MEDH ACQU References in this report (the "Quarterly Report") to "we," "us" or the
"Company" are to
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 Merger
? (as defined below) and other transactions contemplated by the Business
Combination Agreement (as defined herein);
? our expectations around the performance of the prospective target business or
businesses, including Memic (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 Annual Report on Form 10-K, as amended, filed with the
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Overview
We are a blank check company formed under the laws of the
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
Pursuant to the Business Combination Agreement, subject to the terms and
conditions set forth therein, upon the closing of the transactions contemplated
thereby, Merger Sub will merge with and into us, with us surviving as a
wholly-owned subsidiary of Memic (the "Merger"). The Merger contemplates an
implied enterprise valuation of Memic of
Pursuant to the Business Combination Agreement at the time the Merger becomes effective (the "Effective Time"), among other things:
the shares of our Class A common stock, par value
Class A Stock") and the Public Warrants, which, immediately prior to the
? Effective Time, will be automatically separated, if not already separated prior
to such time, and the holder thereof will be deemed to hold one share of SPAC
Class A Stock and one-third of one Public Warrant;
each share of our Class B common stock, par value of
Stock") and SPAC Class A Stock issued and outstanding immediately prior to the
? Effective Time (after giving effect to any redemptions by our public
stockholders) will be converted into and will for all purposes represent only
the right to receive one ordinary share,
("Memic Ordinary Shares");
each Public Warrant and each Private Placement Warrants to purchase one share
? of SPAC Class A Stock issued to our Sponsor that is outstanding unexercised
immediately prior to the Effective Time will be converted into and become a
warrant to purchase one Memic Ordinary Share; and
each pre-closing shareholder of Memic will receive price adjustment rights
entitling such holders to receive additional Memic Ordinary Shares upon the
achievement of certain milestones related to Memic's post-closing trading
price; the maximum number of Memic Ordinary Shares issuable pursuant to such
price adjustment rights equals seventeen percent (17%) of the sum of (i) the
? number of outstanding Memic Ordinary Shares as calculated immediately after the
closing of the Merger, (ii) the number of Memic Ordinary Shares issuable upon
exercise of outstanding options that are vested and exercisable as of the
Merger, and (iii) the number of Memic Ordinary Shares issuable upon exercise of
Memic's warrants that were issued and outstanding immediately prior the Merger,
as ultimately determined after the consummation of the Merger).
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Concurrently with the execution and delivery of the Business Combination
Agreement, in support of the Merger, our Sponsor, and each of our officers and
each of the members of our board of directors (each an "Insider" and
collectively, the "Insiders" and, together with our Sponsor, the "
Concurrently with the execution and delivery of the Business Combination
Agreement, certain Memic shareholders (each, a "Voting Party" and together, the
"Voting Parties") entered into voting agreements (the "Voting Agreements") with
us. Under the Voting Agreements, each
Concurrently with the execution and delivery of the Business Combination
Agreement, in support of the Business Combination, our Sponsor, and certain
shareholders of Memic (collectively, with our Sponsor, the "Shareholder
Parties") entered into and delivered a Confidentiality and Lock-Up Agreement
(the "Lock-Up Agreement"), pursuant to which the Shareholder Parties have agreed
not to transfer any Memic Ordinary Shares held by them until the one year
anniversary of the Effective Time, subject to early release if the stock price
of the Memic Ordinary Shares is greater than or equal to
As a condition to closing the Business Combination Agreement, Memic, our Sponsor
and certain Memic equity holders (collectively with the our Sponsor, the "Memic
Holders") will enter into a Registration Rights Agreement (the "Registration
Rights Agreement") that will become effective concurrently with the Merger,
pursuant to which Memic agreed to file a shelf registration statement, by no
later than ninety (90) business days after the closing date to register the
resale of the Memic Ordinary Shares and warrants to purchase Memic Ordinary
shares . The Registration Rights Agreement also provides the Memic Holders with
(i) piggyback registration rights and (ii) three demand rights in any
twelve-month period for an underwritten shelf takedown, provided that the
demanding holders propose to sell securities with a total offering price
reasonably expected to exceed, in the aggregate,
Concurrently with the execution and delivery of the Business Combination
Agreement, Memic entered into subscription agreements (the "Subscription
Agreements") with certain investors (the "
The Business Combination Agreement and related agreements are further described
in our Current Report on Form 8-K filed with the
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Results of Operations
We have neither engaged in any operations nor generated any revenues to date.
Our only activities from
For the three months ended
For the nine months ended
For the period from
Liquidity and Capital Resources
On
Following the Initial Public Offering, the partial exercise of the
over-allotment option, and the sale of the Private Placement Units, a total of
For the nine months ended
For the period from
As of
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 income taxes payable), to complete our Business Combination. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete our 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.
As of
In order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, the Sponsor, or certain of our officers and directors or their affiliates may, but are not obligated to, loan us funds as may be required. If we complete a Business Combination, we would repay such loaned amounts. 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
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would be used for such repayment. Up to
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.
Off-Balance Sheet Arrangements
We have no obligations, assets or liabilities, which would be considered
off-balance sheet arrangements as of
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 total of
The underwriters are entitled to a deferred fee of
Critical Accounting Policies
The preparation of condensed financial statements and related disclosures in
conformity with accounting principles generally accepted in
Warrant Liabilities
The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and FASB ASC Topic 815, "Derivatives and Hedging" ("ASC 815"). The Company accounts for the Public Warrants and Private Placement Warrants (together with the Public Warrants, the "Warrants") in accordance with the guidance contained in ASC 815-40 under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjust the Warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the statement of operations. The Private Placement Warrants for periods where no observable traded price was available are valued using a Monte Carlo Simulation Model. The Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrant quoted market price was used as the fair value as of each relevant date.
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Class A Common Stock Subject to Possible Redemption
We account for our Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities from Equity." Shares of 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 feature 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 is classified as stockholders' equity. Our Class A common stock features certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, shares of Class A common stock subject to possible redemption are presented as temporary equity, outside of the stockholders' equity (deficit) section of our balance sheets.
Net Income Per Common Share
Net income (loss) per common stock is computed by dividing net income (loss) by the weighted average number of common stock outstanding for the period. The Company has two classes of common stock, which are referred to as Class A common stock and Class B common stock. Income and losses are shared pro rata between the two classes of common stock. Accretion associated with the redeemable shares of Class A common stock is excluded from earnings per share as the redemption value approximates fair value.
Recent Accounting Standards
In
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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