References in this report (the "Quarterly Report") to "we," "us" or the
"Company" refer to Osiris Acquisition Corp. References to our "management" or
our "management team" refer to our officers and directors, and references to the
"Sponsor" refer to Osiris 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 related notes included in Item
1 of this Quarterly Report and with our Annual Report on Form 10-K for the year
ended December 31, 2021, including our audited consolidated financial statements
and related notes contained therein. Certain information contained in the
discussion and analysis set forth below includes forward-looking statements that
involve risks and uncertainties.
Special Note Regarding Forward-Looking Statements
This Quarterly Report 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 Exchange Act of 1934, as amended (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. 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 this Quarterly Report and the Risk Factors section of the
Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021
filed with the Securities and Exchange Commission (the "SEC") on March 29, 2022
(the "Annual Report"). The Company's securities filings can be accessed on the
EDGAR section of the SEC's website at 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 incorporated as a Delaware corporation and formed
on October 22, 2020 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 intend to effectuate our initial
business combination (the "Initial Business Combination") using cash from the
proceeds of the initial public offering (the "Initial Public Offering") and the
sale of the private placement warrants (the "Private Placement Warrants" or
"Private Warrants"), our capital stock, debt or a combination of the foregoing.
The issuance of additional shares of common stock in connection with an Initial
Business Combination to the owners of the target or other investors:
may significantly dilute the equity interest of existing investors, which
? dilution would increase if the anti-dilution provisions in the Class B common
stock result in the issuance of Class A common stock on a greater than
one-to-one basis upon conversion of the Class B common stock;
? may subordinate the rights of holders of common stock if shares of preferred
stock are issued with rights senior to those afforded our common stock;
could cause a change in control if a substantial number of common stock are
? issued, which may affect, among other things, our ability to use our net
operating loss carry forwards, if any, and could result in the resignation or
removal of our present officers and directors;
may have the effect of delaying or preventing a change of control of us by
? diluting the stock ownership or voting rights of a person seeking to obtain
control of us; and
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? may adversely affect prevailing market prices for our Class A common stock
and/or warrants.
Similarly, if we issue debt securities or otherwise incur significant
indebtedness to bank or other lenders or the owners of a target, it could result
in:
? default and foreclosure on our assets if our operating revenues after an
Initial Business Combination are insufficient to repay our debt obligations;
acceleration of our obligations to repay the indebtedness even if we make all
? principal and interest payments when due if we breach certain covenants that
require the maintenance of certain financial ratios or reserves without a
waiver or renegotiation of that covenant;
? our immediate payment of all principal and accrued interest, if any, if the
debt is payable on demand;
our inability to obtain necessary additional financing if the debt contains
? covenants restricting our ability to obtain such financing while the debt is
outstanding;
? our inability to pay dividends on our common stock;
using a substantial portion of our cash flow to pay principal and interest on
? our debt, which will reduce the funds available for dividends on our common
stock if declared, our ability to pay expenses, make capital expenditures and
acquisitions and fund other general corporate purposes;
? limitations on our flexibility in planning for and reacting to changes in our
business and in the industry in which we operate;
? increased vulnerability to adverse changes in general economic, industry and
competitive conditions and adverse changes in government regulation;
limitations on our ability to borrow additional amounts for expenses, capital
? expenditures, acquisitions, debt service requirements, and execution of our
strategy; and
? other purposes and other disadvantages compared to our competitors who have
less debt.
We expect to continue to incur significant costs in the pursuit of our
acquisition plans. We cannot assure you that our plans to raise capital or to
complete our Initial Business Combination will be successful.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date.
Our only activities through September 30, 2022 were organizational activities,
those necessary to prepare for the Initial Public Offering, described below,
and, after our Initial Public Offering, day-to-day operations and identifying a
target company for an Initial Business Combination. We do not expect to generate
any operating revenues until after the completion of our Initial Business
Combination. We generate non-operating income in the form of interest income on
marketable securities held in the trust account (the "Trust Account"). We incur
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 three months ended September 30, 2022, we had net income of $521,774,
which consists of an administrative services fee of $30,000 due to a related
party, and of operating costs of $468,769 offset by interest income on
marketable securities held in the Trust Account of $1,132,777 and a change in
fair value of the derivative warrant liabilities and forward purchase agreements
of $173,790. In addition, the Company recorded an income tax provision of
$286,024.
For the three months ended September 30, 2021, we had net income of $5,299,746,
which consists of an administrative services fee of $30,000 due to a related
party and of operating costs of $478,109 offset by interest income on marketable
securities held in the Trust Account of $5,376 and a change in fair value of the
derivative warrant liabilities and forward purchase agreements of $5,802,479.
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For the nine months ended September 30, 2022, we had net income of $5,560,298,
which consists of an administrative services fee of $90,000 due to a related
party and of operating costs of $2,431,044 offset by interest income on
marketable securities held in the Trust Account of $1,514,086 and a change in
fair value of the derivative warrant liabilities and forward purchase agreements
of $6,853,280. In addition, the Company recorded an income tax provision of
$286,024.
For the nine months ended September 30, 2021, we had net income of $4,769,429,
which consists of an administrative services fee of $45,000 due to a related
party and of operating costs of $759,268 offset by interest income on marketable
securities held in the Trust Account of $7,326 and a change in fair value of the
derivative warrant liabilities and forward purchase agreements of $6,158,319. In
addition, the Company recorded costs associated with warrant liabilities of
$591,948.
Liquidity and Capital Resources
Until the consummation of the Initial Public Offering, our only source of
liquidity was an initial purchase of shares of Class B common stock by the
Sponsor and loans from our Sponsor. On May 18, 2021, we consummated the Initial
Public Offering of 23,000,000 units (the "Units") at $10.00 per Unit, generating
gross proceeds of $230,000,000. Simultaneously with the closing of the Initial
Public Offering, we consummated the sale of 6,600,000 Private Placement Warrants
to the Sponsor, at a price of $1.00 per Private Placement Warrant, generating
gross proceeds of $6,600,000.
Following the Initial Public Offering and the sale of the Private Placement
Warrants, a total of $230,000,000 was placed in the Trust Account. We incurred
$13,107,291 in transaction costs, including $4,600,000 of underwriting fees,
$8,050,000 of deferred underwriting fees and $457,291 of other costs.
For the nine months ended September 30, 2022 and 2021, cash used in operating
activities was $2,051,576 and $748,584, respectively. For the nine months ended
September 30, 2022, net income of $5,560,298 was affected by interest earned on
marketable securities held in the Trust Account of $1,514,086, a gain in fair
value of derivative liabilities of $6,853,280, and changes in operating assets
and liabilities, which provided $755,492 of cash from operating activities. For
the nine months ended September 30, 2021, net income of $4,769,429 was affected
by interest earned on marketable securities held in the Trust Account of $7,326,
a gain in fair value of derivative liabilities of $6,158,319, costs associated
with warrant liabilities of $591,948 and changes in operating assets and
liabilities, which provided $55,684 of cash from operating activities.
As of September 30, 2022 and December 31, 2021, we had cash and U.S. treasury
securities held in the Trust Account of $231,336,755 and $230,040,937,
respectively. 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 deferred underwriting commissions and income taxes payable), to complete
our Initial Business Combination. We may withdraw interest to pay taxes, if any.
During the period three and nine months ended September 30, 2022, we withdrew
$218,268 of interest earned on the Trust Account. To the extent that our capital
stock or debt is used, in whole or in part, as consideration to complete our
Initial 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 September 30, 2022 and December 31, 2021, we had cash of $50,096 and
$639,843 outside of the Trust Account, respectively. 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, and structure,
negotiate and complete an Initial Business Combination.
In order to fund working capital deficiencies or finance transaction costs in
connection with an Initial Business Combination, the initial stockholders or
their affiliates may, but are not obligated to, loan us funds as may be
required. If we complete an Initial Business Combination, we will repay such
loaned amounts. In the event that an Initial 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 identical to the Private Placement Warrants, at a
price of $1.00 per warrant at the option of the lender.
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The Company currently has less than 12 months from the date these financial
statements were issued to complete a Business Combination within the Combination
Period (May 18, 2023). As is customary for a special purpose acquisition
company, if the Company is not able to consummate a Business Combination during
the Combination Period, it will cease all operations and redeem the Public
Shares. Management plans to continue its efforts to consummate a Business
Combination during the Combination Period.
In addition, there is no current commitment on the part of any financing source
to provide additional capital and no assurances can be provided that such
additional capital will ultimately be available. As of September 30, 2022, the
Company had a working capital deficit of approximately $2.9 million and cash and
cash equivalents of approximately $50,100.
These conditions raise substantial doubt about the Company's ability to continue
as a going concern for a period of time within one year after the date that the
financial statements are issued. There is no assurance that the Company's plans
to raise additional capital (to the extent ultimately necessary) or to
consummate a Business Combination will be successful or successful within the
Combination Period. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty.
Off-Balance Sheet Arrangements
We did not have any off-balance sheet arrangements as of September 30, 2022 as
defined in Item 303(a)(4)(ii) of Regulation S-K.
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 an
affiliate of the Sponsor a monthly fee of $10,000 for office space, utilities,
secretarial support and administrative services. We began incurring these fees
on May 13, 2021 and will continue to incur these fees monthly for up to 24
months until the earlier of the completion of the Initial Business Combination
and our liquidation.
The underwriters are entitled to a deferred fee of $8,050,000 in the aggregate.
The deferred fee will be waived by the underwriters in the event that we do not
complete an Initial 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 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: use of
estimates, shares of Class A common stock subject to possible redemption, net
income (loss) per share of common stock, derivative financial instruments,
warrant instruments and fair value measurements.
Our significant accounting policies are summarized in Note 2 of our condensed
financial statements.
Recent accounting standards
Management does not believe that any recently issued, but not yet effective,
accounting standards, if currently adopted, would have a material effect on the
Company's condensed financial statements.
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