needs up to
Based on the foregoing, our management believes that we will have sufficient working capital and borrowing capacity from our Sponsor or an affiliate of our Sponsor, or certain of 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.
Related Party Transactions Founder Shares
On
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The Initial Shareholders agreed, subject to limited exceptions, not to transfer,
assign or sell any of their Founder Shares until the earlier to occur of:
(A) one year after the completion of the initial Business Combination and
(B) subsequent to the initial Business Combination, (x) if the last reported
sale price of Class A ordinary shares equals or exceeds
Private Placement Shares
Simultaneously with the closing of the Initial Public Offering, we consummated
the Private Placement of 2,400,000 Private Placement Shares, at a price of
Our Sponsor agreed, subject to limited exceptions, not to transfer, assign or sell any of its Private Placement Shares until 30 days after the completion of the initial Business Combination.
Sponsor Loan
On
Working Capital Loans
In addition, in order to 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 ("Working Capital Loans"). If we complete a Business Combination, we
will repay the Working Capital Loans. In the event that a Business Combination
does not close, we may use a portion of proceeds held outside the Trust Account
to repay the Working Capital Loans, but no proceeds held in the Trust Account
would be used to repay the Working Capital Loans. The Working Capital Loans
would either be repaid upon consummation of a Business Combination, without
interest, or, at the lender's discretion, up to
Termination of Administrative Support Agreement
At the time of the initial public offering, we agreed to pay our sponsor
In addition, our sponsor, executive officers and directors, or any of their
respective affiliates will be reimbursed for any out-of-pocket expenses
incurred in connection with activities on our behalf such as identifying
potential target businesses and performing due diligence on suitable Business
Combinations. Our audit committee will review on a quarterly basis all payments
that were made by us to our sponsor, executive officers or directors, or their
affiliates. Any such payments prior to an initial Business Combination will be
made using funds held outside the Trust Account. As of
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Other Contractual Obligations
Registration Rights
The holders of Founder Shares, Private Placement Shares, and Class A ordinary shares that may be issued upon conversion of Working Capital Loans were entitled to registration rights pursuant to a registration rights agreement signed upon consummation of the Initial Public Offering. These holders were entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, these holders will have certain "piggy-back" registration rights with respect to registration statements filed subsequent to the completion of the initial Business Combination. We will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
We granted the underwriters a 45-day option from the final prospectus relating
to the Initial Public Offering to purchase up to 10,000,000 additional Class A
ordinary shares to cover over-allotments, if any, at the Initial Public Offering
price less the underwriting discounts and commissions. The underwriters fully
exercised the over-allotment option on
The underwriters were entitled to an underwriting discount of
Risks and Uncertainties
Our management continues to evaluate the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on our financial position, results of operations and/or search for a target company, the specific impact is not readily determinable as of the date of these unaudited condensed financial statements. The unaudited condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Critical Accounting Policies and Estimates
This management's discussion and analysis of our financial condition and results
of operations is based on our unaudited condensed financial statements, which
have been prepared in accordance with
Investments held in the Trust Account
Our portfolio of investments held in the Trust Account is comprised of
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investments held in the Trust Account are classified as trading securities. Trading securities are presented on the balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of these securities is included in net gain on investments held in Trust Account in the accompanying unaudited condensed statement of operations. The estimated fair values of investments held in the Trust Account are determined using available market information.
Class A ordinary shares subject to possible redemption
We account for our Class A ordinary shares subject to possible redemption in
accordance with the guidance in 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
Net loss per ordinary share
We comply with accounting and disclosure requirements of FASB ASC Topic 260,
"Earnings Per Share." Net loss per ordinary share is computed by dividing net
loss by the weighted average number of ordinary shares outstanding during the
period excluding ordinary shares subject to forfeiture. As of
Our unaudited condensed statement of operations includes a presentation of
income per share for ordinary shares subject to redemption in a manner similar
to the two-class method of income per share. Net loss per share, basic and
diluted for Class A redeemable ordinary shares is calculated by dividing the
interest income earned on the Trust Account of approximately
Recent Accounting Pronouncements
Our management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on our unaudited condensed financial statements.
Off-Balance Sheet Arrangements
As of
JOBS Act
On
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As an "emerging growth company", we are not 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-emerginggrowth 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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