References to the "Company," "Logistics Innovation Technologies Corp.," "our,"
"us" or "we" refer to Logistics Innovation Technologies Corp. The following
discussion and analysis of the Company's financial condition and results of
operations should be read in conjunction with the unaudited interim condensed
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.
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, 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
We are a blank check company incorporated on February 18, 2021 as a Delaware
corporation for the purpose of effecting a merger, capital stock exchange, asset
acquisition, stock purchase, reorganization or similar business combination with
one or more businesses. We are an emerging growth company and, as such, we are
subject to all of the risks associated with emerging growth companies.
Our Sponsors are AG LIT Holdings, LLC, a Delaware limited liability company, and
1P Management LLC, a Delaware limited liability company. The registration
statement for our IPO was declared effective on June 10, 2021. On June 15, 2021,
we consummated the IPO of 34,089,611 Units, including the issuance of 4,089,611
Units as a result of the underwriters' exercise in part of their option to
purchase additional Units, at $10.00 per Unit, generating gross proceeds of
$340,896,110, and incurring offering costs of approximately $18.9 million,
inclusive of approximately $11.9 million in deferred underwriting commissions.
Simultaneously with the closing of the IPO, we consummated the Private Placement
of 5,945,281 Private Placement Warrants at a price of $1.50 per Private
Placement Warrants to the Sponsor, generating gross proceeds of $8,917,922.
Upon the closing of the IPO and the Private Placement in June 2021, $340,896,110
($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 at JP Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust
Company acting as trustee, and was invested only in U.S. "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 invest 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.
Our management has broad discretion with respect to the specific application of
the net proceeds of the IPO and the sale of Private Placement Warrants, although
substantially all of the net proceeds are intended to be applied generally
toward consummating a Business Combination.
If we are unable to complete a Business Combination within 24 months from the
closing of the IPO, or June 15, 2023, 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 its taxes (less up to $100,000 of
interest to pay dissolution expenses), divided by the number of then outstanding
Public Shares, which redemption will completely extinguish Public Stockholders'
rights as stockholders (including the right to receive further liquidating
distributions, if any), and (iii) as promptly as reasonably possible following
such redemption, subject to the approval of the remaining stockholders and the
board of directors, liquidate and dissolve, subject, in each case, to our
obligations under Delaware law to provide for claims of creditors and the
requirements of other applicable law.
Liquidity and Capital Resources
As of March 31, 2021, the Company had no cash and a working capital deficiency
of $10,000 (excluding deferred offering costs). Until the consummation of the
IPO, the Company's only source of liquidity was an initial purchase of common
stock by our Sponsor.
Subsequent to the period covered by this Quarterly Report, the Company
consummated its IPO and Private Placement, and the underwriters partially
exercised their Over-Allotment Option. Of the net proceeds from the IPO, partial
exercise of the Over-Allotment Option, and associated Private Placements,
$340,896,110 of cash was placed in the Trust Account and $2,427,771 of cash was
held outside of the Trust Account and is available for the Company's working
The Company's initial stockholders, officers, directors or their affiliates may,
but are not obligated to, loan the Company Working Capital Loans. If the Company
completes a Business Combination, the Company may repay the Working Capital
Loans out of the proceeds of the Trust Account released to the Company.
Otherwise, the Working Capital Loans may be repaid only out of funds held
outside the Trust Account. In the event that a Business Combination does not
close, the Company 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, other than the interest on
such proceeds that may be released for working capital purposes. Except for the
foregoing, the terms of such Working Capital Loans, if any, have not been
determined and no written agreements exist with respect to such 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 $1,500,000
of such Working Capital Loans may be convertible into Private Placement Warrants
of the post Business Combination entity at a price of $1.50 per warrant. As of
March 31, 2021, no Working Capital Loans were outstanding.
Based on the foregoing, management believes that the Company will have
sufficient working capital to meet its needs through the earlier of the
consummation of a Business Combination or one year from this filing. Over this
time period, the Company 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.
Our management continues 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 unaudited condensed financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
Results of Operations
Our entire activity since inception up to March 31, 2021 was in preparation for
our formation and the preparation for our IPO. We will not be generating any
operating revenues until the closing and completion of our initial Business
For the period from February 18, 2021 (inception) through March 31, 2021, we had
net loss of $509, which consisted of formation costs.
The holders of Founder Shares, Private Placement Warrants and warrants that may
be issued upon conversion of Working Capital Loans, if any, (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) are entitled to registration
rights pursuant to a registration rights agreement. These holders will be
entitled to certain demand and "piggyback" registration rights. We will bear the
expenses incurred in connection with the filing of any such registration
We granted the underwriters a 45-day option from the final prospectus relating
to the IPO to purchase up to 4,500,000 additional Units to cover
over-allotments, if any, at the IPO price less the underwriting discounts and
commissions. The underwriters partially exercised their over-allotment option on
June 15, 2021 with the purchase of 4,089,611 units.
The underwriters were paid a cash underwriting discount of $0.20 per Public
Share, or $6.8 million in the aggregate. Additionally, the underwriters
reimbursed us $500,000 for offering costs. In addition, $0.35 per Public Share,
or approximately $11.9 million 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
Critical Accounting Policies
Deferred Offering Costs Associated with the IPO
We comply with the requirements of the ASC 340-10-S99-1 and SEC Staff Accounting
Bulletin ("SAB") Topic 5A-"Expenses of Offering". Offering costs consist
principally of professional and registration fees incurred through the balance
sheet date that are related to the IPO. Offering costs are charged against the
carrying value of Class A shares or the statement of operations based on the
relative value of the Class A Shares and the Public Warrants to the proceeds
received from the Units sold upon the completion of the IPO. Accordingly, on
June 15, 2021, offering costs totaling $18,860,728 were recognized, $561,610 of
which was allocated to the Public Warrants and immediately expensed, and
$18,299,118 were allocated to Class A shares reducing the initial carrying
amount of such shares.
Net Loss Per Ordinary Share
We comply with accounting and disclosure requirements of FASB ASC Topic 260,
"Earnings Per Share." Net loss per share is computed by dividing net loss by the
weighted average number of ordinary shares outstanding during the period,
excluding common stock subject to forfeiture. Weighted average shares at March
31, 2021 were reduced for the effect of an aggregate of 1,125,000 shares of
common stock that are subject to forfeiture if the over-allotment option is not
exercised in full or in part by the underwriters. At March 31, 2021, we did not
have any dilutive securities and other contracts that could, potentially, be
exercised or converted into ordinary shares and then share in the earnings of
our Company. As a result, diluted loss per share is the same as basic loss per
share for the period presented.
Recent Accounting Pronouncements
Our management does not believe that there are any other recently issued, but
not yet effective, accounting pronouncements, if currently adopted, that would
have a material effect on our unaudited condensed financial statements.
Off-Balance Sheet Arrangements
As of March 31, 2021, we did not have any off-balance sheet arrangements as
defined in Item 303(a)(4)(ii) of Regulation S-K.
The Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") contains
provisions that, among other things, relax certain reporting requirements for
qualifying public companies. We qualify as an "emerging growth company" and
under the JOBS Act are 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, the financial statements may not
be comparable to companies that comply with new or revised accounting
pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the
other reduced reporting requirements provided by the JOBS Act. 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 IPO or until we are no longer an "emerging
growth company," whichever is earlier.
© Edgar Online, source Glimpses